    [Senate Hearing 106-381]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 106-381

        ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2000

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

                                    HEARINGS

                                    before a

                              SUBCOMMITTEE OF THE

                COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                           ONE HUNDRED SIXTH CONGRESS

                                 FIRST SESSION

                                       on

                               H.R. 2605/S. 1186

     AN ACT MAKING APPROPRIATIONS FOR ENERGY AND WATER DEVELOPMENT FOR THE
         FISCAL YEAR ENDING SEPTEMBER 30, 2000, AND FOR OTHER PURPOSES

                                   __________

                             Department of Defense
                              Department of Energy
                           Department of the Interior
                           Nondepartmental witnesses

                                   __________

             Printed for the use of the Committee on Appropriations

                     U.S. GOVERNMENT PRINTING OFFICE
    54-212 CC            WASHINGTON : 2000

    _______________________________________________________________________
                For sale by the U.S. Government Printing Office
    Superintendent of Documents, Congressional Sales Office, Washington, DC
                                     20402
                               ISBN 0-16-060265-3

                          COMMITTEE ON APPROPRIATIONS

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

                  Subcommittee on Energy and Water Development

                     PETE V. DOMENICI, New Mexico Chairman
    THAD COCHRAN, Mississippi            HARRY REID, Nevada
    SLADE GORTON, Washington             ROBERT C. BYRD, West Virginia
    MITCH McCONNELL, Kentucky            ERNEST F. HOLLINGS, South Carolina
    ROBERT F. BENNETT, Utah              PATTY MURRAY, Washington
    CONRAD BURNS, Montana                HERB KOHL, Wisconsin
    LARRY CRAIG, Idaho                   BYRON DORGAN, North Dakota
    TED STEVENS, Alaska (ex officio)

                               Professional Staff

                                 Alex W. Flint
                               W. David Gwaltney
                             Greg Daines (Minority)

                             Administrative Support

                               Lashawnda Leftwich

                                C O N T E N T S

                                  ----------

                             Tuesday, March 9, 1999

                                                                       Page
    Department of the Interior: Bureau of Reclamation................     1
    Department of Defense--Civil: Department of the Army: Corps of
      Engineers--Civil...............................................    63

                            Thursday, March 11, 1999

    Department of Energy: Atomic Energy Defense and Nonproliferation
      Programs.......................................................   193

                            Thursday, March 18, 1999

    Department of Energy: Environmental Management and Civilian Waste
      Management Program.............................................   269

                            Tuesday, April 13, 1999

    Department of Energy:
        Office of Science............................................   383
        Office of Nuclear Energy, Science and Technology.............   383
        Office of Energy Efficiency and Renewable Energy.............   383

                           NONDEPARTMENTAL WITNESSES

    California water resource development projects...................   525
    Nationwide water resource organization...........................   599
    New York and New Jersey water resource projects..................   612
    Southeastern U.S. water resource development projects............   620
    Ohio River Valley inland navigation projects.....................   651
    Mississippi and Louisiana water resource projects................   656
    Midwest U.S. water resource development projects.................   699
    Upper Midwest water projects.....................................   729
    Southwest U.S. water resource development projects...............   748
    Pacific Northwest water resource projects........................   770
    Department of Energy programs and activities.....................   790
    California navigation and related projects.......................   850

        ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2000

                                  ----------

                             TUESDAY, MARCH 9, 1999

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 10:10 a.m., in room SD-124, Dirksen
    Senate Office Building, Hon. Pete V. Domenici (chairman)
    presiding.
        Present: Senators Domenici, Cochran, Gorton, Bennett,
    Burns, Craig, Stevens, Reid, Kohl, and Dorgan.

                           DEPARTMENT OF THE INTERIOR

                             Bureau of Reclamation

    STATEMENTS OF:
            PATRICIA BENEKE, ASSISTANT SECRETARY OF THE INTERIOR, WATER AND
                SCIENCE
            ELUID MARTINEZ, COMMISSIONER, BUREAU OF RECLAMATION

                               opening statement

        Senator Domenici. The committee will please come to order.
        Patty, it's good to see you again.
        Today, we begin our hearings on the fiscal year 2000 budget
    for agencies and programs under the jurisdiction of the Energy
    and Water Development Subcommittee. This morning we have
    representatives from the Department of the Interior to review
    the funding requests of the Bureau of Reclamation. Following
    their testimony, we will hear from the Corps of Engineers. This
    continues our tradition of alternating the order of the Corps'
    and the Bureau's testimony each year in an effort to be fair to
    agencies and members who may be interested in one over the
    other.
        First, it is a pleasure to welcome Patty Beneke, Assistant
    Secretary of the Interior for Water and Science; and Eluid
    Martinez, Commissioner of the Bureau of Reclamation and a
    resident of the State of New Mexico. Eluid, it is nice to have
    you here.
        Mr. Martinez. Thank you, Mr. Chairman.
        Senator Domenici. Both of our witnesses appeared last year
    before the committee and are well known to both the staff and
    the committee members.

                                 budget request

        The fiscal year 2000 budget request for the Bureau of
    Reclamation totals $856,600,000, compared to the appropriation
    of $780.5 million, an increase of $76 million over the current
    year. This includes an increase of $30 million over the 1999
    water and related resources; a $20 million increase for the
    CALFED restoration program, which totals $95 million for the
    year 2000; and a $14 million increase in the Central Valley
    Project Restoration Fund in California, for a total of $47.3
    million; and some smaller increases in other programs and
    activities.
        Our initial review indicates that there are no major
    changes or proposals put forth in the budget request of the
    administration for the Bureau of Reclamation for the year 2000.
        Now, having said that, since we have much to do this
    morning, I will say nothing further and yield to Senator Reid,
    our ranking member, for any comments that he may have.
        So, again, I welcome both of you. I welcome those in the
    audience, and clearly the Corps of Engineers will follow these
    witnesses.

                        statement of senator harry reid

        Senator Reid. Mr. Chairman, I appreciate very much your
    involvement, of course, as chair. I will follow your example
    and ask unanimous consent that my full statement be made part
    of the record.
        I would just comment that I am also a member of the
    authorizing committee, the Environment and Public Works
    Committee, and we are this morning having a hearing on
    something that we will have to fund at a later time. We are
    having the Corps of Engineers on the Water Resources
    Development Act. So, I am going to have to be excused at a
    later time to whip over there and make an appearance.
        The Bureau of Reclamation has had a significant history in
    the State of Nevada. The first ever Bureau of Reclamation
    project in the country was in Nevada, the Newlands Project,
    which for 70 years was fairly noncontroversial, but the last 20
    years has been very controversial. But the Bureau has always
    had a prominent place in that project.
        Also, of course, with the construction of Boulder, later to
    become the Hoover Dam, the Bureau of Reclamation was and has
    been heavily involved in that little city in the southern part
    of the State.
        Flood control projects which are becoming so important in
    the two metropolitan areas of Reno and Las Vegas, the Corps of
    Engineers is vitally involved. Hundreds of millions of dollars
    are being spent in those two areas to stop the loss of life and
    property.

                               prepared statement

        So, I look forward to this hearing and to working with
    these two agencies during the coming year.
        [The information follows:]

                    Prepared Statement of Senator Harry Reid

        Mr. Chairman, I appreciate this hearing on the U.S. Army Corps of
    Engineers and the Bureau of Reclamation. Both the Corps and Bureau have
    played a vital role in the development of American water management
    infrastructure that is all too often overlooked. And unfortunately,
    given the numbers that I see in the Budget Request, the future role of
    the Bureau and Corps are now minimized in the perception of some in the
    administration.
        The need for water projects is not diminishing, indeed some may
    argue that the need is increasing, and yet some at Office of Management
    and Budget and elsewhere would like to dictate the course of the
    program by tightening the budget for surveys, studies and new
    construction. I think it is a perilous path to trod when we
    underestimate the economic, societal, and hydrological impacts of these
    water programs. This is why the communities at home so distinctly
    recognize these projects. And while it is derisively called a
    congressional pork program, we need not make any apologies for that
    because of the many benefits of these projects as water is managed
    throughout the nation.
        The Army Corps of Engineers has a history that dates back to the
    origins of the nation and I appreciate the vast function that the Corps
    has in the management of the nation's navigational waters. For example,
    this last week, I learned that half of New Orleans lives under sea
    level and without the maintenance of its levees and canals that city,
    indeed, most of the state of Louisiana would be under water. Around the
    nation, there are communities that rely on these flood control
    projects, from Reno to Las Cruces, New Mexico.
        There's no doubt that the work on the harbors and ports of the
    nation is essential to our trade and commerce. For instance, the ports
    of the nation move over 13.5 million tons of breakbulk cargo annually;
    which is an estimated $600 billion in international cargo generating
    over $150 billion in tax revenue. There are critical issues that we
    need to pursue further, and about which I will have specific questions,
    including the administration's continuing concern about the endless
    need of beach or shoreline erosion. Since Nevada is not on the
    shoreline, I do not have a parochial interest but a concern that
    commitment made to these states and communities cannot be washed away,
    pun intended.
        Additionally, the cooperative agreements that are being negotiated
    with non-federal sponsors are creating a mechanism that could create a
    very precarious financial condition for the Corps. The Chairman and I
    are working through that issue. I have discussed that issue with both
    the Assistant Secretary and General Fuhrman and I appreciate your
    perspectives.
        There are a number of projects that are now rectifying the mistakes
    of management of water resources and engineering approaches in such
    places as the Kissimmee River that feeds into the Florida Everglades
    and the Truckee River in Nevada. I think we need to assess the future
    commitment that rectifying these mistakes will require of us.
        The Bureau of Reclamation has recently celebrated its 150th
    anniversary. I congratulate the Bureau on its many achievements and
    stellar record. Many of the communities throughout the western United
    States were developed as a consequence of the Bureau of Reclamation's
    water management.
        As you are aware, there is some criticism that the bureau has been
    expanding its mission and activities. I am interested in your vision,
    Assistant Secretary and Commissioner, of the future of the Bureau and
    not just this fiscal year.
        I note that the Budget Request has $95 million for California Bay
    Delta Restoration which is bringing that request into line with the
    appropriations level, generally. That still is a significant amount of
    money that could be funding many multiple projects. I hope you will
    discuss the progress and measurable benchmarks of CALFED effort.
        Additionally, I would appreciate a discussion of the environmental
    restoration mission and its relationship to the reclamation management
    of water.

                          statement of patricia beneke

        Senator Domenici. Senator Bennett, would you like to
    comment?
        Senator Bennett. No.
        Senator Domenici. Thank you for coming to the hearing this
    morning.
        Patty, you are first. Patty Beneke.
        Ms. Beneke. Thank you very much, Mr. Chairman, members of
    the subcommittee. I am pleased to discuss the President's
    fiscal year 2000 budget request for the Bureau of Reclamation.
    Eluid Martinez, the Commissioner of the Bureau, is here today
    as well, and he will provide further detail with respect to the
    budget.
        I am going to be very brief this morning and summarize my
    testimony.
        As you stated, Mr. Chairman, the request for the Bureau of
    Reclamation totals $856.6 million. Of this amount, over $278
    million is requested for facility operations, maintenance, and
    rehabilitation. This is an increase of over $15 million from
    last fiscal year and reflects the fact that the Commissioner
    and I place a high priority on these projects.
        I also note that the budget request for the Department
    reflects the Administration's continued commitment to address
    natural resource issues by working in geographically based
    partnerships. These partnerships cross not only jurisdictional
    boundaries within the Federal Government, but also involve the
    States, tribes, local communities, and affected stakeholders.
    An example of one such partnership is the California Bay-Delta
    Program, and I would like to take just a few minutes to talk a
    little bit about that very important program.

                          california bay-delta program

        This is a tremendously important effort under which CALFED,
    comprised of 10 Federal agencies and 4 State agencies, is
    working with all interested stakeholders to develop a long-term
    solution to the many water resource issues presented in the San
    Francisco Bay-Delta region in California. This solution will
    address water supply reliability issues, levy stabilization
    which is key to flood protection, water quality, and restoring
    the health of the Bay-Delta region. The Bay-Delta itself
    provides drinking water to over two-thirds of the State of
    California and irrigation water to three-quarters of the
    Nation's fruit and vegetable crop. It is also a national
    resource in that it is the largest wetland estuary in the West.
        From our perspective at Interior, a key goal of the program
    is to provide greater certainty and reliability of supply to
    our many Central Valley Project contractors, as well as to
    resolve issues relating to the ecological health of the Bay-
    Delta region.
        The President's fiscal year 2000 budget for the Bureau of
    Reclamation requests $95 million for Federal cost sharing for
    the program. Of this amount, $75 million would be used pursuant
    to the California Bay-Delta Environmental Enhancement Act
    passed by Congress a couple of years ago. These funds would
    build upon the restoration begun in fiscal year 1998 and
    continued in 1999 by monitoring prior projects and initiating
    and implementing new projects approved by CALFED and the
    Secretary. The remaining $20 million is requested for non-
    ecosystem restoration activities, such as groundwater storage,
    water use efficiency, water quality, and watershed management.
        This request signals that the Administration has a
    commitment to funding all elements of the California Bay-Delta
    Program. We believe it is important to get this work underway.

                              central utah project

        Finally, this morning I would like to note that
    responsibility for overseeing the implementation of the Central
    Utah Project Completion Act rests with my office, and I would
    be pleased to answer any questions you might have on this
    topic, as well as any others.

                               prepared statement

        Again, thank you for the opportunity to testify. It is an
    honor and privilege to be here. With your permission, I would
    like to pass the baton on to Commissioner of Reclamation, Eluid
    Martinez, who will provide further details on the budget
    request.
        [The statement follows:]

                    Prepared Statement of Patricia J. Beneke

        I am pleased to appear before this Subcommittee again as Assistant
    Secretary for Water & Science to testify in support of the President's
    fiscal year 2000 budget for the Bureau of Reclamation and the Central
    Utah Project.
        Eluid Martinez, the Commissioner of the Bureau of Reclamation is
    also appearing today. His testimony will address details of the fiscal
    year 2000 budget request for the Bureau of Reclamation. This morning I
    would like to highlight only one or two key elements in Reclamation's
    budget and also discuss the request for the Central Utah Project, for
    which my office is responsible. Ron Johnston, Program Director for the
    Central Utah Project (CUP) Completion Act Office is also with me today.
        Reclamation's fiscal year 2000 request will allow the timely and
    effective delivery of project benefits; ensure the reliability and
    operational readiness of Reclamation's dams, reservoirs, power plants,
    and distribution systems; and identify, plan, and implement dam safety
    corrective actions and site security improvements. Providing adequate
    funding for the operation, maintenance and rehabilitation of its
    facilities continues to be one of Reclamation's highest priorities, and
    its staff works closely with water users and other stakeholders to
    ensure that available funds are used effectively.
        The budget request for the Department of the Interior reflects the
    Department's and the Administration's continued commitment to address
    natural resource issues by working in geographically-based partnerships
    that cross not only the jurisdictional boundaries within the Federal
    government but also involve the States, Tribes, local communities and
    affected stakeholders. Solving natural resource problems is vital to
    the successful operation of Reclamation Projects.
        This approach is reflected in several initiatives in the
    Department's fiscal year 2000 budget. In South Florida, several Federal
    agencies are working closely with the State, Tribes, local communities
    and affected stakeholders to restore the Everglades. Because funding
    for another such vital effort, the multi-agency Bay-Delta Restoration
    Program, is included in the Bureau of Reclamation's budget request, I
    will discuss it in more detail this morning.
                   california bay-delta ecosystem restoration
        The fiscal year 2000 budget proposes funding of $75 million for
    ecosystem restoration efforts that will build on the fiscal year 1998
    and fiscal year 1999 programs by monitoring prior projects and
    initiating and implementing new projects approved by CALFED and the
    Secretary. In addition, $20 million is requested for non-ecosystem
    restoration activities authorized under various current authorities,
    such as water use efficiency, water quality, groundwater storage,
    levees, conveyance, and watershed management that would be common to
    any version of the overall Bay-Delta Long-term Plan that is ultimately
    selected.
        Ecosystem Restoration funds are requested in an account within the
    Bureau of Reclamation and provided to participating agencies based upon
    the program recommended by CALFED and approved by the Secretary of the
    Interior in consultation with participating agencies. Participating
    agencies will work directly with and administer contracts with non-
    Federal entities. Federal funds would be available in a manner
    consistent with the terms of the existing cost-sharing agreement and
    environmental review requirements. Also, CALFED is developing a
    comprehensive framework to provide a more reliable water supply for all
    uses, stabilize levees, and improve water quality. Restoring the health
    of the Bay-Delta ecosystem is central to meeting these objectives.
        Fiscal year 1998 was the first year that Federal agencies had funds
    for the Bay-Delta Program. During the year, Federal agencies made
    considerable progress in developing a project selection/approval
    process to assure that funds are being used for the highest priority
    ecosystem restoration projects and that all proposed and selected
    projects comply with Federal contract provisions. The process assures
    extensive public participation. By the end of the year, CALFED had
    recommended and the Secretary of the Interior had approved programs and
    projects to use all of the $85 million appropriated in fiscal year
    1998. Reclamation had contracts or agreements with other agencies
    obligating $73 million.
        CALFED is using the fiscal year 1999 funds expeditiously and on
    high priority activities. The Secretary has approved ecosystem
    restoration projects that would use $65 million of the $75 million
    appropriated in fiscal year 1999. CALFED currently has a request for
    proposals out to the public to solicit other ecosystem restoration
    projects that will be funded in fiscal year 1999 and fiscal year 2000.
        The Administration is submitting authorization language that would
    extend current spending authorization through 2003 to enable the
    ecosystem restoration program to be fully funded at the $430 million
    authorized by the California Bay-Delta Environmental Enhancement Act.
                             bureau of reclamation
        Aside from the request for the Bay-Delta Restoration initiative,
    the budget request for the Bureau of Reclamation totals $761.6 million,
    an increase of $30.2 million from the fiscal year 1999 level. The
    request includes adequate funding for operations, maintenance and
    rehabilitation, which continues to be a high priority for both the
    Commissioner and me. The request includes $71 million for the dam
    safety program, $27 million for the Central Arizona Project; $28.7
    million for the Colorado River Basin Salinity Control Program; $27
    million for the Garrison Diversion Unit; $31.5 million for Water
    Reclamation/Reuse projects; $125 million for the Central Valley
    Project; $47.3 million for the Central Valley Project Restoration Fund;
    $13 million for Columbia/Snake River Salmon Recovery and $15 million
    for Endangered Species Recovery in other river basins.
        Reclamation's water management mission places a greater emphasis on
    water conservation, recycling and reuse; developing partnerships with
    its customers, States and Tribes; finding ways to bring various
    interests together to address their water needs; good stewardship of
    Reclamation's facilities; and transferring title and operation of some
    facilities to local beneficiaries. All these changes have one goal--to
    meet the increasing water demands of the West while protecting the
    environment and the public's investment.
        The Reclamation budget request also includes the Annual Performance
    Plan required under the Government Performance and Results Act. This
    plan identifies the annual goals for fiscal year 2000 that support
    Reclamation's Strategic Plan.
                      central utah project completion act
        The Central Utah Project Completion Act provides for completion of
    the Central Utah Project (CUP) by the Central Utah Water Conservancy
    District. The Act also authorizes funding for fish, wildlife, and
    recreation mitigation and conservation; establishes the Utah
    Reclamation Mitigation and Conservation Commission to coordinate
    mitigation and conservation activities; and provides for the Ute Indian
    Rights Settlement.
        The Secretary is prohibited from delegating his responsibilities
    under the Act to the Bureau of Reclamation. As a result, responsibility
    for overseeing implementation of the Act rests with the Assistant
    Secretary for Water and Science. The Department has established a
    program coordination office in Provo, Utah, with a Program Director to
    provide oversight, review, and liaison with the District, the
    Commission, and the Ute Indian Tribe, and to assist in administering
    the responsibilities of the Secretary under the Act.
        The fiscal year 2000 request for the Central Utah Project
    Completion Account provides $39.4 million for use by the District, the
    Commission, and the Department to implement Titles II-IV of the Act, a
    decrease of $3.1 million from the fiscal year 1999 enacted level. The
    request includes $18.6 million for the District to initiate
    construction on the remaining segments of the Diamond Fork System; to
    complete construction of the Wasatch County Water Efficiency Project;
    to implement approved water conservation and water management
    improvement projects; to implement the groundwater recharge and
    conjunctive use program; to initiate construction of the Duchesne/
    Strawberry diversion structures; and to continue development of
    planning and NEPA documents on facilities to deliver water in the Utah
    Lake drainage basin. No new funds are requested for the Uinta Basin
    facilities.
        The request also provides $12.0 million for use by the Commission
    for mitigation and conservation projects authorized in Title III of the
    Act, including fish hatchery improvements, construction of the Daniels
    Creek Pipeline, and for acquisition of habitat, access, and water
    rights along the Provo River and other key watersheds; and for
    completing other mitigation measures identified in Reclamation planning
    documents under Title II of the Act.
        Finally, the request includes funds for the Federal contribution to
    the principal of the Utah Reclamation Mitigation and Conservation
    Account ($5.0 million); for mitigation and conservation projects
    outside the State of Utah ($0.4 million); for modifications to Syar
    Tunnel that are necessary to meet the minimum instream flow
    requirements ($2.0 million); and for program administration ($1.3
    million).
        In addition to the request described above, the Bureau of Indian
    Affairs' budget includes $27.5 million for the Ute Indian Rights
    Settlement; and $5.0 million is included in the request for the Western
    Area Power Administration for its contribution to the Utah Reclamation
    Mitigation and Conservation Account.
        This completes my statement today. Again, thank you for providing
    me the opportunity to discuss with this subcommittee our fiscal year
    2000 requests. The Commissioner and I will be pleased to respond to
    your questions.

                         STATEMENT OF ELUID L. MARTINEZ

        Senator Domenici. Commissioner, we are glad to have you.
        Mr. Martinez. Good morning, Mr. Chairman, members of the
    subcommittee. I appreciate this opportunity to discuss the
    President's fiscal year 2000 budget with the subcommittee.
        I am sure all of you are aware of the history of the Bureau
    of Reclamation, and my written statement goes into that. I will
    summarize my statement and get to the issues as I view them.
        Our budget request is for $856.6 million, of which
    approximately $762 million is for ongoing Reclamation programs.
    Also included is $95 million for the California Bay-Delta
    Restoration account: $75 million for ecosystem restoration, and
    $20 million for our other activities.
        The $652.8 million requested in the Water and Related
    Resources account basically deals with our water resource and
    energy management programs, our wildlife and fish management
    programs, our land management programs, and our facility
    operation and maintenance. Also included in our request is
    $47.3 million for the Central Valley Project Restoration Fund,
    and $12.4 million for our loan program to continue five small
    loan projects, two of which will be completed this year. The
    balance is reflected in $49 million in our request for policy
    administration, which is a $2 million increase over the fiscal
    year enacted level.

                             safety of dams program

        Mr. Chairman, members of the subcommittee, our Safety of
    Dams program basically addresses the continuing safety and
    analysis of our structures. We place high priority on the
    safety of our dams. It funds adequately, I believe, the
    operation and maintenance of our facilities out West. It
    continues to move along some of our construction projects
    specifically dealing with waste water reuse and rural water
    distribution systems, probably not at the level that the
    project sponsors would wish, and includes some monies for some
    Indian water systems, including initiation of construction of
    the Gila portion of the Central Arizona Project.

                               prepared statement

        Generally, Mr. Chairman, that concludes my summary remarks.
    I will be glad to answer any specific questions you might have.
        Senator Domenici. Your statement will be made a part of the
    record, and yours, Ms. Beneke, will also be made a part of the
    record. I did not say that Senator Reid's was, but it will be.
        [The statement follows:]

                  Prepared Statement of Hon. Eluid L. Martinez

        Mr. Chairman and Members of the Subcommittee, I appreciate the
    opportunity to appear before the Subcommittee this morning to discuss
    the Bureau of Reclamation's fiscal year 2000 budget request.
        The Bureau of Reclamation has been in existence for 97 years,
    developing and managing water and related resources in the Western
    United States. Having constructed more than 600 dams and reservoirs,
    including such significant structures as Hoover and Grand Coulee Dams,
    Reclamation today is the largest water wholesaler in the country,
    bringing water resources to more than 31 million people and irrigating
    approximately 10 million acres of land. Reclamation is also the second
    largest producer of hydroelectric power in the nation and the fifth
    largest electric utility in the West. Reclamation's 58 powerplants
    annually provide more than 40 billion kilowatt-hours, generate nearly a
    billion dollars in power revenues, and produce enough electricity to
    serve six million homes.
        Today, the main focus of the Bureau of Reclamation is to provide
    improved water resources management. Reclamation programs include a
    broad range of water uses, such as domestic water supply, irrigation,
    Indian self-sufficiency, fish and wildlife protection, endangered
    species recovery, environmental restoration, and recreation. Since
    water is a scarce resource in the West, the budget proposes innovative
    strategies for addressing water resource issues, including water
    reclamation and reuse.
        For fiscal year 2000, the Bureau of Reclamation is requesting
    $856.6 million in new budget authority. This request includes $761.6
    million for Reclamation's traditional programs, an increase of $30.2
    million from the fiscal year 1999 level; and $95.0 million for the
    California Bay-Delta Ecosystem Restoration account, which is
    administered by Reclamation but funds activities in several Federal
    agencies, an increase of $20.0 million.
        Before moving into the more specific financial data, I'd like to
    discuss several programs and issues of interest.
                            annual performance plan
        The Government Performance and Results Act (GPRA) of 1993 requires
    annual performance plans beginning with fiscal year 1999 and annual
    performance reports beginning in March of 2000. Reclamation has made
    significant progress in implementing GPRA. Reclamation has begun
    submitting quarterly reports to the Department showing progress made in
    accomplishing the goals and indicators in the fiscal year 1999
    Performance Plan. Based on Reclamation's Strategic Plan, the fiscal
    year 2000 Annual Performance Plan has been developed to address the
    direction of key programmatic activities. This plan reflects the
    linkage between strategies and goals of the Strategic Plan, the annual
    performance goals and indicators, and the programmatic budget. Each
    performance goal is linked to program and financing activities and
    accounts as indicated in the tables provided with the Annual
    Performance Plan.
                                   dam safety
        Reclamation's Dam Safety Program is critical to the management of
    risks associated with events, such as earthquakes, floods, etc., that
    could threaten the safety of Reclamation dams, and the downstream
    public, property, and natural resources near those structures. Ensuring
    the safety and reliability of Reclamation dams continues to be one of
    Reclamation's highest priorities. Approximately 50 percent of
    Reclamation's dams were built between the years 1900 and 1950 and
    approximately 90 percent of the dams were built before current state-
    of-the-art design and construction practices. Aging dams, which lack
    state-of-the-art structural reliability features, place a greater
    reliance on ongoing risk management activities such as monitoring,
    examinations and, engineering analyses to assure safe performance of
    any dam. A strong Dam Safety Program must be maintained to identify
    quickly any adverse performance within Reclamation's inventory of aging
    dams and to carry out necessary corrective actions when unreasonable
    public risks are identified.
        Reclamation's fiscal year 2000 budget request includes $60.9
    million for the Safety of Dams Evaluation and Modification Program that
    provides for a variety of risk management activities pertaining to
    Reclamation's 362 high and significant hazard dams. Included in that
    amount are preconstruction and construction activities on up to 26 dams
    which may require modifications for safety reasons. Most notable are
    the activities at Yakima Project, Washington, and Casitas Dam, Ventura
    River Project, California, which have critical Safety of Dams issues
    that require modifications of significant cost and scope.
        In addition, $8.8 million is being requested to complete
    modifications on Bradbury Dam in California, Reservoir A Dam in Idaho,
    Pueblo Dam in Colorado, and for ongoing modifications at Horse Mesa Dam
    in Arizona. Modifications on Lost Creek Dam in Utah and Twin Buttes Dam
    in Texas are scheduled to be completed in fiscal year 1999 with no
    additional funding anticipated for fiscal year 2000. An additional $1.6
    million is included in the request for the Department of the Interior
    Dam Safety Program.
        It should be noted that Reclamation's fiscal year 1999 Dam Safety
    Program request was reduced by $8,787,000. As a result, Reclamation had
    to re-prioritize its Safety of Dams risk reduction activities in fiscal
    year 1999, and shift some activities and costs into fiscal year 2000.
    The reduction impaired Reclamation's ability to pursue more
    aggressively the necessary risk reduction actions at its dams. Current
    enacted funding and future requests will be managed to focus funding to
    the most critical Safety of Dams issues presently known to Reclamation.
    Funding the full fiscal year 2000 Dam Safety Program request is
    necessary to avoid any delays in eliminating risk reduction efforts
    needed for public safety.
        Now, I would like to focus on Reclamation's fiscal year 2000 Budget
    request by appropriation.
                          water and related resources
        The amount requested for the Water and Related Resources
    appropriation for fiscal year 2000, $652.8 million, is an increase of
    $10 million from the fiscal year 1999 enacted level of $642.8 million.
    This appropriation funds five program activities: Water and Energy
    Management and Development, Fish and Wildlife Management and
    Development, Land Management and Development, Facility Operations, and
    Facility Maintenance and Rehabilitation.
        The fiscal year 2000 Budget proposes $278.6 million for Facility
    Operations and Facility Maintenance and Rehabilitation, an increase of
    $15.6 million from the fiscal year 1999 enacted level. Reclamation
    places high priority on these activities, which ensure delivery of
    project benefits and protect the Federal investment and the public
    through the dam safety program, discussed above, and other measures.
        The request includes $27.3 million for the Central Arizona Project;
    $125.0 million for the Central Valley Project in California; $29.4
    million for the Mni Wiconi Project and $5 million for the Mid-Dakota
    Project in South Dakota; $27 million for the Garrison Project in North
    Dakota; and $3 million for the Animas-La Plata Project in Colorado and
    New Mexico.
        The fiscal year 2000 request of $31.5 million for water recycling
    includes funding for four projects that were authorized by the 104th
    Congress in 1996, plus continued funding for ongoing projects. The
    request includes $6.0 million for the four new starts: Calleguas
    Municipal Water District Recycling, Long Beach Area Water Reclamation
    and Reuse, North San Diego County Water Reclamation and Reuse, and
    Orange County Regional Water Reclamation Project. In addition, funds in
    the amount of $23.2 million will be used for ongoing California
    projects in Los Angeles, San Diego, San Gabriel and San Jose. The
    fiscal year 2000 request also includes $2.2 million for feasibility
    studies and research.
        The request also includes $7.3 million for Reclamation's Science
    and Technology Program. This funding is requested for development of
    new information and technologies that respond to and anticipate
    mission-related needs, and that provide for innovative management,
    development, and protection of water and related resources and
    associated values through cost-shared research and technology transfer.
                                  loan program
        Funding of $12.4 million is requested to complete work on 2 loan
    projects: Chino Basin Desalination and Temescal Valley. Work will
    continue on three loan projects: Castroville Irrigation, Salinas Valley
    Water Reclamation, and San Sevaine Creek, all of which are located in
    California. In addition, $425,000 is requested for program
    administration.
                           policy and administration
        The $49 million requested supports Reclamation's centralized
    management functions. These functions include overall program and
    personnel policy management; equal employment opportunity management;
    safety and health management; budgetary policy formulation and
    execution; information resources management, property, and general
    services policy; public affairs activities; and organizational and
    management analysis.
                    central valley project restoration fund
        The Restoration Fund request for fiscal year 2000 is $47.3 million.
    These funds are focused on four primary emphases: water acquisition for
    instream flows and refuges; refuge conveyance and refuge water
    wheeling; land retirement; and the Anadromous Fish Restoration Program.
    Efforts to provide for the doubling of the anadromous fish population
    are expected to be enhanced through increased emphasis on partnerships
    with local, state, and stakeholder involvement.
        The budget request includes a provision for the conversion of the
    CVP Restoration Fund to a permanent appropriation. This action would
    ensure that collections from project beneficiaries are available for
    their intended purpose and would improve project planning by both
    beneficiaries and managers.
                   california bay-delta ecosystem restoration
        The fiscal year 2000 budget includes a request for $95 million to
    continue Federal cost-sharing in ecosystem restoration efforts in
    California's Bay-Delta. Although requested in a single account under
    Reclamation, the funds will be distributed among participating Federal
    agencies based upon the program recommended by CALFED, a consortium of
    Federal and State agencies with management and regulatory
    responsibilities in the Bay-Delta, and approved by the Secretary of the
    Interior.
        The fiscal year 2000 budget request provides details on how
    Reclamation intends to use the funds, including a summary of how the
    project selection process works. Participating agencies and the CALFED
    staff developed in fiscal year 1998 and fiscal year 1999 a program that
    covers habitat acquisition and restoration, improvements to fish
    screens and passage, and exotic species management. The fiscal year
    2000 budget proposes $75 million to build upon the efforts begun in
    1998 and continued in 1999 by monitoring prior projects, initiating,
    and implementing new projects approved by CALFED and the Secretary. In
    addition, $20 million is requested for non-ecosystem restoration
    activities that are in accord with the CALFED Bay-Delta Program, such
    as water use efficiency, water quality, groundwater storage, and
    watershed management.
        The Administration will submit authorization language that would
    extend current spending authorization through 2003 to enable the
    ecosystem restoration program to be fully funded at the $430 million
    authorized by the California Bay-Delta Environmental Enhancement Act.
        Mr. Chairman and Members of the Subcommittee, this concludes my
    prepared remarks. I would be happy to respond to any questions Members
    may have concerning the Reclamation program and our fiscal year 2000
    Budget request.

                       Truckee River Operating Agreement

        Senator Domenici. I am going to let you go first, Senator
    Reid, and then you, Senator Bennett.
        Senator Reid. I appreciate that very much, Mr. Chairman.
        Ms. Beneke, as you know the Truckee River Operating
    Agreement still has a few things that need to be done, and one
    item is the final environmental impact statement. I have worked
    with Bill Bettenberg for a number of years, who has been
    tremendously helpful in his work on this project.
        Because the environmental impact statement will be funded
    through the Bureau of Reclamation, I am wondering if you can
    assure this subcommittee that it will be given priority in
    regards to staff and funding so that we can get this done.
        Ms. Beneke. Senator, you certainly do have my assurances in
    this regard. We consider this to be a very important
    undertaking. We very much appreciate your leadership in helping
    us wend our way through the difficult issues and the important
    issues presented in that River basin.
        Senator Reid. I would hope also that rather than--I will
    not say waste, but rather than utilize the time and money for
    reeducating staff at your regional office in Denver, I would
    encourage you to use as much of the local resources as you can.
    I think it would add some continuity and I think in the long
    run save money. If you would take a look at that, that would be
    good.
        Ms. Beneke. I would be happy to, Senator.

                                 desalinization

        Senator Reid. In regards to desalinization, the Bureau of
    Reclamation has had some responsibility for desalinization in
    the past. As you know, Senator Simon has even written a book on
    the problems of water in the world. It is called ``Tapping
    Out'', a very fine book that Senator Simon has recently
    published.
        While the Desalinization Act of 1996 has authorized up to
    $5 million a year for research and studies, or $20 million, the
    Bureau of Reclamation has requested less than $4 million since
    1997. Why is this?
        Mr. Martinez. Mr. Chairman, Senator, basically it is an
    economic issue. Given the priorities and the limited resources
    that we have in our budget, we have come up with a request for
    these amounts of money. I fully realize that Congress has added
    funding which has increased those amounts over the last 2
    years, but we continue to try to put as much money as we
    possibly can into that project.
        Senator Reid. As indicated in Secretary Beneke's statement,
    the direction of the Bureau of Reclamation has changed over the
    years. There was a time when there was a construction of, I
    think, some 600 dams that the Bureau of Reclamation has been
    involved in, and now the concern is more with water resource
    management.
        That being the case, I believe the Bureau should look very
    strongly at the Desalinization Act because it seems to me that
    that is the wave of the future. We have to look at new places
    for water, and I think one of the places that has some promise
    is brackish and salty water that we have around the country.
    Would you agree with that?
        Mr. Martinez. I would agree with that. I think the Bureau
    has a long history of working in this area. We have a desalting
    plant down in Yuma.
        Senator Reid. I understand that, Mr. Martinez. The problem
    with that is we are doing nothing new. The technology there is
    technology that was available 40 years ago.

                       reclamation role in desalinization

        What I would like you to do--and I will not take any more
    time of the subcommittee--I would like you to present to me and
    to the subcommittee your view as to what the future of the
    Bureau should be if you had the money that you needed in regard
    to desalinization.
        Mr. Martinez. I will be glad to do that.
        Senator Reid. Keep in mind the words that I used.
        Mr. Martinez. Correct.
        Senator Reid. I have a number of other questions, Mr.
    Chairman. I will submit those in writing.
        Senator Domenici. Thank you, Senator.
        [The information follows:]

                    Desalination--Reclamation's Future Focus

                                  introduction
        Reclamation has a long tradition of commitment to desalination, and
    particularly a tradition of being a leader in its development and
    application. Reclamation recognized early in the 1960's and 1970's the
    potential value of desalination to play a significant role in
    developing and managing the water resources in the western United
    States. Reclamation played a key role in testing the new desalination
    technologies as they were developed in the 1960's by the DOI Office of
    Saline Water, followed by the very early application on a large scale
    of membrane desalination at the Yuma Desalting Plant. These early
    commitments to the development and application of the desalination
    technologies has continued through our support of reimbursed
    involvement in desalination R&D in the Middle East, and more recently,
    our commitment through Title XVI legislation to
    demonstration of new membrane technologies in water recycling
    applications.
        It is clear that future water resource management in the western
    United States will be more heavily dependent on innovative sources of
    water. Although the population continues to grow, fresh water sources
    remain constant. Therefore, to continue to meet the future water
    demands, Reclamation must be pro-active. Water conservation, water
    recycling, and desalination should all play roles in meeting future
    water demands, in addition to our existing conventional water resource
    capabilities.
        In consideration of meeting these future water demands, in 1989
    Reclamation began investigating the desalination research needs to
    reduce the costs of the technologies.\1\ This effort was accomplished
    through sponsorship of various workshops, seminars, and studies.\2\ \3\
    \4\ \5\ \6\ \7\ \8\ In 1992, Reclamation initiated a small desalination
    R&D program, using cost- sharing and human resources from the private
    sector to leverage the program. Reclamation also constructed a high-
    tech desalination laboratory, entitled the Water Quality Improvement
    Laboratory, on the grounds of the Yuma Desalting Plant. The purpose of
    this facility is to provide a testing ground for new desalination
    improvements as they develop.
    ---------------------------------------------------------------------------
        \1\ Emerging Desalting and Water Treatment Technologies for Water
    Resources Management, Bureau of Reclamation Summary Report, October 17-
    19, Arizona, 1989.
        \2\ Research Needs for Upgrading Sub-Standard Water Supplies,
    Bureau of Reclamation Seminar Summary Report with National Water Supply
    Improvement Association, International Desalination Association
    Conference, Washington, D.C., 1991.
        \3\ Issues Associated with Large Scale Desalination Plants, Bureau
    of Reclamation Seminar Summary Report, National Water Supply
    Improvement Association Biennial Conference, Newport Beach, California,
    1992.
        \4\ Bessler, M.B., National Desalting and Water Treatment Needs
    Survey, Bureau of Reclamation, Desalination Research and Development
    Program Report #2, 1993.
        \5\ Buros, O.K., Desalting as an Environmentally Friendly Water
    Treatment Process, Bureau of Reclamation and American Desalting
    Association Workshop, Desalination Research and Development Program
    Report #13, 1994.
        \6\ Herbranson, L., S.H. Suemoto, Desalination Research--Current
    Needs and Approaches--A U.S. Perspective, Desalination, vol. 96, no. 1-
    3, p 239-248, 1996.
        \7\ Martella, S., Water Reuse Research Needs Assessment Workshop,
    Desalination Research and Development Program Report #19, 1996.
        \8\ Buros, O.K., Research Opportunities at the Yuma Water Quality
    Improvement Center, sponsored with the American Desalting Association,
    Desalination Research and Development Program Report #25, 1997.
    ---------------------------------------------------------------------------
        When the Water Desalination and Research Act of 1996 (Act) was
    enacted, Reclamation developed an overall plan to meet the requisites
    of the Act based upon input from the desalination community. This plan
    is presently being implemented, albeit on a reduced scale as a result
    of existing budgetary demands within the agency and our need to stay
    within our budget allocations.
        Initially, the most significant role for desalination will be
    providing water resources along coastal areas, where populations are
    growing most rapidly and disposal of concentrate is most
    environmentally-friendly. Costs for desalinating water are continuing
    to drop significantly--the most recent contract for delivery of
    desalinated seawater to the City of Tampa, Florida, is $1.71/1000
    gallons ($557/acre ft)--which is within the abilities for many large
    communities to afford. For example, development of new water resources
    in the San Diego area from conventional means is estimated to cost
    $600-$700/acre ft. Using more desalinated resources along coastal areas
    will also provide less pressure on existing inland water resources.
        As outlined in the 1996 Act, R&D will play a significant role in
    continuing to lower the cost and acceptance of desalinated water in
    many communities. Our future efforts, if funding were available, would
    be largely based on the Research Program Plan developed for purposes of
    meeting the requisites of the Act. The following narrative outlines the
    specifics of our future direction and focus.
                             overall program goals
      --develop more cost-effective, technologically efficient, and
            implementable means to desalinate water,
      --increase supplies of water for environmental restoration, and other
            competing needs for the limited and often overextended
            supplies,
      --provide additional cost effective alternatives for water managers,
            regulators, and decision makers,
      --increase the ability of Native American, rural communities, and
            others to economically treat their only source of water to
            potable standards,
      --increase the ability of the United States desalting industry to
            compete throughout the world, by fostering partnerships with
            them to develop new and innovative technologies (patent rights
            belong to the non-Federal partners for all non-Federal
            applications),
      --develop methods to make desalting more efficient through promotion
            of dual-use facilities, in which waste energy could be applied
            to desalting water,
      --develop methods to ensure desalting technologies are
            environmentally-friendly and when possible sustainable,
      --ensure regulations are appropriate for the application by working
            with regulators to fully evaluate effects of concentrate
            streams, capitalizing on the recovery of by-product streams,
            and
      --maximize technology transfer to ensure full transfer of knowledge
            and commercialization of technology.
        To meet these goals, Reclamation has outlined 10 technical/emphasis
    areas which comprehensively should be addressed, in order to make
    desalination a more affordable tool for water resource development and
    management in the future.
                            technical/emphasis areas
        The areas to be explored are listed and described below.
    A. Membrane Process Research and Development Studies
        Research focuses on development of improvements in membrane
    processes for brackish and seawater desalting, and/or removal of
    specific contaminants. The research topics include: development of
    membranes with improved properties, development of membranes with
    increased resistance to chlorine, studies on adhesion of foulant
    materials to membrane surfaces, studies on membrane cleaning, including
    frequency and effectiveness, increase of rates of mass transfer at
    membrane surfaces, studies on pretreatment, and development of improved
    membrane-containing elements or stacks.
    B. Thermal Process Research and Development Studies
        Research focuses on development of improvements in thermally driven
    desalting processes. Thermal processes are generally applied to
    seawater desalting due to the high energy investment. The research
    topics include: improvements and/or cost reductions in multi-stage
    flash distillation, multiple effect distillation, and vapor compression
    distillation; evaluation and development of methods to improve the heat
    economy of thermally driven desalting processes; investigation of
    methods to resolve pre- or post-treatment issues; and investigation of
    methods to reduce the formation of scale and corrosion.
    C. Non-Traditional, and Alternative Desalination Process Research and
            Studies
        Research focuses on investigation of innovative, non-traditional,
    or alternative desalination techniques, including the evaluation of the
    economics and thermodynamic efficiency of these processes. The ultimate
    goal being the development of technologies that are much more cost
    effective than conventional desalination processes. For specific remote
    sites, research of alternative technologies will be considered that
    significantly reduce the capital costs, and operations and maintenance
    of conventional technologies. The research topics include investigation
    of unique solar energy methods and applications, and development of
    new, innovative alternative desalination processes.
    D. Water Recycling and Reuse
        Research and development studies support activities directed at
    innovative methods to treat municipal, industrial, or agricultural
    wastewaters. Projects also include solving specific problems related to
    specific reuse facilities, in order to improve the economics of overall
    operation and maintenance of existing or future facilities. Reclamation
    is presently co-funding the evaluation and construction of a number of
    water recycling projects through authorization under Public Law 102-
    575, Title XVI. Research efforts in support of these projects will be
    of particular interest. The research topics include: investigate
    innovative methods to recycle and reuse municipal, agricultural, or
    industrial process water or waste waters; research studies to remove
    toxic substances from waste water streams, i.e., pesticides, heavy
    metals, radioactive elements, etc.; enhanced membrane characteristics
    for waste water treatment applications; development of low-cost
    treatment methods for high nitrate well waters from farm fertilization
    or livestock operations; development of tools to reduce the public's
    psychological stigmas associated with the reuse of water; developing
    on-line methods for detecting leakage of viruses in reuse facilities;
    and developing ``leak-proof'' recycling treatment technologies.
    E. Ancillary and Economic Improvements (Dual-Use Facilities, By-
            Products Recovery, Cost Evaluations)
        This research task area is three-fold in its direction. First, the
    evaluation of opportunities to promote desalination development in
    combination with new or existing power facilities, in order to create a
    dual-purpose facility. Second, the evaluation of the economic and
    environmental benefits of recovering the byproducts of desalting
    processes. Third, the evaluation of cost to determine which desalting
    process is the most economically feasible for communities under
    different restrictions and localities, as well as economic sensitivity
    analyses of thermal and membrane systems. The research topics include:
    development of more efficient pumps, and energy recovery systems;
    studies on instrumentation and control of desalination systems;
    development of a method to recover commercially marketable minerals
    from a desalination process concentrate stream; and evaluation of the
    effect of feedwater quality and volume on a desalting plant design and
    concentrate disposal cost.
    F. Concentrate Issues
        Research focuses on the various problems related to concentrate
    disposal, and develops innovative techniques to reduce concentrate
    disposal costs and impacts on the environment. The research topics
    include: concentrate disposal systems development; methods to recover
    by-products; salinity modeling and toxicity analysis of concentrate
    discharges to the environment; and wetlands and other non-conventional
    disposal methods. Additional efforts are also directed towards the
    collection of concentrate disposal information that may assist in the
    future development of regulations.
    G. Testing of Laboratory Scale and Pilot Systems
        The work involves the design, construction, and testing of pilot-
    scale systems. Testing of laboratory and pilot systems is generally
    done as a result of previous successful research studies conducted in
    Areas A through F, above.
    H. Partnerships
        This work involves collaborative research efforts between
    Reclamation's program and that of other water research organizations
    outside the government. This provides access to new funding partners,
    to organized groups that need desalination technologies, to highly
    qualified research advisory boards, to the most recent research
    findings, and to new networks of highly qualified researchers. Past
    work has included partnerships with the American Water Works Research
    Foundation, the National Water Research Institute, and two of the
    National Science Foundation Engineering Research Centers.
    I. Technology Transfer
        Technology transfer is key to making the program a success.
    Reclamation has a very ambitious technology transfer effort which
    exploits electronic access of information, as well as more traditional
    means of providing access to all information gained in the research
    program. The Program continues to seek new innovative opportunities to
    provide technology transfer to assist other researchers, private
    industry, academia, municipalities, and small and Native American
    communities. The technology transfer effort includes: an Internet
    website, electronic access to Requests for Proposals, newsletters,
    informational brochures and leaflets, free hard-copy publications of
    all final research reports, videos, technical manuals, presentations at
    technical conferences, yearly workshops, peer reviews, and electronic
    databases.
    J. Design, Construction, and Testing of Plants and Modules
            (Demonstration and Development Projects)
        This technical area has not been funded in the past. The Act
    envisioned funding for demonstration and development to begin the third
    year following the first appropriations for research and studies. The
    Authorization Act requires a report to Congress in fiscal year 1999,
    with recommendations on which projects to further evaluate and
    implement based upon the most successful research findings from the
    Program's research and studies, successful pilot plant research carried
    out by others, and significant input from users and purveyors of
    desalination technology. The type of work involved could include:
    preliminary design studies, detailed design, construction and testing,
    demonstration of by-products recovery, and economic surveys. For future
    years, this area will require significant resources in order to meet
    the intent of the Act.

                     statement of senator robert f. bennett

        Senator Domenici. Senator Bennett.
        Senator Bennett. Thank you, Mr. Chairman.
        I want to take a minute to thank both the Assistant
    Secretary and the Commissioner for their assistance to our
    State in the last year. Water is the most precious commodity in
    the West. We used to have a saying, ``It's better to be head of
    the ditch than head of the Church.'' [Laughter.]
        Given the reputation we have for the power of the Church in
    Utah, that is a pretty strong statement.
        We have had a lot of cooperation from the Bureau of
    Reclamation, and we recognize this and we want to thank you for
    it. We have good people in Utah from the Bureau. My only
    message to you is leave them there. Do not keep transferring
    them in and out. We have had a good experience.

                                 red butte dam

        We have had to call on the Bureau for some input and
    assistance, and you have always been very helpful. Most
    specifically, we had to have an appraisal of the old Army dam
    above Fort Douglas called Red Butte Dam. The Army insisted it
    was not worth very much, and they were a little surprised when
    they found out how much you thought it was worth, or more
    importantly, how much you thought it would take to bring it up
    to the level whereby the Army could have safely disposed of it.
    We are having that fight with the Army in another subcommittee
    as to where we get that money. But these are over and above
    your normal activities and we are very grateful to you for your
    assistance.
        I am glad we were able to help OMB find religion on the
    issue of Dutch John and work that out.

                              central utah project

        Now, I want to quickly reinforce--this will come as no
    surprise to anyone--what some of my priorities are. I was glad
    to hear you, Ms. Beneke, talk about the Central Utah Project.
    The legislative effort for that began some 40 plus years ago
    with my father. I hope the project will be completed before one
    of my grandchildren is elected to the Senate. [Laughter.]

                            salinity control program

        If we can get that one moving along.
        I want to put the Bureau on notice that I recognize that we
    will eventually have to raise the funding level on the salinity
    control program. When that time comes, I will introduce
    legislation to do so, and I hope that the chairman and other
    members of this committee will join me.

                         title xvi water reuse program

        I remain committed to the title 16 water reuse program. I
    will work with the committee to ensure that it is properly and
    adequately funded this year. I know we had a little
    disagreement last year over the interpretations of the formula
    with respect to the Tooele Project. I am glad we were able to
    work that out.
        Now, I also look forward to providing some additional
    funding to a very interesting project that is ongoing near St.
    George where the Bureau, the USGS, and the Water Conservancy
    District are conducting a study on water recharge in the Navajo
    sandstone.
        So, those are all of my parochial items, and I have to get
    them on the record.

                              lake powell draining

        Now, I do want to make one other comment which affects not
    only my State but those from neighboring States. I am sure
    Senator Reid of Nevada has a number of constituents who are
    involved with Lake Powell. Senator Craig has indicated that he
    has vacationed at Lake Powell.
        And I hope the administration will hold firm in its
    position that the Sierra Club's idea of draining Lake Powell is
    absurd. I almost hesitated to raise it today lest I give the
    proposal validity. But I understand that the Sierra Club and
    others in the environmental community have now pegged this as
    their number one fund raising activity. They have raised
    millions of dollars trying to tell us how to handle Utah
    wilderness, and now they want to raise millions more telling us
    to get rid of the dam at Lake Powell.
        I will just share with you this experience that I had over
    the weekend. I found myself in an airport, not an unusual
    situation for Senators, and my flight was delayed, which is
    also not an unusual situation for Senators. I picked up one of
    the free newspapers that was sitting there called the Earth
    Times in order to have something to read while I waited for the
    equipment to show up.
        There was a lead editorial that caught my eye, and it was
    attacking the Green Party in Germany. I thought this is a
    little unusual for the Earth Times to be attacking the Green
    Party. The burden of the editorial was that the Green Party
    was, in fact, going to add to pollution and to upset the Kyoto
    Accords because they were demanding the dismantling of all of
    the nuclear plants in Europe. And the editorial said that may
    be well and good because we all hate nuclear plants, but if you
    dismantle all the nuclear plants, you are going to have to
    replace the power somewhere and it will be coal-fired plants
    that will upset the Kyoto Accords. Therefore, we ought to
    swallow hard and leave the available source of power in place.
        You know, that applies to Glen Canyon Dam and Lake Powell,
    because it currently supplies recreation to 3 million visitors
    and power to half a million homes. I remember during the debate
    when the dam was being built, the Sierra Club came in and
    opposed it. Ultimately they made a deal to accept it, which
    they now say is one of their biggest mistakes. But their
    argument was that that power was not needed. They said, we have
    got plenty of energy in this country. The time will never, ever
    come when we have an energy shortage, and to build a dam to
    provide excess energy at a time when we have too much is really
    foolish. But if the time should ever come, if in fact we should
    ever need that energy, clearly we do not need to build the dam
    because there at Kaparowitz there is plenty of coal and we
    could burn all the coal in Kaparowitz to provide the power and
    not have to worry about the dam. Now, everybody who knows
    anything about environmental issues in Utah knows how
    enthusiastic the Sierra Club now is about burning coal at
    Kaparowitz.
        So, taking a cue from the lead editorial in the Earth
    Times, I tell you leave the dam in place, provide the power,
    and let the 3 million visitors continue to enjoy their
    experience in southern Utah.
        I have nothing further, Mr. Chairman.
        Senator Domenici. Thank you very much, Senator Bennett.
        Senator Craig?
        Senator Craig. Thank you very much, Mr. Chairman.
        I had the privilege of visiting with these folks last week
    before the Energy and Natural Resources Committee, and it was
    at that time, Mr. Chairman, that we discussed issues pertinent
    to their budget and to my State of Idaho. So, with that, what I
    had said last week I will just simply underline this week as
    being important to our State, especially the Fremont-Madison
    Irrigation District exchange that is coming on board now as an
    opportunity, certainly along with what we are doing and what
    the Bureau of Reclamation is doing in cooperation with all the
    other agencies in the Snake-Columbia system to find additional
    waters for the purposes of fish mitigation in the Snake and
    Columbia system.
        All I can say is proceed with caution. Do not dewater the
    State of Idaho. We spent the last 100 years cooperating with
    the Bureau of Reclamation and others to build water facilities
    in our State to make it bloom. We are not about to start
    dewatering the State and return it to a desert environment.
        And, yes, I enjoy Lake Powell. [Laughter.]
        Thank you very much, Senator.
        Senator Domenici. Are you finished?
        Senator Craig. I am.
        Senator Domenici. Senator Dorgan.
        Senator Dorgan. Mr. Chairman, thank you.
        I also had an opportunity last week to visit briefly with
    the Commissioner and the Secretary on a number of issues.
        Let me just ask a couple of brief questions, if I might.
        I regret I was delayed. I had a group in my office that I
    could not escape from. I have read your testimony and
    appreciate all that you do.

                              dakota resources act

        As you know, one of the issues that we will deal with this
    year is the change in the authorization of Dakota Water
    Resources Act. You have included an amount of money in this
    year's budget, I believe $27 million for the Garrison project,
    under the Dakota Water Resources Act. We face the problem that
    many States out in our region face, of water development needs
    that are quite critical.
        Let me just show you a couple of samples of water that I
    thought you would find interesting. This is from Keith and Ann
    Anderson's house in Scranton, North Dakota. This looks like the
    coffee that Senator Domenici drinks in the morning. Maybe yours
    is stronger than this.
        Senator Domenici. Yes.
        Senator Dorgan. And this is Leonard Jacobs' farm water.
    This is from Reeder, North Dakota, just south of where I grew
    up.
        Senator Reid. A lot of iron in that water.
        Senator Dorgan. Well, there is a lot of something in that
    water.
        Senator Domenici. That is potable water?
        Senator Dorgan. That is the water they used to have on
    their farm.
        Now, that has changed, and here is what Leonard Jacobs has
    now, and it comes, as the Secretary and Commissioner know,
    because the Southwest Pipeline, which came through the
    appropriation of these water projects, has transferred this
    kind of water to these farmsteads in southwestern North Dakota.
        Senator Reid. You could not drink that, could you?
        Senator Dorgan. Well, I could not.
        Senator Bennett. Maybe with a blindfold.
        Senator Dorgan. But the fact is we have a lot of
    communities with very unhealthy water, and that is one of the
    advantages of being able to move water from the Missouri River
    behind the dam through the State into areas that have terrible
    water quality, refreshing that opportunity with good quality
    water.
        I just wanted to show you the results of what we are doing
    together and to ask you your assessment of our ability to work
    together on this reauthorization this year because that is the
    key to future funding. Can you just give me a comment on that?
        Ms. Beneke. Well, Senator, as we have discussed in the
    past, we are committed to working with you on this important
    project. I have a real appreciation for what it means to your
    home State. I actually hail from the central part of the
    country myself and am familiar with rural communities. I also
    got to drink my share of well water when growing up. So, I do
    have an appreciation for what it means. And we very much want
    to work with you this year.

                          mr&i needs of indian tribes

        Senator Dorgan. One of the other issues that is a problem
    for us is the funding priorities that were outlined in the 1986
    Reformulation Act was meeting the MR&I needs of the Indian
    tribes. The tribes have reached their funding ceilings which
    has been a problem, and we are trying to identify additional
    resources for them. I mentioned some of these farmsteads and
    the critical water needs, but you are well aware, I know, of
    the needs on the Indian reservations. And I hope that we could
    work with you, Madam Secretary, and also the Commissioner on
    those issues.

                      red river vally water needs studies

        One final question. The Bureau of Reclamation has been
    studying the water development and management needs of the Red
    River Valley now for the past year. Can you give us the status
    of those studies, tell us where you are, and what we might
    expect?
        Mr. Martinez. I do not have that information in front of
    me, but I understand two of the studies are complete. The third
    study is ongoing. One was a needs assessment study, and the
    other one is on the particular projects that might deliver the
    water that is needed. I will get that answer for the record.
        Senator Dorgan. I appreciate that, and I hope you can
    continue to make that a top priority, because the results of
    those studies will help us on this reformulation prospect and
    the timing is very important.
        Mr. Martinez. Yes, Mr. Dorgan.
        Senator Dorgan. Let me again, Mr. Chairman, thank the
    Secretary and the Commissioner. You work in a tough area with
    unlimited wants and limited resources, and I appreciate the
    work you do. Mr. Chairman, thank you.
        Senator Domenici. Thank you very much.
        [The information follows:]

                      Red River Valley Water Need Studies

        The Phase IA Needs Assessment has been completed and the Phase IB
    Instream Flow report will be finalized by the end of March 1999.
    Reclamation has been working closely with State and local interests to
    obtain their views and recommendations.
        Reclamation's work is coordinated with a steering committee, which
    is comprised of representatives of the North Dakota State Water
    Commission, North Dakota State Health Department, the Garrison
    Diversion Conservancy District, Fargo, Grand Forks, Moorehead, rural
    water systems, and the environmental community.
        Initial alternatives to meet the municipal, rural, and industrial
    water needs of the Red River Valley have been formulated. A working
    draft of the Phase 2 (Alternatives Analysis) report was forwarded to
    the Steering Committee prior to our March 30 meeting. It is expected
    that more meetings may be needed to assure that the views and interests
    of the State and local interests are fully considered prior to
    distribution of the public review draft.

                                 safety of dams

        Senator Domenici. Let me ask a couple general questions
    first. Commissioner, you indicated that one of your big
    responsibilities is to see to it that the structures that you
    manage and supervise are safe.
        Mr. Martinez. That is correct.
        Senator Domenici. Now, if I were to say to you, give us
    proof that they are safe, what would you give us?
        Mr. Martinez. When I became Commissioner of Reclamation, I
    was concerned about our Dam Safety Program and the safety of
    our structures, and I empaneled five experts from outside the
    Bureau of Reclamation to review our program and our facilities.
    The report was quite favorable. I have implemented quite a few
    of their recommendations.
        Senator Domenici. So, since we would like very much never
    to be shocked by having a dam failure--and we have you up here
    every year to talk with us--what could you give us for the
    record indicating that? Could you put some things in the record
    here within the next couple of weeks indicating why the
    Department of the Interior, Bureau of Reclamation says it has
    safe structures and is doing what they ought to do?
        Mr. Martinez. Well, yes, I can, but I will not sit up here
    and say that I do not guarantee that----
        Senator Domenici. Oh, no, no.
        Mr. Martinez [continuing]. We might not lose a structure
    some day because of an earthquake and so forth. But I think
    that we have a very effective program and will continue to put
    our resources in that program with your assistance. And I will
    provide that information to you.
        Senator Domenici. Would you, please? I just mean that I
    think we have a responsibility as an oversight entity to get
    this information in the record so that we are going along with
    you in that regard.
        [The information follows:]

                               Dam Safety Program

        Reclamation cannot guarantee that there will be no dam failures.
    However, Reclamation diligently strives to have a strong Dam Safety
    Program to manage the risks associated with dams in order to keep that
    chance of dam failure as low as reasonably possible.
        In 1997, the Commissioner tasked an independent team of dam safety
    professionals to review Reclamation's dam safety practices to identify
    best practices already in place and to make recommendations for
    improvements. The peer review concluded that Reclamation has a strong
    dam safety program and made recommendations for further improvements.
    Thirty-three peer review findings have already been addressed. The
    twelve remaining findings are under review and scheduled to be
    addressed during 1999.
        Program improvements that have been implemented as a result of the
    peer review findings and Reclamation's own internal initiatives that
    received peer review endorsement include:
        1. The appointment of a Dam Safety Officer to provide independent
    advisory and guidance for achieving program vigilance.
        2. The procurement of a standing review board of independent dam
    safety consultants to review program practices that have occurred on
    individual dams.
        3. Annual dam safety meetings to review dam safety issues and
    actions on each dam with Reclamation management.
        4. The updating of Emergency Action Plans for each dam and
    exercising the plans with downstream communities.
        5. Enhancements to the facility review, performance monitoring, and
    engineering analysis activities in order to more reliably identify and
    manage dam safety issues.
        The fiscal year 2000 budget request includes these program
    improvements intended to continue a strong Dam Safety Program. The
    fiscal year 2000 budget request also includes funding for modifications
    to reduce the risk of dam failure on dams having identified critical
    dam safety issues; such as Keechelus Dam, Yakima Project, Washington;
    and Casitas Dam, Ventura River Project, California which require
    modifications of significant cost and scope.
        In order to continue to fund Safety of Dams modifications in the
    future, additional legislation will be needed to increase the
    authorization ceiling provided under the 1984 Safety of Dams Act
    Amendment. Current estimates indicate that sufficient ceiling remains
    to fund necessary modifications and associated ongoing commitments
    represented by the fiscal year 2000 request. However, projections
    indicate that the total cost for new modifications identified for
    fiscal year 2001 could begin to exhaust the remaining ceiling.

                               drought assistance

        Senator Domenici. Now, let me change to a situation that is
    evolving in the Southwest, but is almost upon us in New Mexico.
    The dread word of ``drought'' is just--all you have to do is
    fly into New Mexico and you think you are approaching the
    desert, although we are not a desert State. Drought is the kind
    of disaster that is very difficult for the people, because it
    does not occur overnight. It sort of creeps upon you, and it is
    creeping upon our State. I do not know if it is on others too.
        What are you doing with reference to the drought, for
    drought for a State like ours which has very little water?
        Mr. Martinez. Mr. Chairman, if you recall in 1996, through
    your assistance, we had some funding to work under our drought
    assistance program. Since then we have been working with the
    southwestern States to help in their water planning process. As
    a matter of fact, we have given the State of New Mexico two
    grants. They have put in place a planning process on how to
    respond to drought. So, we have been working in that area.
        You are correct that we expect droughts in the American
    Southwest this summer. Our budget will reflect a request for
    drought money. This budget was put together before conditions
    that came up this year. We have, I believe, about $100,000 left
    in our budget from prior appropriations. I understand I have
    some reprogramming authority, but the requests that are being
    made today are probably going to exceed our ability to respond
    if we do have a drought situation in the American Southwest
    this year.
        Senator Domenici. Before we mark up our bill, I wonder if
    it would be possible for you to gather up the resources through
    your information and some statements to us with reference to
    what kind of authority you might need and what kind of changes
    that might occur. Could you do that for us?
        Mr. Martinez. Yes, Mr. Chairman. I think the authority is
    in place. What we would need would be the financial resources.
        Senator Domenici. All right, and can you give us some idea
    later what that might be?
        Mr. Martinez. I will provide that for the record.
        Senator Domenici. I appreciate it.
        [The information follows:]

                                Drought Funding

        Reclamation is currently experiencing drought conditions in several
    of its Southwestern states mostly due to below normal rainfall. While
    some areas are less severe than others, there is a real need to provide
    emergency assistance and relief. In the past, up to $30 million has
    been appropriated to the Bureau for drought emergency assistance. In
    fiscal year 1999 carryover funds of $673,754 will be insufficient to
    provide the necessary drought relief to the Southwest. The fiscal year
    2000 President's budget includes $500,000 for the Drought Emergency
    Assistance program. However, we would like to work with the Committees
    to discuss funding levels that would be needed to address the drought
    emergency situations that now exist and those that are developing.

                                 desalinization

        Senator Domenici. With reference to desalinization, I am
    fully aware that Senator Simon got an authorization bill
    through and a little bit of money, but I think what has
    happened to desalinization is that it is spread all over, even
    though it is a very small program. I am just wondering if it is
    not exclusively the Department of the Interior's mission. Is
    there some way to focus the money, and if the Bureau of
    Reclamation is the right place to do that. Would you have any
    thoughts on that, Patty?
        Ms. Beneke. Senator, I think that we should take a look at
    the program. We, of course, want to make sure that we are
    getting the maximum benefit for every research dollar we put
    into it. Reclamation does have a lot of expertise in this area,
    and I guess my off-the-cuff reaction would be that it is an
    appropriate place for the program to be lodged. But we would be
    happy to work with the subcommittee and incorporate any ideas
    you might have regarding how we can----
        Senator Reid. Would the chairman yield? Also, I have asked
    Commissioner Martinez to submit to us his view as to what
    should happen to the program. Also, if you would, give us an
    idea of what is happening with desalinization any place else in
    Government. I think it is something we need to take a look at.
    On a mini-level, it is kind of like global warming. We have a
    lot of people doing a little bit of nothing, and we need to
    gather them all together, and maybe one organization can do
    more than spread out the way it has been.
        Mr. Martinez. Mr. Chairman, if I may respond to that. I
    think the research in this particular area is very crucial,
    especially in New Mexico. We have large groundwater aquifers
    that have impaired water quality. The issue is the economic
    cost of treating that water, and I think that in the future
    that has great promise.
        I would agree that there are probably programs across the
    Federal Government that could be consolidated and made more
    efficient.
        Senator Reid. You will let us know.
        Mr. Martinez. Yes, sir.
        Senator Domenici. So, now we understand, based on Senator
    Reid's inquiry, Madam Secretary, you are going to go through
    the Government and break out for us where any desalinization
    research money is. Is that correct?
        Ms. Beneke. Yes. We will do our best to make a review of
    that.
        Senator Domenici. And if you need our help, we would be
    glad to ask the Director of OMB to do that with you if you
    want. You can do it on your own. If you need our help, we will
    ask him.
        Ms. Beneke. Thank you very much.
        Senator Domenici. I concur that with water shortages in the
    Southwest, it is rather dismal that the research has still not
    made a major breakthrough for our country. We have not funded
    it well enough, and if we put some our talented people on it,
    we are going to find some way to fix this, I am sure.
        [The information follows:]

                 Desalination Funding in the Federal Government

                                  introduction
        The Bureau of Reclamation has a major role among the federal
    agencies in desalination research, development, and demonstration.
    Other agencies use and adapt the technologies to meet their missions.
    Many years ago it was recognized that a potential existed within the
    federal government for duplication of this effort. As a result, the
    Bureau of Reclamation and the U.S. Army Tank-Automotive Research,
    Development, and Engineering Center created the Interagency Consortium
    for Desalination and Membrane Separation Research in 1992.\1\ Since
    that time, the Consortium has met yearly to discuss individual projects
    being carried out by the agencies and the future directions of their
    programs.
    ---------------------------------------------------------------------------
        \1\ Bagwell, T.H., M.K. Price, The Interagency Consortium for
    Desalination and Membrane Separation Research, Desalination, vol.99,
    no.2-3, p 195-199, 1994.
        Price, M.K., The Various Programs in Membrane Water Treatment
    Research Provide and Insight to Areas Where Further Innovation is
    Needed, The 1996 Fourteenth Annual Membrane Technology/Separations
    Planning Conference, Business Communications Co., Inc., Newton, MA,
    1996.
    ---------------------------------------------------------------------------
        The Consortium members work together to establish a communications
    network that has the following benefits:
      --Prevent federal duplication of efforts,
      --Pool limited federal research funding and other resources to obtain
            common goals,
      --Identify future research needs, and
      --Allow for discussion of new technologies with other experts in the
            field.
        Within the past year, the Army has worked with Reclamation and the
    Navy in its' procurement of new technologies. Reclamation has assisted
    National Institute of Standards and Technology (NIST) in the selection
    of proposals for their Advanced Technology Program. NIST also designed
    their membrane research program not to overlap with Reclamation and
    specifically excluded water treatment applications. The other agencies
    have provided advice and information to Reclamation to assist in the
    formulation and management of the Desalination Research and Development
    Program.
              desalination funding in federal government agencies
        The table below indicates the level of funding for desalination
    technologies within the federal government. The information in the
    table is based on a recent telephone survey of agency program offices.
    Several themes became evident as this information was collected. First,
    the military is spending the most money. Second, the work being done in
    the other agencies is very mission specific. For instance, the Army's
    mission is to provide safe drinking water for troops in the field. This
    is done by using commercial desalting technologies and making them
    deployable, light weight, mobile, self-powered, rugged, and able to
    treat all waters. The Navy is responsible for providing shipboard water
    and wastewater treatment starting with commercially available
    technologies. The EPA develops regulations and they generally test and
    demonstrate technologies related to the enforcement of the regulations.
    This also involves testing commercial products. Currently, they are
    doing no desalination work. The Department of Energy's laboratories are
    looking at environmental remediation and waste management technologies.
    Their work is related but not directly supportive of desalination
    technologies. The one agency that could have a large impact on the
    sustainability of advanced water treatment, National Renewable Energy
    Laboratory, has no funding to combine desalination with renewable
    energy at this time. A third theme came from several of the agencies.
    They look to Reclamation's program for development of desalination
    innovations, since the other agencies' work consists of engineering
    modifications to commercially available desalination products. Fourth,
    the cost of developing new desalination technologies does not come
    cheaply. For instance, the Defense Advanced Research Projects Agency is
    funding three projects to develop a handheld desalination device. Each
    of these contracts cost $500,000.
                                    summary
        While many federal agencies outside the Defense Department apply
    desalting technologies in carrying out their missions, they are
    dependent upon what is available commercially. Reclamation's
    desalination research and development program is the only federal
    program devoted to reducing the costs of desalination through research,
    studies, development, and demonstration. Reclamation's program benefits
    not only the federal agencies in carrying out their mission, but also
    the public who need additional supplies of clean water.

           DESALINATION FUNDING BY FEDERAL AGENCY IN FISCAL YEAR 1999
    ------------------------------------------------------------------------
                                         Fiscal year
                  Agency                 1999 desal       Example projects
                                           funding
    ------------------------------------------------------------------------
    Defense:
        Army \2\.....................        $370,000  SIBR contract for
                                                        handheld desal
                                                        device.
                                            1,100,000  Lightweight tactical
                                                        water purification
                                                        system development
                                                        125 gallon per hour.
                                              120,000  Parts/support for
                                                        older desal systems.
                                            1,800,000  Complete development
                                                        of 1,200 gallon per
                                                        hour tactical water
                                                        purification system.
                                              900,000  Cost reduction
                                                        studies of existing
                                                        desal systems.
                                            1,500,000  Work with Navy on new
                                                        desal and wastewater
                                                        treatment and reuse
                                                        systems.
        Corps of Engineers \3\.......  ..............  .....................
        Defense Advanced Research           1,500,000  Three contracts for
         Projects Agency \2\.                           handheld desal
                                                        devices under
                                                        mesoscopic
                                                        equipment.
        Navy--Marine Corps \4\.......  ..............  Do support work for
                                                        Army.
        Navy--ships \5\..............   \6\ 1,000,000  Application of
                                                        current technologies
                                                        to shipboard use.
    Commerce:
        Advanced Technology Program    ..............  Specifically excludes
         \7\.                                           water research.
        U.S./Israel Science and               ( \6\ )  Past work has
         Technology Commission \8\.                     included $3,000,000
                                                        for Enhanced
                                                        Seawater Desal,
                                                        project complete.
    EPA \9\..........................  ..............  .....................
    Energy:
        Argonne \10\.................  ..............  .....................
        Livermore \11\...............  ..............  Past work has
                                                        included capacitive
                                                        deionization desal
                                                        research.
        Nat Renewable Energy Lab \12\  ..............  .....................
    Interior:
        USGS \13\....................  ..............  Use commercially
                                                        available products.
        National Park Service \14\...  ..............  Use commercially
                                                        available products.
    BOR..............................       2,360,000  .....................
    CDC and NIH \15\.................  ..............  Use commercially
                                                        available products.
    NASA \16\........................  ..............  .....................
                                      ----------------
          TOTAL......................      10,650,000
    ------------------------------------------------------------------------
    \2\ Personal communication with Jay Dusenbury, TARDEC, Army, Michigan.
    \3\ Personal communication with Steve Maloney, Corps of Engineers,
      Illinois.
    \4\ Personal communication with Mark Silbernagel, Naval Facilities
      Engineering Service Center, California.
    \5\ Personal communication with Ivan Caplan, Naval Surface Warfare
      Center.
    \6\ Estimate.
    \7\ Personal communication with John Pellegrino, NIST, Colorado.
    \8\ Personal communication with Duane Lee, Parsons Engineering, working
      under contract to Commerce.
    \9\ Personal communication with Steve Clark, EPA Washington; Jeff Adams
      EPA Drinking Water Research, Ohio; Tom Sorg, Marc Parrotta, and Bob
      Bartian.
    \10\ Personal communication with James Frank, Argonne National
      Laboratory.
    \11\ Personal communication with Jeff Richardson, Livermore National
      Laboratory.
    \12\ Personal communication with John Anderson, National Renewable
      Energy Laboratory.
    \13\ Personal communication with Yousif Kharaka, USGS, California.
    \14\ Personal communication with Craig Patterson, NPS, Colorado.
    \15\ Personal communication with Anita Highsmith, consultant, previously
      with NIH, Georgia.
    \16\ Waiting for response from NASA.

                             san juan river project

        Senator Domenici. I'm going to go through five or six New
    Mexico projects quickly. The San Juan River-Gallup, Mount
    Taylor pipelines which are trying to bring water to Navajo
    country and to the City of Gallup. We have been funding the
    proposed San Juan River project for quite some time,
    Commissioner.
        Mr. Martinez. That is correct.
        Senator Domenici. They are back before us--the Navajo
    Nation is and the City of Gallup--asking for some additional
    funding. I guess they have a new idea. The new approach is
    different than the one we funded 10 years ago and we did not
    get anywhere. I am very concerned. I am wondering what your
    thoughts would be about us having the Navajo Nation and the
    City of Gallup and the Bureau of Reclamation enter into an
    agreement that would say what we are doing and what the parties
    will do in the event it becomes feasible. I am kind of
    concerned that people change this plan so much. It seems like
    all we are doing is funding planning, and now we have yet
    another plan. So, could you comment on that?
        Mr. Martinez. Yes, Mr. Chairman. My briefing also indicates
    that this has been being planned since the 1970's.
        Senator Domenici. You got it.
        Mr. Martinez. I commit to you to personally get involved in
    this issue and put together a proposal for you that will make
    some sense as to where we head in the future.
        Senator Domenici. Well, I want you to know that I intend to
    write a letter--and I will send a copy of it to you--to both
    the entities in New Mexico suggesting that I do not think we
    ought to fund it anymore, unless we have an agreement up front
    as to what we are trying to do.
        Mr. Martinez. That is correct.
        Senator Domenici. And they would then agree to be bound by
    it. I just cannot see some more money unless that is going to
    happen.

                            indian water settlements

        Let me talk a minute generally about Indian water
    settlements. This is one of the potential jobs you have in the
    future that could get very big to be an integral part of the
    Indian water settlements, if they occur. Is that correct?
        Mr. Martinez. Yes. We are engaged in providing technical
    support to the Federal negotiating committees, as well as
    building some projects as a result of water rights settlement
    acts enacted by Congress. And I see a role for the Bureau of
    Reclamation in this area.
        Senator Domenici. We have a Taos Indian settlement brewing.
    Could you just give us a brief update on that?
        Mr. Martinez. Yes. We are involved. We had a $2 million
    appropriation in this year's budget under the Upper Rio Grande
    project for the Bureau of Reclamation that will be used for
    drilling some wells. I am advised that the project sponsors
    might be looking for some additional resources to do some
    modeling studies that result from the information gained from
    drilling these wells.

                          bay-delta ecosystem funding

        Senator Domenici. It has been hinted that the role of the
    Bureau of Reclamation is changing rather dramatically. I think
    that is the understatement of the world. If the Bureau of
    Reclamation was doing what it has always done, its budget would
    be a much smaller this year. But you have been assigned some
    new responsibilities. As a consequence, I believe we have some
    pretty serious oversight responsibilities with reference to
    that new role. You are now doing very large environmental
    projects and wetlands projects, which I have no objection to at
    all, but I want to go through a few of these very quickly, if I
    could.
        What is the total level of funding being requested by the
    Bureau for the ecosystem related activities in the Bay-Delta
    region? How much is being requested for other agencies within
    the Department of the Interior and Government-wide for these
    type of activities? And could you provide us with a crosswalk
    for the record which shows the 2000 funding requests for
    ecosystem related work in the Bay-Delta by agency?
        Ms. Beneke. We can certainly provide the crosswalk for you,
    Mr. Chairman. The total request for the ecosystem restoration
    program in the Bay-Delta is $75 million, which is the same
    amount as was actually appropriated for fiscal year 1999.
        Senator Domenici. And you will tell us how much is
    elsewhere in Government, if you can.
        Ms. Beneke. Yes. I can do that. The California Bay-Delta
    Environmental Enhancement Act that was passed by Congress--I
    think it was late 1996--authorized the Secretary of the
    Interior to select projects for this purpose. So, the program
    is lodged within the Interior Department at this time and the
    Bureau of Reclamation.
        [The information follows:]

                          Bay-Delta Funding by Agency

        Fiscal year 2000 funding for ecosystem related work in the Bay-
    Delta by agency has not been determined by CALFED at this time. Funding
    provided to the Bureau of Reclamation for activities in support of the
    CALFED/Bay-Delta program include three accounts as follows:

    U.S. Bureau of Reclamation..............................    $117,192,000
        California Bay-Delta Ecosystem......................      75,000,000
        Water and Related Resources.........................      16,317,000
        CVP Restoration Fund................................      32,246,000

        The CALFED Bay-Delta programs builds on numerous Federal and State
    programs addressing water management, conservation and water quality,
    as well as aquatic species and habitat conservation. Other Department
    of the Interior agencies supporting the CALFED effort are the U.S. Fish
    and Wildlife Service and the U.S. Geological Survey. In addition to
    their routine operation of refuges and habitat management, the U.S.
    Fish and Wildlife Service requested $2.1 million in fiscal year 2000 to
    provide technical assistance for activities supporting the conservation
    and recovery of migratory birds, sensitive, threatened and endangered
    species, and other trust species in the Bay-Delta watershed. They also
    participate in the CALFED program for habitat restoration in areas such
    as planning, assistance, review, and permitting and implementation. The
    U.S. Geological Survey request includes an estimated $3.5 million for a
    variety of studies covering water resources, wetlands, contaminants and
    salinity, and biological research that will contribute to solutions to
    the problems in the Bay-Delta.
        Agencies outside of the Department of the Interior provide CALFED/
    Bay-Delta support as follows: The Environmental Protection Agency
    anticipates that significant funding in Clean Water Act and Safe
    Drinking Water Act program grants provided to California could be used
    for the water quality portion of this program. They are currently
    involved in the development of wetlands and drainage management
    projects throughout the Delta and its tributaries. The Natural
    Resources Conservation Service plans to provide funds to Resource
    Conservation Districts for riparian, watershed, agriculture water run-
    off, and other ecosystem restoration activities in the Delta. The
    National Marine Fisheries Service requested $1.4 million in their
    appropriation to support a number of relatively small ecosystem related
    studies in the Delta. And the U.S. Army Corps of Engineers anticipates
    funding approximately $12.4 million in fiscal year 2000 for ecosystem
    restoration projects along the Sacramento River that include levee
    rehabilitation, flood control projects, and restoration of seasonal and
    permanent wetlands.

                     calfed appropriations and expenditures

        Senator Domenici. Now, let us move on to CALFED for a
    moment. Now, of the $160 million appropriated to date for
    CALFED, how much has been obligated and expended?
        Ms. Beneke. Well, in fiscal year 1998, there was $85
    million appropriated. Of the $85 million, all of it has been
    allocated to either programs or projects. $73 million has been
    obligated.
        Senator Domenici. How much?
        Ms. Beneke. $73 million.
        Senator Domenici. Thank you.
        Ms. Beneke. By that I mean that it is either under contract
    with a third party or under an agreement with another agency to
    implement a program or projects.
        For fiscal year 1999, $75 million was appropriated. $64
    million of this has been allocated to projects or programs. We
    go through a fairly extensive project selection process, a
    public process. There is stakeholder participation. There is an
    integration panel that reviews these projects to make certain
    that they are consistent and coordinated with our other
    authorities and spending. There are technical screens that are
    undertaken, and then the Secretary approves the projects.
        At any rate, $75 million was appropriated, and $64 million
    has been allocated to projects or programs. None of this has
    yet been obligated, but we are working on our interagency
    agreements and on our contracts as we speak, and we feel fully
    confident that it will be obligated by the end of the fiscal
    year.
        The expenditure rate is much lower, but I would encourage
    the subcommittee to focus on our obligation rate.
        There are some reasons that our expenditures are lower, Mr.
    Chairman. For one thing, most of these projects are done on a
    3- to 5-year contract basis and we do not prepay the contracts.
    So, we do not expend the money as quickly as we otherwise
    might.
        In addition, CALFED typically has the funding for the
    entire project in place before the project starts. We have all
    the money up front before we engage in our 3- to 5-year time
    horizon for these projects.
        At any rate, the current amount that has actually been
    expended to date is $6.4 million of our 1998 appropriations.
    But again, I would hope that the subcommittee would be looking
    more closely at our obligation rate.
        Senator Reid. Mr. Chairman, if I could just interrupt, and
    I apologize. I would like to apologize to Dr. Westphal and
    Lieutenant General Ballard for not being able to be present
    during their testimony. I indicated to you earlier that I would
    like to submit my questions in writing on the Corps of
    Engineers, and with your permission, I will do that.
        Senator Domenici. It will be done.

                              calfed expenditures

        I am sorry to keep going, but some of these have to be
    asked.
        Would you state the amount of expenditures out of this $160
    million appropriated again please?
        Ms. Beneke. To date it is $6.4 million, sir.
        Senator Domenici. $6.4 million.
        And you suggest that we should not be concerned about that
    low level of expenditure?
        Ms. Beneke. Well, I am suggesting that there are some good
    reasons for it. The first fiscal year that we received
    appropriated funds for this project was 1998, and there was
    some start-up time associated with getting our project
    selection process in place. As a manager I think that taking
    some time to get this process in place and do it right was the
    prudent thing to do. We are talking about large sums of money.
    We want to be very responsible about how we administer them.
        So, again, we do not prepay our contracts. There was start-
    up time associated with getting this program underway. We have
    it up and running now. We think it is running smoothly. Again,
    I would encourage the subcommittee to focus more on our rate of
    obligation rather than the actual dollars that have gone out
    the door.
        Senator Domenici. Well, I just want to give you my version.
    Frankly, we have a very tight budget in every area. The
    chairman of the Appropriations Committee has been greatly
    concerned--he is sitting here--whether we have enough money to
    allocate among the subcommittees to get our job done this year.
        When you have $160 million obligated to a program that was
    declared to be somewhat of an emergency, a very high priority
    and you have spent $6.4 million, it seems to me we have picked
    out a program in government to advance fund in a very different
    way than we do many other things: just put $160 million out
    there and say whenever you get ready to use it, you use it. I
    would almost think that sooner or later we are going to ask you
    to give us a schedule of what is it you are going to use this
    for. If we are just out there fishing around for projects, then
    we have just opened a door to projects that nobody else gets in
    this country. Other projects do not get that opportunity.
        Ms. Beneke. Well, I appreciate the concern that you are
    raising, sir, but I do want to assure you that the projects
    have been selected. We have 171 projects that have been funded
    either through these funds or in cooperation with the State or
    other non-Federal partners. There are specific projects
    selected, specific projects that are underway, specific
    projects that have been contracted for, and we think that they
    are very important to the overall progress that we can make in
    this program.
        Senator Domenici. Does the new Governor of California
    support the ecosystem restoration activities as currently
    structured and the non-ecosystem components proposed for the
    2000 budget, including water supply, storage, and conveyance?
        Ms. Beneke. We have been working very closely with Governor
    Gray Davis and his new team. Last year, Secretary Babbitt made
    a personal commitment to making progress on this program. We
    had partnered very closely with Governor Wilson. We feel fully
    confident that Gray Davis and his team are supportive of this
    request, and we will continue our good partnership with the
    State of California.
        Senator Domenici. The answer, however, is they do not yet
    do that. They are not yet supporting it.
        Ms. Beneke. Oh, no. I am confident that they do support it,
    sir.

                   bureauwide operation and maintenance costs

        Senator Domenici. I just have three more. The conference
    report on the 1998 energy and water appropriations bill asked
    the Bureau to prepare a report on the operation and maintenance
    costs of its projects. The committee requested the report
    because of expressed concerns related to how the O&M costs were
    being allocated by these projects, the declining level of
    operation and maintenance funding for traditional water supply
    and distribution related work, concerns that Reclamation's
    overhead expenses may be excessive, and the lack of opportunity
    of stakeholders to have input into the formulation of the
    budget recommendations. The report was completed and provided
    to the Committee last September, for which we are grateful.

                   stakeholders' input into budget priorities

        What has the Bureau done to afford the stakeholders an
    opportunity to have input into the budget needs and priorities
    since you gave us that report? Can the Bureau benefit from this
    increased openness? Do you expect to learn new ways and
    approaches that could improve efficiency and thereby reduce O&M
    costs?
        Mr. Martinez. Mr. Chairman, I have put out a memorandum, a
    letter, a directive to our regional directors and area managers
    to engage our customers in the budget formulation process and
    how we do our O&M. We have been doing some of that across the
    West, but not in all places. I would expect that we would
    improve both in how we do our work and how much it takes to do
    our work.

                       staffing levels for o&m activities

        Senator Domenici. Well, let me just have one last word in
    that regard and give you an example. The O&M cost report
    indicates that the Bureau of Reclamation is continuing efforts
    to control costs by reducing staffing. However, the Family Farm
    Alliance has provided information indicating that the San Luis
    and Delta-Mendoto Water Authority was able to accomplish
    operation and maintenance work with 85 regular full-time
    employees compared to 120 Reclamation employees.
        Does Reclamation have procedures to periodically review and
    assess manpower being used to accomplish O&M activities, and
    have you reviewed situations like this one that I have just
    talked about?
        Mr. Martinez. I have not personally reviewed any of those,
    but given the constraints on our budget, we review our needs
    and our resources. There are some places we could probably
    improve. In particular, I draw to your attention the concerns
    raised by the irrigation district where we met with them on a
    one-to-one basis and reduced costs.
        I think there is room for improvement. We operate, I
    believe, 89 major projects across the West. Some of them are
    probably doing a good job. Some places, I think, we could stand
    some improvement, and we are moving in that direction.
        Senator Domenici. That is all the questions I had.
        The two Senators who arrived, do you want to question the
    Bureau or were you here for the Corps? Go ahead, Senator Burns.

                           statement of senator burns

        Senator Burns. Thank you very much.
        How are the kids? Are the kids all right?
        Ms. Beneke. Fine, thank you, sir.
        Senator Burns. I have to ask her that every time I see her.
        I thank you for coming today and thank you, Mr. Chairman. I
    just have a couple of questions and I have a statement, if I
    may be allowed to put it in the record.
        Senator Domenici. The questions will be made part of the
    record.
        Senator Burns. I am concerned about the $161 million and
    you have only allocated about $6.4 million. Yet, I understand
    we are experiencing some cost overruns in some of my State. You
    have shifted those costs to the water users, the farmers and
    ranchers in those areas, and I am concerned about that.

                     yellowstone river flooding conditions

        This past weekend I was up in Yellowstone Park, and we were
    up in the mountains. We have got a lot of snow this year. Now,
    that only means one thing: It has all got to come down and it
    is very fluid. Of course, the lower Yellowstone River is my
    concern again. We went through this process before at
    Yellowtail Dam, and I would just like to hear your comments on
    steps that should be taken now on the inventory. I know it
    could all come at once or it could come all summer. We cannot
    control the weather end of this thing, but I am just wondering,
    are there any plans being made right now to deal with the
    snowpack?
        It is a wonderful problem. New Mexico is in a drought. I
    wish I could ship some water to Senator Domenici.
        Mr. Martinez. Mr. Chairman, Senator, we have starkly varied
    conditions across the West. On the Pecos River in New Mexico,
    we have 18 percent of normal water flow projected for this
    year, while in the Pacific Northwest and other places we have
    over 250 percent.
        However, our flood operations are in full gear in those
    areas where we expect a runoff to make sure that we do
    everything to minimize a flooding potential. So, we have
    learned from past experiences and hopefully we will do a better
    job as we move along.
        Senator Burns. I am really concerned about this, because I
    will tell you we went through that flood a few years ago, and
    it was just the result of water management out of Yellowtail
    Dam. At the high time when it was coming down to Yellowstone,
    you made a big release out of Yellowtail on the Big Horn River.
    That flows into the Yellowstone River. I will tell you right
    now if it looks like that we have not really managed that water
    and we have similar flooding this year, there is going to be a
    bounty on you because it will be a sorry situation.

                          reclamation grazing permits

        Now, another question. I am getting a little confused about
    the Bureau's main purpose here. I see you are dealing with
    grazing permits now?
        Mr. Martinez. Well, we have lands that were withdrawn from
    Bureau of Reclamation projects across the West. On some of
    those lands, we do have grazing leases and manage our lands.
        Senator Burns. Does that not traditionally fall into BLM? I
    do not think you folks are range managers.
        Mr. Martinez. And I would agree with you.
        Senator Burns. Well, then do something about it. Give it
    back to the BLM or something.
        Mr. Martinez. I will look into that.
        Senator Burns. Yes, just do that.

                               glendive, montana

        Mr. Commissioner, we have some projects in Montana that are
    paid off and they have requested transfer. One of them in
    particular is the Intake Division Dam near Glendive, Montana.
    What is the problem there? How come we are not making that
    transfer?
        Mr. Martinez. Well, I am not aware of that particular
    request. Basically, what we do is when a project sponsor
    requests transfer, we engage and hopefully move toward
    completion. But let me tell you, in the last 3 years we have
    not had too much success, and hopefully we will have some
    success with some of these issues.
        Senator Burns. What is the main problem?
        Mr. Martinez. Well, among the problems is occasional
    opposition from even the local folks as to whether or not a
    project should be transferred valuation, and NEPA studies that
    have to be completed. It is just not as easy as saying we can
    transfer overnight. Then, of course, we have to bring each
    transfer before Congress because ultimately you have to make
    that decision. Those are Federal properties and Congress has to
    act on them, but we will move forward, engage the project
    sponsors, and see if we can bring that proposal before
    Congress.
        Senator Burns. You do not own the land. You just own the
    water. Now they want to take control of their own project. It
    is already paid out, so why are we not making the transfer?
        Mr. Martinez. Because by Federal law, the Federal
    Government owns those facilities even though they have paid out
    their percentage of the costs. So, in order for those transfers
    to occur, it has to be through an act of Congress.
        Senator Burns. Well, Congress will act.
        Do you have to do a NEPA before you make that transfer?
        Mr. Martinez. Yes.
        Senator Burns. Well, that is all I have. Thank you very
    much.
        But now, on the CALFED expenditures, I am clearly concerned
    about the obligation of $161 million and expenditure of just $6
    million.
        Senator Domenici. $6 million.
        Senator Burns. Expended $6 million. Then we go around and
    we look for little projects to do, and run into cost over-runs
    and won't transfer ownership of these projects when they should
    be transferred. You can understand my concern.
        I would like to remind you, now is the time to start
    planning for that lower yellowstone, though, because we got a
    lot of water.
        Thank you, Mr. Chairman.
        Senator Domenici. Thank you very much.
        Did you have any further comments, either of you? Yes,
    Madam Secretary.

                      status of spending on calfed program

        Ms. Beneke. I am hoping that the record is clear on the
    exact status of the spending on the Bay-Delta ecosystem
    program. We have $149 million of the $160 million allocated to
    specific projects or programs. We have $73 million obligated of
    the $85 million fiscal year 1998 funds. I would also like to
    note that we are a year and a half into this program. We have
    the mechanism in place to go ahead and expend these funds, and
    I am anticipating that our obligation rate and expenditure rate
    will pick up considerably for the next several months.
        Senator Burns. Would you supply the committee with a list
    of those projects?
        Ms. Beneke. Yes. I would be glad to do that.
        Senator Domenici. I think we have them, but let us check
    and see. I think we do.
        [The information follows:]

                                      BAY-DELTA ECOSYSTEM RESTORATION APPROPRIATION
    ----------------------------------------------------------------------------------------------------------------
                                                                                          Funding         Funding
                                                                                       Allocated in    Allocated in
               Funding Category/Projects                         Agency                 fiscal year     fiscal year
                                                                                           1998            1999
    ----------------------------------------------------------------------------------------------------------------
    Woodbridge Fish Screen........................  USBR............................           1,575
    Richter Brothers Screen.......................  USBR............................              49  ..............
    Boeger Brothers Screen........................  USBR............................              15  ..............
    Small Diversion Fish Screens Program \1\......  NRCS............................             900  ..............
          Fish Screen Improvements................  ................................          $2,539  ..............
    Anderson-Cottonwood Irrigation District (ACID)  USBR............................             325  ..............
     Screen.
    Fish Passage Program..........................  USBR............................           8,000  ..............
        ACID Fish Passage & Fish Screen             ................................             860  ..............
         Improvement Project, Phase II.
        Anadromous Fish Passage at Clough Dam on    ................................           1,280  ..............
         Mill Creek.
        Fish Passage Improvement Project at the     ................................             341  ..............
         Red Bluff Diversion Dam.
        Steelhead & Chinook Salmon Fish Passage     ................................             178  ..............
         Barrier Remediation at Guadalupe River...
        Cosumnes River Salmonid Barrier Program...  ................................             188  ..............
        Boeger Family Farms Fish Screen, Phase III  ................................             140  ..............
         (Construction).
        Hastings Tract Fish Screen, Phase II        ................................             271  ..............
         (Construction).
        City of Sacramento Fish Screen Replacement  ................................             655  ..............
         Project, Phase II.
        American Basin Fish Screen & Habitat        ................................             200  ..............
         Improvement Project.
        Stanislaus River Channel Restoration......  ................................           1,038  ..............
        Tuolumne River Setback Levees.............  ................................             655  ..............
        Battle Creek..............................  ................................             395  ..............
        Fish Passage Program Remaining Balance \1\  ................................           1,799  ..............
    ACID Fish Passage Improvement Project, Phase    USBR............................  ..............           5,253
     III.
    Battle Creek Salmon and Steelhead Restoration   USBR............................  ..............          28,000
     Project.
    Lower Butte Creek Project, Phase II...........  USBR............................  ..............             775
          Fish Passage Improvements...............  ................................           8,325          34,028
    San Joaquin Floodplain Acquisition and          USFWS...........................          10,647
     Riparian Restoration.
    Bear Creek Floodplain Restoration               USFWS...........................             334  ..............
     Demonstration Project.
    Napa River Wetlands Acquisition...............  USBR............................           1,000  ..............
    Cache Slough Habitat Enhancement..............  USBR............................              85  ..............
    Regional Wetlands Goals Project...............  USEPA...........................              76  ..............
    Cosumnes River Floodplain Acquisition.........  USBR............................           3,500  ..............
    Prospect Island...............................  USCOE...........................           2,000  ..............
    McCormack-Williamson Tract Acquisition........  USFWS...........................  ..............           5,250
    McCormack-Williamson Tract's Wildlife-friendly  USFWS...........................  ..............             860
     Levee Management Project.....................
    Habitat Restoration/Flood Control Bypasses      USCOE...........................           1,200  ..............
     Program \1\.
    Floodplain Restoration/Habitat Restoration on   USFWS...........................          14,000           2,700
     Existing Conservation Lands Program..........
        Butte Creek Acquisition...................  ................................             125  ..............
        Lower Mill Creek Riparian Restoration.....  ................................              30  ..............
        Grayson River Ranch Perpetual Easement and  ................................             732  ..............
         Restoration.
        Hill Slough West Habitat Demonstration      ................................             200  ..............
         Project.
        Rhode Island Floodplain Management and      ................................              25  ..............
         Habitat Restoration.
        Nelson Slough Wildlife Area Restoration     ................................             256  ..............
         Demonstration Project.
        Merced River Salmon Habitat Enhancement,    ................................           2,433  ..............
         Phase III.
        Stone Lakes National Wildlife Refuge Land   ................................           1,900  ..............
         Acquisitions.
        Petaluma Marsh Expansion Project--Marin     ................................             352  ..............
         County.
        South Napa River Wetlands Acquisition and   ................................             431  ..............
         Restoration.
        Lower Clear Creek Floodway Restoration....  ................................           3,560  ..............
        Fern-Headreach Tidal Perennial Aquatic and  ................................             425  ..............
         Shaded River Aquatic Conservation........
        Benicia Waterfront Marsh Restoration......  ................................              59  ..............
        Floodplain Acquisition, Management, and     ................................           1,000  ..............
         Monitoring on the Sacramento River.......
        Cosumnes River Acquisition Restoration,     ................................             750  ..............
         Planning and Demonstration...............
        Deer and Mill Creeks Acquisition and        ................................           1,000  ..............
         Enhancement.
        Lower San Joaquin River Floodplain          ................................             722             396
         Protection and Restoration Project.......
        Biological Restoration and Monitoring in    ................................  ..............             773
         the Suisun Marsh/North San Francisco Bay
         Ecological Zone..........................
        South Napa River Tidal Slough and           ................................  ..............           1,455
         Floodplain Restoration Project.
        Butte Creek Riparian Restoration            ................................  ..............              76
         Demonstration.
          Habitat Restoration In Floodplains and    ................................          32,842           8,810
           Marshes.
    Liberty Island Acquisition....................  USFWS...........................           8,577  ..............
    Sedimentation Movement, and Availability and    USGS............................           1,047  ..............
     Monitoring in the Delta.
    Tuolumne River Mining Reach Restoration         USFWS...........................  ..............           3,332
     Project No. 2--MJ Ruddy Segment..............
    Merced River Salmon Habitat Enhancement, Phase  USBR............................  ..............           1,633
     I: Robinson/Gallo Project, Ratzlaff Reach
     Site.........................................
    Tuolumne River Special Run Pool (SRP) 10        USBR............................  ..............             165
     Restoration.
    Preliminary Design and Engineering--Lower       USBR............................  ..............             130
     Western Stone Restoration Site, Merced River.
          River Channel Changes...................  ................................           9,624           5,260
    Environmental Water Acquisition Program \2\...  USBR............................          14,500  ..............
                                                   -----------------------------------------------------------------
          Improved Instream Flows.................  ................................          14,500  ..............
    Assessment of Organic Matter in the Habitat     USGS............................           1,400  ..............
     and Its Relationship to the Food Chain.......
    Evaluation of Selenium Sources, Levels, and     USGS............................           1,589  ..............
     Consequences in the  Delta...................
    Bacterial Treatment of Selenium in the Panoche  USBR............................           1,149  ..............
     Drainage.
    Sand and Salt Creek Watershed Project.........  USBR............................             599  ..............
    Integrated Pest Management in Suisun Bay        USBR............................             266  ..............
     Program.
    Assessment of Ecological and Human Health       USBR............................  ..............           3,800
     Impacts of Mercury in the Bay-Delta Watershed
          Water Quality and Temperature             ................................           5,003           3,800
           Improvement.
    Exotic Species Control Program................  USFWS...........................           1,250  ..............
                                                   -----------------------------------------------------------------
          Introduced and Undesirable Species        ................................           1,250  ..............
           Control.
    Evaluation of Tagging Data....................  USBR............................             625  ..............
          Improved Fish Management and Hatchery     ................................             625  ..............
           Operations.
    Watershed Improvement/Sediment Stabilization    USFS............................             371  ..............
     on Deer, Mill and Antelope Creeks............
    Watershed Restoration Planning Program........  USEPA...........................           1,550           1,310
        Petaluma River Watershed Restoration......  ................................             220  ..............
        Cottonwood Creek Watershed Group Formation  ................................             161  ..............
        Battle Creek Watershed Stewardship........  ................................             145  ..............
        Local Watershed Stewardship Steelhead       ................................              48  ..............
         Trout Plan.
        Cold Water Fisheries and Water Quality      ................................             200  ..............
         Element.
        Merced River Corridor Restoration Plan....  ................................             300  ..............
        South Yuba River Coordinated Watershed      ................................             264  ..............
         Management Plan.
        Watershed Restoration Strategy for the      ................................             212              32
         Yolo Bypass.
        Proposal to Develop Local Watershed         ................................  ..............             159
         Stewardship Plan for the Lower Mokelumne
         River....................................
        Union School Slough Watershed Improvement.  ................................  ..............             636
        American River Integrated Watershed         ................................  ..............             221
         Stewardship Strategy.
        Sulphur Creek Coordinated Resource          ................................  ..............              24
         Management Planning Group.
        Lower Putah Creek Watershed Stewardship...  ................................  ..............             100
        Alhambra Creek Watershed CRMP.............  ................................  ..............             138
    Butte Creek Watershed Road Survey.............  USFWS...........................             294  ..............
    Inventory of Forest Road Systems--Cat Creek     USFS............................              38  ..............
     Watershed.
    Floodplain Easement--Lower Tuolumne and San     NRCS............................  ..............           1,545
     Joaquin Rivers.
          Watershed Management....................  ................................           2,253           2,855
              EPA Contribution....................  ................................  ..............             910
              Bay-Delta Account...................  ................................           2,253           1,945
    Integrated Phasing Strategy (CALFED Program     USBR............................           1,647           3,200
     Staff).
    Coordinated Permitting (CALFED Program Staff).  USBR............................             282  ..............
    Development of a Watershed Management Program   USBR............................             184  ..............
     (CALFED Program Staff).......................
    Comprehensive and Coordinated Monitoring        USBR............................           1,157  ..............
     Assessment and Research Program (CCMARP).....
    Bay-Delta Education Program...................  USBR............................             300             120
        San Joaquin Valley's ``Salmonids in the     ................................               3  ..............
         Classroom'' Program Enhancement..........
        Traveling Film Festival/Heron Booth/Video   ................................              54  ..............
         Archive.
        Environmental Agriculture Conferences and   ................................              28  ..............
         Field Tours.
        Sacramento River Headwaters to the Ocean,   ................................              50  ..............
         Public Information and Education.........
        Discover the Flyway.......................  ................................              49  ..............
        The Butte Creek Watershed Educational       ................................              33  ..............
         Workshops and Field Tours Series.........
        Bay-Delta Environmental Restoration         ................................              40  ..............
         Education Program.
        The Virtual Science Center and Hands-on     ................................              42  ..............
         Learning Programs.
        Water Hyacinth Education Program..........  ................................               1              10
        Water Challenge 2010......................  ................................  ..............              65
        Tuolumne River Natural Resources Program..  ................................  ..............              45
    Special Support Programs (CALFED Program        USBR............................  ..............           1,751
     Staff).
    Prospect Island Monitoring Project............  USCOE...........................  ..............             915
          Monitoring, Permit Coordination, and      ................................           3,570           5,986
           Other Special Support.
    Restoration Reserve...........................  USBR............................           3,319           3,750
    Technical Review and Quality Control Program..  USBR............................             850             750
    Administrative Support Program................  USBR............................             850             750
          Miscellaneous Expenses/Administration...  ................................           4,469           5,000
    Pending April 16, 1999 due date of the Public   ................................  ..............          10,171
     Solicitation Process.
    Less EPA Contribution (Watershed Management     ................................  ..............            -910
     Category).
          GRAND TOTAL ALLOCATED (Bay-Delta          ................................          85,000          75,000
           Account).
    ----------------------------------------------------------------------------------------------------------------
    \1\ Program is included in the Public Solicitation Process issued on February 16, 1999 with a project submittal
      due date of April 16, 1999. Project selection is expected to be complete by June 30, 1999.
    \2\ CALFED is currently working the Stakeholder community to develop this program.

        Ms. Beneke. It is a very important program in California.
        Senator Domenici. When I raised the issue, I just wonder if
    we started too fast. That is all I am wondering about.
        Ms. Beneke. Sir, I would also say that Congress authorized
    $143.3 million in annual appropriations for this program. We
    have come in with a request this year of $75 million, which we
    think is well tailored to what we can expend and what the need
    is. We are going to be sending up a request to extend the
    authorization for this program, and we will be working with the
    authorizing committees on that as well.

                         new mexico drought conditions

        Senator Domenici. I would like to make one last observation
    directed to the Department and, in particular, the
    Commissioner. I am pleased that I have six Senators here.
        My State is on the verge of a drought. The Commissioner has
    just expressed a concern about one river in our State. It is
    not as drastic, but every river is having enormous problems in
    terms of the source of water that normally flows down the
    rivers.
        We have a budding problem with reference to the endangered
    species law that is very, very serious. It has to do with a
    minnow on our biggest river system. It has been declared an
    endangered species, and it is entirely possible that we cannot
    maintain the flow in the river for the minnow, which is a
    latecomer to the water needs of that river basin, having just
    been adjudicated, whereas we have had all kinds of other users
    lined up who are entitled to water, including large cities like
    Albuquerque who bought much of the water that is coming down
    the river.
        We may very well be asked here in Congress to do something
    to alleviate this situation unless the managers of the river
    system can accommodate the traditional users who already have
    claims, the cities who own the water, and a minnow that has
    just recently, as I indicated, made claim to our waters.
        We have a similar one in the second largest water system,
    another minnow, the same claim, in a drought era in a desert
    State. I just leave that with you.
        Senator Burns. Do you want some grizzly bears?

                         Additional committee questions

        Senator Domenici. Well, what we need is we need some common
    sense, but that is the problem.
        Thank you both very, very much.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                    Questions Submitted by Senator Domenici

                  san juan river-gallup, mount taylor pipeline
        The Committee has been funding the San Juan-Gallup, Mount Taylor
    Pipeline study effort for the past two years. Last year, the Bureau of
    Reclamation entered into a Memorandum of Agreement to undertake a
    feasibility study of a water supply pipeline from Mount Taylor mine for
    additional water supplies in the area. The Committee understood that
    the Bureau had sufficient funding available in fiscal year 1999 to
    complete the study, but provided additional funding to insure there
    were no delays or funding constraints.
        Question. What is the status of this study which will confirm the
    quantity and quality of water that might be available from the Mount
    Taylor mine?
        Answer. We have completed an appraisal study of the requirements
    for treatment and delivery of water through a pipeline from Mt. Taylor
    to Gallup, Acoma Pueblo, and Laguna Pueblo. A separate preliminary
    study has been done by John Shomaker & Associates for the City of
    Gallup on the quantity of water available. Shomaker's preliminary
    estimate is that 4,000 acre feet of water could be produced from the
    Mt. Taylor Mine for about 40 years. We estimate the pipeline and
    treatment plant would cost $35-$40 million to build and a preliminary
    estimate of $2-$2.5 million annually for operation and maintenance. No
    special environmental or cultural resource issues have been identified.
    However, disposal of selenium at the water treatment plant is a concern
    and a high cost for documentation and mitigation of archaeological
    sites should be anticipated due to high density of known sites in the
    area.
        Question. Will the study be completed in fiscal year 1999 as
    planned? If not, why? Has the Bureau established a firm schedule to
    complete the determination of quantity and quality?
        Answer. No, at this point Reclamation has not initiated feasibility
    studies. None of the local sponsors are able to provide cost-sharing
    contributions to take the studies to the feasibility stage. Reclamation
    has proposed entering into a Memorandum of Agreement with the city of
    Gallup, and the Acoma and Laguna Pueblos, under which Reclamation would
    contract with the Pueblos under the authority of the Indian Self-
    Determination Act of Public Law 93-638 to accomplish some of the needed
    studies. These contracts would not require cost sharing. We have
    proposed two major studies to be completed under these contracts. The
    first are detailed hydrologic studies including groundwater modeling to
    provide a firmer estimate of the quantity of water available and to
    identify and quantify potential impacts on other parts of the
    hydrologic system such as springs, streams, and other aquifers. The
    second is the development of a legal framework for cooperation of the
    sponsors to plan, implement, and operate the project. Substantial
    questions related to water rights and allocation of project water need
    to be addressed before the project could be built. To date, the
    proposed agreement has not been accepted and signed by all the
    sponsors.
                   san juan gallup-navajo water supply study
        The San Juan Gallup-Navajo Water Supply feasibility study has been
    on-going for several years. The Committee provided $150,000 for the
    current year for the Bureau of Reclamation to complete the feasibility
    study and initiate NEPA compliance activities.
        Question. What is the status of this study?
        Answer. Reclamation and the study partners will complete a planning
    status report and environmental analysis during fiscal year 1999. The
    report will present the preferred plan and alternatives considered by
    the study partners and identify significant environmental issues that
    would be addressed during the National Environmental Policy Act
    process. Consultation under Section 7 of the Endangered Species Act
    will be initiated with respect to the endangered fish in the San Juan
    River by the Bureau of Indian Affairs during fiscal year 1999.
        Question. How much funding is included in the fiscal year 2000
    budget request to continue the study effort?
        Answer. No funding has been requested for fiscal year 2000.
        Question. Is this level of funding sufficient to keep the study on
    schedule?
        Answer. No. Additional funding of $300,000 would be needed in
    fiscal year 2000 to keep this project moving forward. These funds would
    allow the NEPA process to move forward and allow data to be collected
    to refine the project plan. The additional capability shown was not
    included in the President's budget. The Department does not support the
    addition of funds for any project that would result in the reduction of
    funding for programs or projects included in the budget request.
        Question. Has the Bureau established a firm schedule to complete
    the San Juan Gallup-Navajo Water Supply study effort?
        Answer. No. Due to the uncertainty of funding a firm schedule has
    not been completed. The planning status report and environmental
    assessment will be completed during fiscal year 1999. If funding is
    available, necessary data could be collected and a Feasibility Report/
    Environmental Statement could be completed by the end of 2001. In order
    for the project to move to implementation, additional construction
    authorization and funding would also be required.
                      taos indian water rights settlement
        The Committee provided $2 million in the current fiscal year for
    the Bureau of Reclamation to initiate and complete a confirmatory well
    drilling program of the deep aquifer which was a critical element of
    the Taos Indian Water Rights Settlement Agreement.
        Question. What is the current status of your efforts to undertake
    this important work?
        Answer. An environmental assessment, which typically takes 3-5
    months, is in progress and is scheduled to be completed late in April
    of this year. Depending upon the results of the assessment, drilling
    could commence after the environmental assessment is done.
        Question. Will the proposed work be completed in fiscal year 1999
    as directed, if not, why? Is additional funding needed in fiscal year
    2000? If so, what is the Bureau's funding capability?
        Answer. No, the work cannot be completed in fiscal year 1999
    because of the size and depth of the seven wells. It will take about
    two months to complete each well even with some 24-hour per day
    drilling. Completion of the drilling is anticipated in late spring or
    summer of 2000.
        The current funding capability estimate for fiscal year 2000 is
    $700,000. This includes all required NEPA activities, contact
    administration, modeling reports, and consultant fees. This estimate is
    based on the assumption that the drilling has been completed, and a
    recommendation to proceed has been made.
        ute reservoir pipeline project, curry and roosevelt counties, nm
        The Conference Agreement for fiscal year 1999 included $200,000 for
    the Bureau of Reclamation to begin feasibility studies of the Curry and
    Roosevelt counties portion of the Ute Reservoir Pipeline project.
        Question. How does the Bureau of Reclamation plan to proceed with
    this work in fiscal year 1999?
        Answer. The Ute Water Commission is working on a plan of study for
    this work which will include feasibility planning and environmental
    compliance for the Curry and Roosevelt Counties phased portions of the
    Ute Pipeline project. Reclamation plans on modifying the existing
    Cooperative Agreement to include this work once we receive and agree on
    the scope of work.
        Question. How much funding is requested in your fiscal year 2000
    budget to continue this work?
        Answer. No funding was requested for this work in fiscal year 2000.
        Question. Now, $300,000 was provided in fiscal year 1998 for the
    Quay County portion of the project. What is the status of the Quay
    County studies?
        Answer. On June 24, 1998, Reclamation entered into a Cooperative
    Agreement with the Eastern Plains Council of Governments (COG). This
    obligated funds in the amount of $285,000 to the COG, which includes
    $15,000 to administer the contract. The additional $15,000 was set
    aside to pay Reclamation administrative costs.
        In September of 1998, a contract was entered into between the COG
    and Smith Engineering to prepare a Special Report (to be completed in
    June 1999) which would provide enough information for the local
    sponsors to solicit financing for final design and construction either
    from private or public entities. This effort differs from past efforts
    as it provided for project phasing, which allows the Quay County
    portion to be built first, and subsequent phasing would provide for
    final project completion.
                    upper rio grande basin water management
        The Upper Rio Grande Basin water operation model has been under
    development for several years with funding that has been appropriated
    by this Committee.
        Question. Am I correct that the development of the model is about
    to be completed? Is there any additional model development which will
    not be completed in fiscal year 1999 for which funding will be required
    in fiscal year 2000? If so, does the Bureau have sufficient funding
    requested in fiscal year 2000 to carry out any additional development
    work that may be needed? How much funding over and above the budget
    request is needed to complete the development work?
        Answer. The first fully linked upper-basin model, operating from
    Colorado to Fort Quitman, Texas is scheduled to be completed in fiscal
    year 2000. However, this ``backbone water operations model'' will lack
    necessary refinements required to satisfy planning and NEPA
    applications in some reaches of the river. These necessary refinements
    are expected to continue into fiscal year 2004 as various water
    management and operational issues surface in the basin requiring the
    detail of a planning model. Several water issues in the basin are
    currently showing a need for accelerated application of the planning
    model. Acceleration of the model refinement would require enhanced
    funding from various partnership sources. Currently, the model is being
    developed using funding from several sources and partners. Reclamation
    has requested $345,000 for model development in fiscal year 2000 but
    could apply an additional $250,000 toward accelerated model refinement.
    The additional capability shown was not included in the President's
    budget. The Department does not support the addition of funds for any
    project that would result in the reduction of funding for programs or
    projects included in the budget request.
        Question. How do you envision using this operational model as a
    management tool?
        Answer. The model can be thought of in terms of three modular
    components: First, a real-time hydrologic daily decision support system
    linked to a real time monitoring network. Second, a water accounting
    and water operations model used for analysis and documentation of daily
    flood control and project water delivery operations; and, third, a
    basin-wide hydrological planning model used for evaluating impacts of
    long range water management and water development scenarios. There is
    already a well defined need for all three model components.
        Question. Now, funding is included in the budget to begin work with
    the Regional Water Planning Assembly to undertake ``grass-roots water
    planning efforts for the Middle Rio Grande Valley''. Can you explain
    what the Bureau has in mind, what the total cost of the effort is
    expected to be, and how long you expect to fund this effort? What is
    the make-up to the Regional Water Planning Assembly?
        Answer. In fiscal year 2000, $50,000 is requested for coordination
    with the Regional Water Planning Assembly and minor technical support.
    An additional $78,000 is estimated to be needed for work through fiscal
    year 2002. The Regional Planning Assembly is a grass roots organization
    which came into existence at the request of the New Mexico Governor and
    State Engineer to address basin-wide water resource issues. The mission
    of this group is to formulate a regional water plan funded by the New
    Mexico Interstate Stream Commission. The group includes representatives
    from every water interest sector in the Middle Rio Grande Valley. This
    includes farming, municipal, environmental, rural organizations as well
    as water management agencies at the local, state, and federal level.
            reclamation recreation management program--title xxviii
        Congress provided $2 million for the current fiscal year for the
    Bureau of Reclamation to more fully participate in a cost-shared
    program with the State of New Mexico for recreation facility
    improvements under Title XXVIII of the Reclamation Projects
    Authorization and Adjustments Act. The funding was provided because the
    Committee understood that the State of New Mexico had been financing
    recreation improvements unilaterally and that an imbalance existed in
    the allocation of funding through this program.
        Question. Do you expect any problems in carrying out this program
    as authorized and intended by the Committee? Specifically, how is the
    Bureau using the $2 million provided for improvements at recreation
    facilities in New Mexico?
        Answer. We will have no problem in carrying out this program. Most
    of the funding will be used to rehabilitate recreation facilities at
    Elephant Butte and Navajo State Parks. Funds will also be used for
    facilities at Caballo, Heron, El Vado, Sumner, Percha and Leasburg
    State Parks.
                                animas-la plata
        Congress has appropriated $3 million or more annually for the past
    several years for the Bureau of Reclamation to continue data
    collection, analysis and other activities related to the Animas-La
    Plata project. The fiscal year 2000 budget again includes $3 million
    for similar activities.
        Question. What has been the total level of funding appropriated for
    this project over the past 5 years, and how much has actually been
    spent on the project?
        Answer. The total amount appropriated for Animas-La Plata for the
    period fiscal year 1995 through fiscal year 1999 was $34.8 million.
    Reclamation applied a total of $4.8 million of underfinancing to this
    project during the period. Therefore, the net allotments for the past 5
    years totaled $30 million. The total amount spent on the Project from
    fiscal year 1995 through February 1999 was about $20.2 million.
        Question. How much funding is available for expenditure in fiscal
    year 1999 from prior year balances? How much of the total funding
    available does the Bureau expect to spend in fiscal year 1999?
        Answer. At the beginning of fiscal year 1999, $9.5 million was
    available to expend from prior year balances. If the fiscal year 1999
    allotment of $0.5 million is added, then $10.0 million is available to
    expend in fiscal year 1999. The initial fiscal year 1999 estimate for
    expenditures was approximately $3.0 million. With the anticipated new
    environmental evaluations discussed below, additional expenditures are
    expected. The magnitude of those expenditures is currently being
    evaluated.
        Question. Now the budget justification seems to indicate that the
    Department has selected a Proposal for Animas-La Plata. The
    justification uses terms such as ``the Department of the Interior's
    Proposal'', the ``Administration Proposal'', and ``refining the
    Proposal''. Please explain what is meant by ``Proposal''. Has the
    Department of the Interior selected a ``project'' alternative as
    directed by Congress? Specifically, how will the funding requested for
    fiscal year 2000 be used?
        Answer. On August 11, 1998, the Secretary of the Interior presented
    an Administration Proposal to build a down-sized version of Animas-La
    Plata to implement the Colorado Ute water rights settlement, which
    would also include a nonstructural element as part of the settlement
    implementation. Then on January 4, 1999, a Notice of Intent (NOI) was
    published in the Federal Register announcing the intent to prepare a
    Draft Supplemental Environmental Impact Statement for the Animas-La
    Plata Project pursuant to the National Environmental Policy Act (NEPA)
    of 1969, as amended. The Draft Statement would evaluate the
    environmental impacts of the Administration Proposal and several other
    alternatives. Pending public input, Reclamation intends that the
    Administration Proposal and each of the alternatives described in the
    NOI undergo an environmental impact analysis beginning with a threshold
    assessment of the alternative's capability to accomplish the project's
    purpose fiscal year 2000 funding would be used to conduct a major
    portion of the NEPA process identified in the NOI. Current plans are to
    use contracts under the Indian Self-Determination Act authority of
    Public Law 93-638 with both Colorado Ute Indian Tribes to conduct this
    work.
        Question. Last year, you testified that the analysis of
    alternatives would be completed in 3-6 months. Has the analysis of
    alternatives been completed as you testified? If not, why?
        Answer. Reclamation conducted an appraisal-level analysis on the
    two alternatives resulting from the Romer/Schoettler Process. Prior to
    its finalization, the Secretary of the Interior announced an
    Administration Proposal incorporating portions of those two
    alternatives. All information and data developed as part of the Romer/
    Schoettler Process, as well as previously completed environmental
    studies, are being utilized and incorporated into the present Draft
    Supplemental EIS effort.
        Question. Why should the Congress appropriate any further funding
    for this project for fiscal year 2000?
        Answer. The Administration is committed to implementing a water
    rights settlement for the Colorado Ute Tribes. We anticipate increased
    costs to accelerate NEPA compliance work and will seek authority to
    immediately initiate activities to implement the selected alternatives.
                    salton sea, california research project
        For the past several years, funding has been provided for the
    Salton Sea research project in California to investigate increasing
    salinity, other water quality issues, and rising surface levels which
    are flooding developed areas and wildlife habitat. The Bureau of
    Reclamation, and other Federal and State agencies are engaged in an
    effort to identify and evaluate possibilities for improving the
    conditions of the sea, a program of additional planning, research, and
    environmental impact analysis.
        Question. First, tell the Committee why the Bureau of Reclamation
    is involved in this effort?
        Answer. The Salton Sea as we know it today was created in 1905-07,
    when the flooding Colorado River broke through a temporary diversion
    works and flowed into the Salton Sink for nearly 15 months before it
    was diverted back to the river channel. Soon after, the Sea began to
    decrease as the flow of new water was discontinued prior to the
    creation of irrigated agriculture. In 1942, the All-American Canal
    began carrying Colorado River water to the Imperial and Coachella
    Valleys which flank the Salton Sea and thus the Sea began to receive an
    annual inflow of water created from the agricultural drainage.
    Reclamation was the Federal partner in the development of this
    diversion system.
        The Bureau of Reclamation studies directed towards managing the
    salinity of the Salton Sea date back to the 1960's, when Reclamation
    and the California Department of Water Resources performed a joint
    appraisal evaluation of possible alternatives. Title XI of Public Law
    102-575, the Salton Sea Research Project Act, directed the Secretary of
    the Interior, acting through Reclamation, to conduct a research
    project. Most recently, Congress in 1998 passed the Salton Sea
    Reclamation Project Act, Public Law 105-372, which directed the
    Secretary of the Interior, acting through Reclamation, to conduct an
    Environmental Impact Statement/California Environmental Impact Report
    feasibility study to reclaim the Sea, and specifically named the Bureau
    of Reclamation as lead agency on these efforts.
        Question. Setting aside the action of the Secretary of the Interior
    designating the Bureau of Reclamation as the lead agency in the
    Department, is there a direct connection to your traditional missions
    and responsibilities?
        Answer. There is a direct connection to Reclamation's traditional
    mission and responsibilities in this project. The two irrigation
    districts that contribute agricultural drainage to the Salton Sea are
    both Reclamation projects built through a partnership with the Federal
    government. As with most of our projects, if the operation of the
    project adversely affects the local environment then Reclamation can be
    involved in developing solutions to the problems.
        Question. How much funding has been provided for this effort across
    all Federal government agencies in fiscal year 1998 and fiscal year
    1999, and how much is requested for fiscal year 2000? How much funding
    are State and other non-Federal agencies providing for fiscal year 1999
    and 2000?
        Answer. The following table presents the Federal funding being used
    to perform the various activities associated with the Salton Sea.
    Bureau of Reclamation
        Fiscal year 1998--$2,000,000 (Includes $400,000 enacted and
    $1,600,000 fund transfer and reprogramming).
        Fiscal year 1999--$400,000 (Enacted).
        Fiscal year 2000--$1,000,000 (Requested).
    U.S. Environmental Protection Agency
        Fiscal year 1998--$5,875,000 (Enacted).
        Fiscal year 1999--$13,400,000 (Enacted).
        Fiscal year 2000--(None Requested).
    U.S. Fish and Wildlife Service
        Fiscal year 1998--$1,000,000 (Enacted).
        Fiscal year 1999--$1,000,000 (Enacted).
        Fiscal year 2000--$1,000,000 (Requested).
    U.S. Geological Survey
        Provides limited scientific expertise and personnel support.
        The State and other local non-Federal agencies have made or will
    make available a total of $3,784,100 for work in fiscal year 1999 and
    fiscal year 2000.
        Question. What is the total estimated cost of the effort to
    complete the feasibility design, and the technical and biological
    impact analysis work necessary for the preparation of feasibility
    report and environmental compliance documents?
        Answer. The current estimated cost of the feasibility study is
    $4.85 million. Reclamation is providing 50 percent of the total costs
    of the study which is being matched by a non-Federal cost sharing
    partner. The non-Federal cost sharing partner is the Salton Sea
    Authority, a Joint Power Authority established under the laws of the
    State of California.
        Question. Has a firm schedule, which establishes critical
    milestones, been established for this work? If so, could you provide it
    for the record?
        Answer. The Department of the Interior and Reclamation understand
    that January 1, 2000, is a firm date for a report to Congress. The
    following schedule is being followed to prepare the report and
    documents for this project.
        November 12, 1998--Salton Sea Alternatives Final Pre-appraisal
    Report--Engineering information on Salinity and Water Surface
    Elevation.
        February 15, 1999--Scoping Report on Public Meetings Held in July
    and October 1998.
        March 15, 1999--Draft Report, Screening Analysis of Initial
    Restoration Alternatives.
        April 30, 1999--Draft Appraisal Report on Proposed Alternatives.
        May-June 1999--Initial Reports from Baseline Science work being
    performed with submittal to the Science Subcommittee, Salton Sea
    Authority, and Reclamation.
        September 1, 1999--Draft Environmental Impact Statement/Planning
    Report, California Environmental Impact Report.
        January 1, 2000--Final Environmental Impact Statement/Planning
    Report, California Environmental Impact Report to Congress.
        Question. Is it realistic to believe that the Bureau of Reclamation
    can complete the feasibility report and associated National
    Environmental Protection Act documentation by January 1, 2000 when this
    work is only 9 percent complete?
        Answer. A report will be made available with proposed action
    alternatives for consideration by Congress by January 1, 2000.
    Reclamation will be able to provide an analysis of the alternatives for
    feasibility economics and costs on phase one, but not a complete
    feasibility-level engineering design for all phases. It is envisioned
    that the preferred project may be proposed using a phased approach to
    addressing the ecological issues of the Sea. The final Environmental
    Impact Statement/Planning Report will then include at least
    feasibility-level designs and cost estimates of phase one and
    appraisal-level designs and cost estimates for the other features.
        Question. The fiscal year 2000 justification material indicates
    that a portion of the $2 million budget request is to ``initiate
    specific design work on the preferred alternative course of action
    coming out of the feasibility report and supporting environmental
    compliance documents''. How much of the budget request is for specific
    design work on the preferred alternative, and why is this work being
    proposed prior to completion of the feasibility report and project
    authorization?
        Answer. Of the $2,000,000 total program in fiscal year 2000,
    $1,000,000 is non-Federal cost-sharing. When the fiscal year 2000
    Budget Justification was prepared, the funding proposed was based on an
    aggressive schedule that assumed that authorization by Congress would
    occur quickly and initiation of designs could occur shortly after
    Congressional decision within the same fiscal year. However, since then
    it is envisioned that the preferred project may be proposed using a
    phased approach to addressing the ecological issues of the Sea. The
    final Environmental Impact Statement/Planning Report will then include
    at least feasibility-level designs and cost estimates of phase one and
    appraisal-level designs and cost estimates for the other features. The
    funds originally identified in fiscal year 2000 to collect initial
    design data are now expected to be needed to complete feasibility
    designs for other phases of the preferred plan.
              california bay-delta ecosystem restoration (calfed)
        The budget request for fiscal year 2000 is $95 million, the last
    year appropriations are authorized. However, the Administration has
    proposed legislative language to extend the current spending
    authorization through 2003 in order that the full $430 million
    authorized currently will be funded. In addition to the funding
    provided under the CALFED program, funding is provided for similar
    restoration work in the Bay-Delta area through the Bureau of
    Reclamation's Central Valley Project Restoration Fund, the Bureau's
    Water and Related Resources funding account; and other Federal
    agencies.
        The programmatic environmental impact statement and a report
    describing the preferred alternative to address the issues related to
    the restoration program, including the possibility of new water supply
    options, is long overdue. Yet, the budget for fiscal year 2000 proposes
    expanding current activities by beginning the planning and
    implementation additional activities without reaching agreement on
    critical issues such as additional water supply, storage and
    conveyance, which are important to other water users principally those
    in the agricultural and development communities.
        Question. When Secretary Babbitt released the revised CALFED Phase
    II Report he indicated that additional issues remained to be worked
    out. What are these additional issues that need to be resolved? When
    will a final revised Phase II Report be issued, and a preferred
    alternative selected?
        Answer. The major issue referred to by the Secretary involved the
    water supply reliability element of the CALFED program, more
    specifically, the treatment of new storage facilities. CALFED agencies
    are continuing to refine the CALFED program, including the water
    management strategy and how to finance the program. CALFED has received
    the largest number of public comments on the use of water conservation
    as a tool to reduce demand versus the support for construction of new
    facilities, particularly surface storage. The schedule calls for CALFED
    to issue a supplemental draft environmental impact statement containing
    a preferred alternative and a Phase II Report in June 1999, and the
    final EIS/EIR in the spring of 2000.
        Question. Some have suggested that reoperation of existing non-
    Federal power facilities could provide significant additional water
    supplies needed to solve environmental and other water supply issues.
    What can you tell us about this idea? Is it a creditable suggestion,
    and would the Department of the Interior support such an approach?
        Answer. The reoperation of existing non-Federal power facilities
    could provide additional water for water users and the environment at
    high priority times and places. CALFED has proposed taking a
    comprehensive analysis of existing non-Federal hydropower projects in
    California as part of the proposed Integrated Storage Investigation.
    Interior, other Federal agencies, and the State generally support
    undertaking the Integrated Storage Investigation analysis and are
    currently refining the scope of work.
        Question. Under the CALFED agreement, the State of California is to
    share the costs of activities undertaken. Describe the cost-sharing
    arrangement with the State of California. If you consider Reclamation's
    appropriation of $160 million, what is the corresponding required level
    of State and non-Federal cost-sharing, and how much has actually been
    provided?
        Answer. The cost-share agreement between the Federal and State
    governments calls for equal sharing of ecosystem restoration costs over
    the period of ecosystem restoration activities. With the passage of
    Proposition 204, California voters provided $60 million in 1997 and
    another $390 million will become available when the State certifies the
    Final Programmatic Environmental Statement/EIS/EIR (similar to the
    Federal Record of Decision). Based on Proposition 204 and the $430
    million authorized by the Bay-Delta Environmental and Water Security
    Act, the Federal and State governments have made approximately equal
    commitments to Bay-Delta ecosystem restoration. As of September 30,
    1998 CALFED reports that the State had provided $55 million in
    Proposition 204 and other funds for approved Bay-Delta ecosystem
    restoration projects. Funding the $75 million ecosystem restoration
    request and extending the Bay-Delta Act is important to maintaining the
    Federal commitment.
        Question. Now the budget request for fiscal year 2000 proposed $20
    million to begin work on Phase II, non-ecosystem components. Is Phase
    II work specifically authorized? What is the justification for
    undertaking Phase II work in the absence of a final Programmatic
    Environmental Impact Statement and Preferred Alternative? Is there wide
    spread agreement and support for proceeding with this work? Is the
    State ready to cost-share in this work? What is the position of the new
    governor on proceeding with this work?
        Answer. The non-ecosystem work under Phase II that is contemplated
    for the $20 million is authorized by a wide range of existing
    authorities applicable to the Federal CALFED agencies. For example,
    those authorities include the Flood Control Act of 1950, Section 205;
    Reclamation Reform Act, Sections 210(1) and (c); Clean Water Act of
    1948, and additional authorities contained in Public Law 102-575,
    Central Valley Project Improvement Act (CVPIA).
        Undertaking work on non-ecosystem Phase II projects prior to
    completion of the programmatic environmental statement is appropriate
    because these are certain actions that will be needed for any
    alternative selected, and those actions can be taken consistent with
    the restrictions in the proposed fiscal year 2000 Bay-Delta
    appropriations language. CALFED anticipates completing its EIS/EIR
    during fiscal year 2000. We are requesting fiscal year 2000 funds to be
    ready to start these projects in a timely manner. Significant support
    exists for resolution of issues in the Bay-Delta. State agencies and
    California stakeholders endorse the activities that will be undertaken.
    Governor Gray Davis indicated strong support for the CALFED/Bay-Delta
    Program in his inaugural address. The draft EIS/EIR will describe the
    cost-share obligations of Federal and State government, as well as
    others, to finance implementation of the CALFED Bay-Delta Program.
                        managing competing water demands
        Because of concerns of the Senate authorizing committee, language
    was included in last years report directing the Bureau of Reclamation
    not to use funds to complete evaluations of current practices in each
    of the Area Offices to find ways to more effectively manage competing
    demands for water.
        Question. Have you complied with this directive? If not, explain
    why?
        Answer. Yes. Reclamation has complied with this directive.
    Reclamation also removed two performance goals referring to this
    activity from the fiscal year 1999 Annual Performance Plan.
                        operation and maintenance costs
        The Conference Report on the fiscal year 1998 Energy and Water
    Appropriations Bill asked the Bureau of Reclamation to prepare a report
    on the operation and maintenance costs of it's projects. The Committees
    requested the report because of expressed concerns related to how O&M
    costs were being allocated by project purpose, the declining level of
    operation and maintenance funding for traditional water supply and
    distribution related work, concerns that Reclamation's overhead
    expenses may be excessive, and the lack of opportunity of stakeholders
    to have input into the formulation of the Bureau's budget
    recommendations. The report was completed and provided to the Committee
    last September.
        Question. What has the Bureau done to afford stakeholders an
    opportunity to have input into the budget needs and priorities?
        Answer. Reclamation has been working for several years with many of
    our water and power customers in the formulation of the operation and
    maintenance (O&M) program, for our multipurpose projects. As an
    expansion of current efforts, and in response to language contained in
    the statement of the Managers accompanying the Conference Report for
    the fiscal year 1998 Energy and Water Appropriations Bill, the
    Commissioner issued a memorandum in September 1998 which directed the
    Regional Directors and Area Mangers to redouble their efforts to insure
    customers who are interested are given the opportunity to provide input
    into the formulation of project O&M programs. For Reclamation, this
    will continue to be an ongoing activity.
        Question. Can the Bureau benefit from this increased openness?
        Answer. Reclamation, our customers, and the general public have
    benefited and learned from the increased openness. We encourage
    customer feedback and believe the increased openness gives the
    customers the opportunity to realize how serious and committed
    Reclamation is to Project O&M.
        Question. Do you expect to learn new ways and approaches that could
    improve efficiencies and, thereby reduce O&M costs?
        Answer. Our efforts to benchmark the power program has been a
    worthwhile activity in that it has already identified areas where we
    compared very favorably with the hydroelectric industry. Reclamation
    will use benchmarking in the future to identify new ways and approaches
    to improve efficiency and ultimately reduce costs.
        Question. Now there is continuing concern that the Bureau of
    Reclamation is placing increasing emphasis and funding on non-
    traditional activities such as wetland creation and wildlife habitat
    enhancement, to name a few, at the expense of traditional operation and
    maintenance activities necessary to meet contractual water supply
    obligations. If you look just at the traditional O&M activities related
    to contractual water supply and distribution requirements, how does the
    fiscal year 2000 budget request of the Bureau compare to the fiscal
    year 1999 budget request?
        Answer. Reclamation undertakes environmental mitigation and
    enhancement activities only to the extent, and in the manner,
    authorized by Congress. These efforts are done in cooperation with the
    Fish and Wildlife Service, state game and fish agencies our water users
    and the public. Furthermore, nearly all of the environmental work which
    we undertake is necessitated by the regulatory requirements of such
    laws as the Endangered Species Act and the Clean Water Act, which
    requirements must be met if we are to continue to deliver the water and
    power benefits for which Reclamation projects have been authorized. We
    do not fund environmental work at the expense of project operation and
    maintenance. To the contrary, we fund such work so that we can continue
    to meet our contractual obligations to deliver water and power to our
    customers.
        Our environmental activities, including compliance with regulatory
    laws, are generally funded under different fund activities than are
    traditional project operation and maintenance activities. Reclamation's
    fiscal year 1999 and fiscal year 2000 budgets in the Facility Operation
    and Facility Maintenance and Rehabilitation, show increases in funding
    for both activities of $8.0 million and $7.5 million respectively. We
    believe that the increase reflects Reclamation's commitment to continue
    to meet its traditional contractual obligations for water and power
    supply in an effective and efficient manner.
        Question. The O&M Cost Report indicates that the Bureau of
    Reclamation is continuing efforts to control costs by reducing
    staffing. However, the Family Farm Alliance has provided information
    indicating that the San Luis and Delta-Mendota Water Authority was able
    to accomplish certain operation and maintenance work with 85 regular
    full time employees compared to 120 Reclamation employees.
        Answer. The Family Farm Alliance number of 120 is incorrect.
    According to Reclamation records, 72 federal employees performed
    subject operation and maintenance work.
        Question. Does Reclamation have procedures in place to periodically
    review and assess the manpower being used to accomplish O&M activities?
        Answer. Reclamation reviews and assesses staffing needs for O&M
    activities on a regular basis and we consider this activity an
    important one.
        Question. Have you reviewed situations like this with the objective
    of applying new approaches and methods instituted by non-Federal
    entities at other Reclamation projects?
        Answer. Reclamation always seeks ways to learn new approaches at
    one project and apply it to other projects Reclamation-wide as
    appropriate. We would also welcome the opportunity to benchmark our
    water program with others having similar facilities as we have in our
    power program.
        Question. Turning to indirect costs related to O&M projects, your
    Report indicates that 62 of 89 projects experienced overhead costs in
    excess of 20 percent in 1-2 years over 5 fiscal years of the analysis.
    How does this 20 percent level compare to other Federal agencies and
    non-Federal entities operation and maintenance overhead costs?
        Answer. As noted in the report at page 31, three of Reclamation's
    89 projects had overhead rates in excess of 20 percent in one or more
    of the five fiscal years in question based upon the definition of
    ``overhead costs'' used in the report. As was further noted on page 32,
    if Project General Expense costs were added to overhead costs, the
    total of which is referred to in the report as ``indirect costs,'' then
    62 projects would have had ``indirect cost rates'' in excess of 20
    percent in at least one of the five years in question.
        In our opinion, it is not possible to compare the overhead rates
    shown in our report to the ``overhead rates'' of other Federal agencies
    or non-Federal entities. This is due to the fact, as the report notes
    at page 5, that: (1) the term ``overhead'' is not used in budget
    documents submitted to Congress nor is it defined in the official
    Statement of Federal Financial Accounting Standards, and (2) the
    private sector does not use a uniform, commonly accepted approach as to
    what is included in overhead. As a result, practices vary widely across
    federal agencies as well as the private sector as to what costs are
    accounted for and labeled as overhead costs and as to how overhead
    rates are computed. Furthermore, what some federal agencies call
    ``overhead rates'' are actually just estimated service charges that may
    bear little direct relationship to actual costs incurred. Consequently,
    one cannot compare stated overhead rates between federal agencies, or
    between federal agencies and private firms, without first ensuring that
    each entity involved has classified exactly the same types of costs as
    overhead costs.
        Question. In your judgement, what is an acceptable level of
    indirect costs for a project?
        Answer. The level of administrative services and support functions,
    the costs of which are ``indirect costs,'' required to support the
    operation and maintenance of a project will vary from project to
    project because each project is authorized in a different manner.
    Depending on contractual arrangements we have with the individual
    authorized projects, these costs may vary, and do. Thus, what is
    acceptable for one project may not be acceptable at another.
    Reclamation does its best to be equitable in assessing indirect costs
    in a cost conscious, business-like manner.
        Question. What is Reclamation doing to identify those programs and
    activities that have indirect costs in excess of what would be
    expected?
        Answer. As addressed in the O&M Cost Report (see Chapter 6),
    Reclamation has taken a number of steps over the past few years to
    reduce the costs of its centralized administrative services and of its
    regional administrative services. For example, in the Management
    Services Office (MSO) in Denver, which provides the majority of
    Reclamation's centralized administrative services, the administrative
    staff has been reduced from 434 to 286 from fiscal year 1994 to 1997, a
    reduction of approximately 35 percent. This was also accompanied by a
    reduction in office space, telephones, and utilities. As a result, the
    MSO has reduced its own internal indirect costs by 35 percent.
        Under the Chief Financial Officer, a council of Reclamation
    managers reviews all indirect budgets for both consistency and
    reductions. Programs are discussed and line managers make decisions on
    those indirect costs needed for effective operations.
        Reclamation has also instituted standard processes for reviewing
    Reclamation-wide business processes and systems. This process has
    resulted in cost savings through common business practices, careful
    scrutiny of what administrative computer systems are essential for
    efficient operations, and bulk buying of software. For example,
    Reclamation was able to save $5.3 million over three years by
    purchasing one bureau-wide Oracle license instead of site licenses.
        In another case, we were able to replace multiple timekeeping
    systems with one. The report recites other cost reduction measures in
    the regional offices which have been taken.
        Reclamation also continues to review overhead costs charged to a
    project on a project-by-project basis to ensure that these costs are
    properly accounted and charged, and make corrections, as necessary. We
    are also taking a look at reimbursable O&M costs and assessments that
    impact the project.
        Question. I believe that in the past, the Bureau of Reclamation has
    indicated that there was around $75 million of deferred maintenance
    work. What is your current estimate of deferred maintenance work?
        Answer. In our Financial Statement for fiscal year 1998 we reported
    about $12 million in deferred maintenance on our ``reserved works'' in
    accordance with the requirements of the Statement of Federal Financial
    Accounting Standards No. 6. The reported number reflects the
    redefinition of deferred maintenance under the new standard and is
    consistent with the reporting for reserved works, which is O&M'd by
    Reclamation. ``Reserved works'' are project facilities which
    Reclamation operates and maintains with its own personnel, as opposed
    to ``transferred works'' which are project facilities operated and
    maintained by Reclamation's water and power customers at their own
    expense pursuant to contracts with Reclamation.
        Question. How much of the work is important to efficient and
    effective operation of essential operational facilities and structures?
        Answer. Reclamation does not defer any ``critical'' maintenance
    which is needed to protect public safety and to ensure the delivery of
    water and power to its contractors. Furthermore, none of this deferred
    maintenance will have adverse impacts to the efficient and effective
    operation of our facilities and structures at this time. However, if
    these maintenance items are not eventually funded, this could result in
    less than optimally efficient operations over time.
        Question. How does the Bureau of Reclamation plan to address the
    backlog of deferred maintenance in future years?
        Answer. Reclamation continues to prioritize its maintenance
    activities to ensure that the highest priority work is completed in a
    timely manner. Should any deferred maintenance item become, for some
    reason, critical maintenance, it will be given priority and
    accomplished immediately. We also continue to look for direct funding
    arrangements with our contractors so that there will be sufficient
    funding, when coupled with appropriated dollars, to ensure that
    Reclamation does not accumulate a ``backlog'' of ever growing deferred
    maintenance.
        Question. Do future budget planning targets accommodate increased
    funding for reducing the backlog?
        Answer. Reclamation believes it has adequate funding to prevent
    deferred maintenance from significantly increasing in the future.
                               dam safety program
                   initiate safety of dams corrective actions
        The fiscal year 1999 Energy and Water Appropriations Bill, while
    reducing Reclamation's budget request for the Dam Safety Program,
    provided a sizable increase over the 1998 appropriation. The funding
    request for fiscal year 2000 again reflects a significant increase over
    the previous year appropriation.
        Question. Have you experienced or do you anticipate any major
    problems in carrying out the program with the funding provided for the
    current fiscal year, particularly in Initiate Safety of Dams Corrective
    Actions activities?
        Answer. Congress reduced the fiscal year 1999 Dam Safety Program
    request by $8,787,000. As a result, Reclamation rescheduled Safety of
    Dams activities and costs into fiscal year 2000. At this time, we
    anticipate being able to carry out the restructured fiscal year 1999
    program with the funding provided.
        However, shifting activities from fiscal year 1999 into fiscal year
    2000 impacts the flexibility to aggressively pursue risk reduction
    actions at Reclamation dams in fiscal year 2000. Keechelus Dam, Yakima
    Project, Washington, and Casitas Dam, Ventura River Project, California
    have critical Safety of Dams issues that require modifications of
    significant cost and scope. Current enacted funding and requests will
    be managed to focus funding to these dams and critical Safety of Dams
    issues at other dams. Funding at the President's Request level for the
    fiscal year 2000 Dam Safety Program is needed to avoid delaying
    critical public risk reduction efforts.
                       safety evaluation of existing dams
        Question. What accounts for the increase from $14.2 million in
    fiscal year 1999 to $17 million requested in fiscal year 2000 for the
    Safety Evaluation of Existing Dams activities?
        Answer. Ensuring the safety and reliability of Reclamation dams is
    one of the agency's highest priorities. In 1997, the Commissioner
    tasked an independent team of dam safety professionals to review
    Reclamation's dam safety practices to identify best practices already
    in place and make recommendations for improvements. As a result of
    recommendations from the peer review team and Reclamation's own
    internal initiatives endorsed by the peer review team, more focus and
    vigilance has been directed at key activities such as examinations of
    dams, dam performance monitoring, and engineering analyses of dams to
    reliably define and manage risks across Reclamation's inventory of 362
    dams. These activities are conducted under the Safety Evaluation of
    Existing Dams and are primarily responsible for the requested increase
    from $14.2 million in fiscal year 1999 to $17 million in fiscal year
    2000.
                            initiate safety of dams
        Question. Now the funding request for fiscal year 2000 for the
    Initiate Safety of Dams Corrective Actions program is $42.7 million, an
    increase of $10.4 million over the amount provided for the current
    fiscal year. What accounts for this large increase?
        Answer. The fiscal year 2000 request of $42.7 million does not
    represent a large increase when compared to the original fiscal year
    1999 request. Reclamation's request for fiscal year 1999 was $41.25
    million, which Congress reduced by $8,787,000. One of the reasons for a
    comparable request in fiscal year 2000, is that modifications of
    significant cost and scope are required at Keechelus Dam, Yakima
    Project, Washington, and Casitas Dam, Ventura River Project,
    California, which have critical Safety of Dams issues. In addition,
    modifications activities are planned to reduce risks for identified
    safety issues at six other dams.
        Initiate Safety of Dams Corrective Actions is a portfolio request
    for the planned Safety of Dams modifications not currently underway.
    After these Safety of Dams projects are formulated and submitted to
    Congress through the modification report process required by the Safety
    of Dams Act, funds and future requests are transferred from ISCA to a
    specific project line item. As these transfers occur, ISCA is lowered a
    corresponding amount which often creates the appearance that prior year
    ISCA funding is lower than current requests.
        As a result, a true comparison of Safety of Dams funding levels
    between fiscal years is only achieved by combining the funding for ISCA
    with the funding for Safety of Dams modifications currently underway.
    Modifications are currently underway at Bradbury, Horse Mesa, Lost
    Creek, Twin Buttes, Pueblo, and Reservoir A Dams which total $10
    million enacted in fiscal year 1999 and $8.8 million requested in
    fiscal year 2000. When these ongoing projects are combined with ISCA,
    enacted fiscal year 1999 Reclamation Safety of Dams funding totals
    $42.46 million. Prior to the Congressional reduction the fiscal year
    1999 total was $51.25 million. The total Safety of Dams request for
    fiscal year 2000 is $51.56 million which consist of the $42.7 million
    in ISCA and the $8.8 million for the ongoing modifications.
        The level of funding necessary to carry out an effective dam safety
    program to reduce risk to the public varies from year to year, and
    depends on the specific dams for which deficiencies have been
    identified as needing modification. The fiscal year 2000 request is
    substantially below the $87.8 million funding level provided in fiscal
    year 1996. Large scale modifications were ongoing at Theodore Roosevelt
    Dam and Bartlett Dam in Arizona and the initiation of the modification
    work at Twin Buttes Dam in Texas began that year. While most projects
    are not of this magnitude, this represents the wide variation in
    funding that may be needed from year to year.
                                   pueblo dam
        Question. The Committee has received information from the Family
    Farm Alliance which indicates that the Bureau of Reclamation's
    administration and non-construction costs for the Pueblo Dam, Safety of
    Dams repair project (design, engineering, oversight, construction
    management, etc.) adds around 50 percent to the cost of this
    construction project. By comparison, the private sector standards use
    15-20 percent as a reasonable factor to administer a construction
    project of this type. Does a 50 percent factor to administer a Bureau
    construction project seem reasonable to you?
        Answer. We believe that a 50 percent non-contract costs for a dam
    safety project may be reasonable. We do not believe that it is
    appropriate for Reclamation's performance on critical public safety
    issues to be measured on the basis of non-contract to contract costs.
    Reclamation's primary responsibility is to ensure the safety of the
    public downstream of the dam, and we believe that the public and the
    water users are best served by obtaining the lowest total project cost
    which also provides the necessary public risk reduction and the
    assurance of continued long term, verifiable performance of the
    structure.
        Reclamation's experience has shown that total project costs can
    generally be reduced through rigorous project investigations, planning,
    and design, or ``non-contract'' costs. The Pueblo Dam Safety of Dams
    modification project provides an excellent example of this effort.
    Through extensive design effort, Reclamation reduced the cost of the
    proposed repairs by $8 million or 36 percent. Since the cost of the
    contract for construction was appreciably reduced, the ratio of
    administration and non-construction costs to construction contractor
    costs has correspondingly increased. During project formulation and
    design, Reclamation consulted extensively with an Independent
    Consulting Panel of dam design experts. The Panel originally
    recommended a totally ``active resistance'' solution which had an
    estimated construction cost of $22 million. Through significant study
    and design efforts, Reclamation formulated a more cost-effective
    alternative at $14 million that both met design requirements and was
    acceptable to the Panel. Also, during final design, a hydraulic model
    study was completed on the design of the modified spillway. This study
    resulted in changes to the design of the spillway energy dissipation
    structure and resulted in contract savings estimated at $2 million. The
    cost of the model study was less than $100,000.
        These are two examples of reasonable non-contract expenditures
    resulting in significant cost savings. Although both efforts resulted
    in increased non-contract costs and increased the calculated percentage
    of non-contract costs to contract costs, they also resulted in far
    greater reductions in the total project costs. Public trust, safety
    issues, and Federal Guidelines for Dam Safety require significant
    quality control and designer oversight throughout the duration of the
    project, which cannot be compromised.
        Question. Is it unreasonable to think that the Bureau of
    Reclamation should be able to conform to the same 15-20 percent
    standard of the private sector?
        Answer. Reclamation is not aware of any study or private sector
    standard that establishes a 15 to 20 percent range for activities
    similar to the administration and non-construction activities for the
    modification work at Pueblo Dam. Neither is Reclamation aware of any
    private sector entity that performs all of the functions included in
    the calculated 50 percent factor. Reclamation's 50 percent non-contract
    figure cited in the Family Farm Alliance information includes all
    project costs from early investigations through the completion of
    construction and refilling the modified facility, not simply the
    construction administration costs. The non-contract costs--which are
    costs not directly paid to the construction contractor--for Safety of
    Dams modifications include all costs for project activities related to
    Reclamation's roles as owner, operator, and regulatory agency for
    Pueblo Dam. These activities include planning and project formulation,
    field investigations and data collection, environmental compliance,
    securing Executive Branch and Congressional approval and funding for
    the project, extensive coordination of project activities with the
    water users associated with the facility, including an independent
    review of specifications by the water user's consultant, negotiation of
    appropriate repayment contracts, final design, development of drawings
    and specifications, procurement, construction management, quality
    control, construction contract administration, design and construction
    documentation, and monitoring of the modified facility during first
    filling as well as independent consultant review of all project
    activities. We believe that Reclamation's activities and associated
    costs are appropriate in addressing the critical public safety issues
    at Pueblo Dam.
        Reclamation believes that the average private sector project
    management fee percentage cited in the Family Farm Alliance information
    does not include costs for project management activities such as field
    investigations, planning level studies; securing approval and funding
    for the project, the development of repayment studies for project
    repayment, which are required by the Reclamation Safety of Dams Act;
    quality control during construction; dam safety regulatory agency costs
    and fees; dam owner contract administration, oversight and review
    activities; verification of adequate performance during first filling
    of the modified dam; and the independent consultant panel's review of
    project activities.
        Question. What factors would cause the Bureau's construction
    management costs to be so much above the private sector?
        Answer. Reclamation believes that a comprehensive cost comparison
    that includes costs for all activities on a similar project would
    indicate that private sector costs would be comparable to Reclamation's
    for similar activities. Reclamation attempts to construct the most cost
    effective and reliable modification considering total project costs.
    One factor that could make it ``appear'' that Reclamation's
    construction management costs are high, based on percentages, compared
    to the private sector, is our decision to construct the least cost
    technically acceptable alternative to modify a dam. The decision at
    Pueblo Dam was to use a ``state of the art'' construction material
    referred to as Roller Compacted Concrete in a technically challenging
    manner. This decision resulted in the lowest ``total'' project costs.
    The use of RCC resulted in extremely low construction costs. However,
    it required extraordinary construction management activities to ensure
    flaws were not introduced during construction of the modifications.
    Failure of Pueblo Dam would endanger more than 14,000 lives.
    Reclamation views it as critical that we ensure the design intent is
    met by the modifications that are constructed.
        Question. Is this common in other Safety of Dams work or other
    construction projects Reclamation wide?
        Answer. Reclamation has estimated the total non-contract costs for
    the activities outlined above to be approximately $8.8 million or about
    34 percent of the total project cost and 52 percent of the contract
    cost. This is in line with the range of non-contract costs for other
    Reclamation dam safety modifications as identified through a 1995 audit
    by the Office of the Inspector General. The audit found that
    Reclamation's non-contract costs ranged from 41 percent to 60 percent
    of contract costs for five projects of similar size to Pueblo Dam under
    construction at the time of the audit.
        Question. Does the Bureau of Reclamation have procedures in place
    to ensure these types of indirect costs are held to a minimum, and that
    activities which exceed a set standard are highlighted for management
    attention at the Area, Regional or Headquarters level?
        Answer. Reclamation utilizes a Project Management Team to
    administer and oversee all activities related to the planning, design,
    and construction of dam safety modifications. This includes development
    and monitoring of project schedules and costs. All significant issues
    related to the project are communicated to the Area Manager, Regional
    Director and the Chief of the Dam Safety Office for decision and
    appropriate action. Reclamation believes that the Project Management
    Team provides a cost-effective means of ensuring an appropriate level
    of project oversight and organizational review when addressing critical
    public safety issues under the Safety of Dams program.
                              year 2000 compliance
        In testimony last year and in the budget justification for fiscal
    year 2000, you indicate an on-going effort to address the issue of
    embedded microchips in equipment throughout the Bureau of Reclamation.
        Question. What was the outcome of the inventory of embedded
    microchips, which I believe was to be completed last summer? What types
    of equipment were found deficient and were any of those mission
    sensitive? What is your schedule to have all mission critical systems
    and devices with embedded microchips compliant?
        Answer. We have conducted and essentially completed an inventory of
    all embedded microchip, or EMC, systems and devices, about half of
    which are considered mission critical. Our most important systems are
    Supervisory Control and Data Acquisition, or SCADA, controls which
    control automatic operations of power generation and water delivery.
    SCADA systems include software, EMC devices, and telecommunications
    equipment.
        Reclamation is confirming completion and accuracy of the inventory
    of telecommunication components, EMC devices, computer applications,
    computer hardware and peripherals, commercial off-the-shelf software,
    and other types of computer applications. This inventory is estimated
    to be 98 percent complete. Mission critical equipment and systems are
    being tested according to a standard checklist that involves removing
    equipment from service, ensuring backup systems are in place, setting
    dates, observing the equipment as the date rolls over, restoring the
    present date and time, ensuring proper operation, and returning the
    equipment to service. Testing has shown that most equipment and systems
    are Y2K compliant. Over 80 percent of mission critical EMC's are
    compliant. Non-compliant mission critical equipment is being
    remediated. Most tests have been performed by Reclamation personnel and
    a few contractors. Independent verification has been performed by
    Reclamation personnel who were not involved in original testing, often
    from other facilities. Contractors have been used in the Pacific
    Northwest and Great Plains Regions. No Y2K problems were experienced
    during the changeover from 1998 to 1999, and no problems are expected
    on other dates. However, Y2K testing and planning efforts will address
    the following critical dates: April 9, 1999 (99th day of 99); September
    9, 1999 (9/9/99); December 31, 1999 to January 1, 2000; and February 28
    to February 29, 2000 (Leap Year). Although, we may find additional EMC
    devices that require testing, our plan is to have all currently
    identified EMC devices tested and remediated where necessary by June
    30, 1999.
        Question. Does the Bureau of Reclamation have a plan in place to
    correct the problem? What is the estimated cost to correct the problem?
    Is sufficient funding being requested in fiscal year 2000 to take care
    of the important work?
        Answer. Beginning in March 1997, Reclamation undertook an
    aggressive effort to identify and correct potential Y2K related system
    deficiencies. Many of these systems directly support Reclamation's
    ability to generate power and regulate water.
        Electrical Power Systems.--Reclamation is working closely with the
    Power Marketing Administrations (PMA's) and the North American Electric
    Reliability Council (NERC) to assure that potential failure of certain
    computer systems on January 1, 2000, does not result in the collapse of
    the electric grid. Reclamation is currently verifying its inventory of
    embedded microchips in its power control and operating systems and is
    taking steps to renovate any noncompliant devices, conduct independent
    validation and verification testing, certify all embedded chips as Y2K
    compliant, and prepare contingency plans to counter any unforseen
    circumstances. In addition, Reclamation is working with the PMA's,
    NERC, and the regional Western Systems Coordinating Council (WSCC) in
    the Y2K system-wide exercises scheduled for April and September. These
    exercises are to verify the integrity and the operational preparedness
    of the interconnected power system.
        Utilities.--Letters have been sent and meetings held with partners,
    utilities, and electric reliability councils, such as the Western Area
    Power Administration, the Bonneville Power Administration, and the
    Western Systems Coordinating Council to address Y2K power system
    vulnerability.
        Coordination with External Partners and Clients.--Reclamation has
    contacted its water and power partners and customers, i.e., water
    companies, irrigation districts, water districts, and Native American
    tribes. Several entities have stated that they have been aggressively
    working to ensure their equipment and systems function properly for the
    upcoming critical dates. In many cases, we have received inventory
    information and in others we were requested to assist in assessing and
    completing Y2K readiness activities.
        Contingency Planning.--Reclamation contingency planning includes
    equipment-specific plans; facility-level plans; and power operation,
    water, and dam safety contingency plans. The plans reference continuity
    of operations, emergency action plans, standing operation procedures,
    and use of additional staff. The plans also address critical disruption
    periods, and we are continuing to prepare for logistical support.
        Estimated Cost Summary.--The total estimated cost (not including
    labor) for Y2K related activities for fiscal year 1997 through
    completion is $10.4 million. We believe that all major work will be
    completed with fiscal year 1999 funding.
        Question. Now the Bureau of Reclamation had identified 63 computer
    systems which were not Year 2000 compliant. How many of those systems
    are mission critical and what is the status of bringing them into
    compliance?
        Answer. Reclamation identified 16 mission-critical applications
    from the original 63 applications inventoried. All 16 are complete and
    implemented. All but three of the remaining 47 non-mission critical
    systems are complete, and they are scheduled for completion by March
    31, 1999. This includes testing and implementation. Newly acquired/
    developed systems/applications are being tested prior to
    implementation.
        Question. Are you on schedule to have all computers identified as
    non-Y2K compliant corrected prior to the year 2000?
        Answer. Yes, Reclamation's computer system infrastructure will be
    Y2K ready. It consists of the following:
        Mainframe Systems.--The only BOR mainframe is at the Denver
    Administrative Service Center (DASC). The mainframe and its associated
    applications/systems are specific to the administration (payroll,
    personnel, and financial areas of business) of DOI's bureaus and other
    DASC clients, and have no impact on power and energy production. The
    systems have been tested and are Y2K compliant. (It should be noted
    that the DASC will be transferred to the Department of the Interior's
    National Business Center in April 1999).
        Office Systems.--Normal replacement procedures will ensure that all
    essential personal computers will be upgraded or replaced. All local
    area networks have been tested; required upgrades to software and
    hardware will be completed by March 31, 1999. Reclamation's Hewlett-
    Packard minicomputers have been successfully tested and certified
    compliant. The wide area network has been tested and is Y2K compliant.
                          cvp, american river division
                   nimbus fish hatchery interpretive facility
        Question. The budget request for Facility Operations includes funds
    to begin efforts in support of the Nimbus Fish Hatchery Interpretative
    Facility. Why does the Bureau consider this to be priority work which
    must be undertaken in fiscal year 2000?
        Answer. The Bureau of Reclamation is responsible for salmon and
    steelhead mitigation on the American River. The fish hatchery is
    located on the American River directly downstream from Lake Natoma and
    Nimbus Dam, approximately 15 miles from Sacramento. As part of the
    mitigation at the fish hatchery, which is operated by the California
    Department of Fish and Game, Reclamation is supporting a visitor
    facility to educate the public on the life cycle of the fish and the
    uses and benefits of the Central Valley Project. It is important for
    the public to understand the link between CVP project operations and
    measures to improve the anadromous fish health. Currently the facility
    is being staffed with volunteers, however, the public is coming to the
    hatchery in greater numbers every year and the workload has become too
    great to be adequately handled by volunteers.
        Question. How much of the $10.1 million requested for Facility
    Operations is for this work, and how, specifically, will the funds be
    used?
        Answer. Approximately $65,000 of the $10.1 million requested is for
    this work. The funds will be used by the California Department of Fish
    and Game to hire dedicated staff for the visitor facility. This project
    will consist of displays and interpretative specialists telling the
    story of the fish and the Central Valley Project. Information given out
    will consist of educational material on the salmon and steelhead,
    exhibits of their life cycle, enhanced viewing facilities, and guided
    tours of the hatchery.
                            central arizona project
        Question. The budget request includes $2.8 million to construct
    remaining recreational enhancement activities at Lake Pleasant Regional
    Park in Arizona. Have the Bureau of Reclamation and all interested
    parties agreed to the scope of the recreational development to be
    undertaken and to a cost sharing agreement as appropriate?
        Answer. The Bureau of Reclamation and Maricopa County agreed to the
    scope of recreational development under the Lake Pleasant Regional Park
    Master Plan, approved by Reclamation on March 10, 1995. Cost sharing
    with Maricopa County was committed to under the Recreational Management
    Agreement dated June 29, 1990. The Recreational Management Agreement
    delineates replacement and enhancement obligations of Reclamation, as
    well as long-term management roles for Reclamation and Maricopa County.
    The major replacement items will be completed in fiscal year 1999. The
    agreement contains an $8 million Federal enhancement ceiling which is
    subject to indexing, of which $2.8 million remains. The enhancement
    obligation includes a 50 percent cost share obligation with Maricopa
    County. The remaining recreational development as identified in the
    Lake Pleasant Regional Park Master Plan includes group and family
    campground areas, picnic sites, boat launching facilities, improved
    public access, environmental education support, and public safety.
                              yuma desalting plant
        Question. The budget request includes $3 million to begin a long-
    term program to replace deteriorated membrane elements or look at a
    water banking program with the Basin states to offset the need to
    recover drainage water. Why is the Bureau exploring such options? Was a
    detailed analysis of a broad range of options undertaken? Why were
    these two approaches selected for possible funding in fiscal year 2000?
    What is the total estimated cost of the two budgeted options and over
    what period of time?
        Answer. Under Title I of the 1974 Colorado River Basin Salinity
    Control Act, during what is called the ``interim period,'' which is
    defined as that period of time when all of California's water contracts
    for Colorado River water can be met, savings from lining of the
    Coachella Canal of 132,000 acre-feet per year are used to offset pumped
    drainage return flows from Wellton-Mohawk that are diverted around
    Morelos Dam via the Bypass Drain and thus are not delivered to Mexico
    as part of their annual Colorado River water entitlement. Also, any
    time flood control releases are made from Hoover Dam, any accrued
    obligation to replace drainage water from Wellton-Mohawk that has been
    bypassed around Morelos Dam is automatically terminated.
        Once the interim period ends, which will occur when sufficient
    Colorado River system water is not available to meet all of
    California's needs for Colorado River water, California begins to get
    credit for the savings that resulted from lining the Coachella Canal
    and the United States must provide an alternative source for replacing
    the drainage return flows from Wellton-Mohawk. The United States has
    two ways in which it could meet this obligation: one is to operate the
    Yuma Desalting Plant to improve the quality of drainage water from
    Wellton-Mohawk so it can be delivered to Mexico as part of its annual
    Colorado River water entitlement; and another is to find a replacement
    source to offset the drainage water being bypassed around Morelos Dam.
        Reclamation has been actively looking at alternatives to operating
    the Yuma Desalting Plant for a number of years. We have considered a
    range of alternatives and after considering such factors as costs, ease
    of implementation and institutional constraints, we have concluded that
    water banking is an approach warranting serious consideration at this
    time. Under this approach, we would divert surplus Colorado River
    water, since reservoirs are completely full and likely to spill, store
    the water in underground aquifers in Arizona or California, and recover
    the water in future years when it is needed to meet our obligation
    under the Salinity Control Act. This would be done in close
    consultation with the Colorado River Basin States and Tribes.
        As a minimum, Reclamation would like to bank enough water to offset
    drainage return flows from Wellton-Mohawk for a period of at least 2
    years, or to offset the reject stream from the Yuma Desalting Plant for
    several years should the plant be operated.
        We are reasonably certain that a water banking program can be
    implemented and are planning to utilize all of the $3 million requested
    in fiscal year 2000 for this program. However, if surplus water is not
    available, or we cannot successfully negotiate a banking agreement, we
    could alternatively use this funding for membrane replacement.
        We currently have enough membranes to operate the Yuma Desalting
    Plant at full capacity for 1 year. After each year of operation we
    would have to replace approximately 20 percent of the membranes to
    maintain full plant capacity. As long as we have at least 2 years
    advance notice that the Yuma Desalting Plant will have to be operated,
    we can award a contract to allow manufacture for replacement of 20
    percent of the membranes each year to maintain the plant's ability to
    operate at full capacity.
        The total cost of replacement membranes for the entire plant is
    estimated to be $15 million, which if spread out over a 5-year period,
    because 20 percent of the membranes need replacement each year, the
    annual cost of membrane replacement would amount to $3 million per year
    to keep the plant operating at full capacity.
        Question. What does it cost annually to keep the Yuma Desalting
    Plant in a standby status?
        Answer. The total Title 1 budget submitted for fiscal year 2000 is
    $13,092,000. Within this budget, the annual cost to keep the Yuma
    Desalting Plant in ready-reserve standby status (meaning the plant
    could be put into full operation with 1 year's notice) is estimated to
    be approximately $1.5 million. The additional Title 1 funding is
    required for other activities such as operation and maintenance of the
    242 wellfield; operation and maintenance of the Bypass Drain; water
    banking; research; and other Title 1 activities.
        Question. Is shut down of the facility an option? If not, why?
        Answer. Reclamation does not believe that shut down of the facility
    is a currently viable option. First, a long-term replacement source for
    the Wellton-Mohawk drainage water has not been found to date, so the
    facility may have to be operated to meet our obligation to replace
    Wellton-Mohawk drainage water. The facility may also be needed for
    salinity control for water delivered to Mexico at the Northerly
    International Boundary at some time in the future. The facility is
    being considered as part of several options for a long-term solution to
    reducing the salinity of flows delivered to Mexico at the Southerly
    International Boundary with Mexico. Studies to improve the salinity of
    flows at the southern boundary are ongoing in response to a complaint
    from the Mexican government about the quality of water being delivered.
    Also, Reclamation is actively searching for potential non-Federal
    paying customers interested in product water from the facility.
                     long beach water reclamation and reuse
        Question. The Long Beach Area Water Reclamation Project is a
    proposed Title XVI new start for fiscal year 2000. It consists of two
    elements: the Alamitos Barrier Reclaimed Water project and the City of
    Long Beach Recycled Water System Expansion project. The first element
    is a tertiary treatment and reinjection system, and the second is
    expansion of an existing distribution system. Are these two projects
    separable?
        Answer. The expansion of the City of Long Beach Water Department
    Recycled Water Program will increase the use of reclaimed water for
    greenbelt irrigation and industrial purposes from the current 5,200
    acre-feet per year to 12,000 acre-feet per year. The Alamitos Barrier
    Project will further increase the use of reclaimed water to 22,000
    acre-feet per year.
        As we understand it, these project components are closely related
    and probably cannot be separated. In order for reclaimed water to be
    used for the sea water intrusion barrier, the City of Long Beach must
    first complete the expansion of the distribution system. These new
    pipelines must be sized to meet the needs of both the City's irrigation
    system and the sea water intrusion barrier injection system. This will
    require close and continuous cooperation of both operating entities. In
    addition, since both components are treated as a single project, the
    Federal share of total funding cannot exceed $20.0 million.
        Question. What is the importance in the Federal government
    participating in construction of a local distribution system?
        Answer. The Long Beach area is heavily dependent on imported water,
    either from the Colorado River or the San Francisco Bay/Delta in
    northern California. Both water sources have significant Federal and
    Reclamation investment in numerous water supply facilities. For every
    acre-foot of water reclaimed by the Long Beach project, a like amount
    will not have to be imported, thus helping California live within its
    4.4 million acre-foot allocation of Colorado River water and also
    reducing the water demand on the environmentally sensitive San
    Francisco-Sacramento-San Joaquin Bay/Delta.
        Congress recognized the importance in the Federal government
    participation in the construction of a local distribution system in
    Long Beach when it passed the Reclamation Recycling and Water
    Conservation Act of 1996 (Public Law 104-266), which amended Title XVI
    of Public Law 102-575, the Reclamation Wastewater and Groundwater Study
    and Facilities Act of 1992. This legislation authorized the Secretary
    of the Interior to provide up to 25 percent of the total cost of the
    Long Beach Area Water Reclamation and Reuse Project. This project has
    numerous environmental enhancement, water supply, and economic benefits
    that are of National importance. In providing the authority to make
    financial assistance available to the local project sponsors, Congress
    recognized that, without such Federal participation, this Title XVI
    project would likely not be implemented due to its relatively high cost
    and the current availability of cheaper imported water supplies.
        Each project component will be reclaiming and reusing wastewater
    that is currently being discharged to the San Gabriel River just a few
    miles inland from the Pacific Ocean. Reductions in wastewater
    discharges to the ocean have a positive impact on the environment. In
    addition, in keeping with the intent of Title XVI as amended, these
    project components will:
        (1)reduce, postpone, or eliminate development of new or expanded
    water supplies,
        (2) reduce or eliminate the use of existing diversions from natural
    watercourses or withdrawals from aquifers, and
        (3) reduce the demand on existing Federal water supply facilities.
        Because of the dependence on imported water, the project area is
    subject to water shortages due to the occurrence of drought, both
    locally and in far distant river basins. In addition, water shortages
    could occur following a major earthquake which could severely damage
    the two main aqueducts that convey water to the project area. These
    project components will help to assure a local water supply that will
    be reliable during droughts and earthquakes, thus helping to sustain a
    growing economic base that is of local, regional and National
    importance.
                               yuma area projects
        Question. The budget justification indicated that $22.1 million, an
    increase of $4.2 million over the amount appropriated for the current
    fiscal year will be allocated for work. What has necessitated the
    allocation of these additional funds, and where will this funding come
    from?
        Answer. As a result of the 1993 Gila River flood, 10,000,000 cubic
    yards of sediment was deposited in a 15-mile reach of the lower
    Colorado River, near Yuma, Arizona. The sediment created both domestic
    and international problems; the domestic problem being the high
    probability of flooding in and around the city of Yuma, and the
    international problem being extreme sediment transportation into
    Mexico's canal system. The $22.1 million in the fiscal year 1999 Yuma
    Area Projects, Facility Maintenance activity includes $4.2 million in
    carryover funding that was for sediment removal work originally
    scheduled in the fiscal year 1998 Yuma Area Projects Facility
    Maintenance activity, but was delayed because sites to deposit the
    dredged sediment could not be found.
        Question. What accounts for the sizable reduction in program level
    from $26.9 million in fiscal year 1999 to a level of $15.6 million for
    fiscal year 2000?
        Answer. The $26.9 million total fiscal year 1999 Yuma Area Projects
    program includes $4.6 million in fiscal year 1998 carryover funds, and
    an additional $7.1 million in the Facility Maintenance activity to
    finish the sediment removal in the riverbed. The $15.6 million total
    fiscal year 2000 request reflects the return to a normal ongoing Yuma
    Area Projects program, resulting in the sizable reduction in program
    level.
        Question. What is the backlog of essential maintenance and
    rehabilitation for the Yuma Area Projects?
        Answer. None of the Yuma Area Projects list of maintenance and
    rehabilitation work items is so essential that adverse effects to the
    efficient and effective operation of critical facilities and structures
    would occur in fiscal year 2000. The Yuma Area Projects list is
    prioritized so that under normal river conditions, adverse effects will
    not occur over the short term. The Yuma Area Projects list includes the
    replacement of heavy equipment, and repair of the Main Outlet Drain and
    the Main Outlet Drain Extension channels that are connected to, and
    convey Wellton-Mohawk drainage system return flows to the Gulf of
    California. Both the Main Outlet Drain and Main Outlet Drain Extension
    channels were damaged as a result of the 1993 Gila River flood.
                emergency planning and disaster response program
        Question. The budget for fiscal year 2000 proposed a new item
    called the Emergency Planning and Disaster Response program and
    includes a funding request of $360,000. Why has a separate program been
    created for these activities?
        Answer. While it is a new budget line item, it is not a new
    program. The title ``Emergency Planning and Disaster Response Program''
    covers three distinct ongoing program activities for Disaster Response
    and for Continuity of Operations. These ongoing activities were
    previously funded under the Dam Safety Program. Because of increased
    emphasis on emergency preparedness, a separate Facilities Operation
    line item has been identified in the request for fiscal year 2000.
        Question. How have these activities been funded in the past?
        Answer. To date, all three of these activities have been funded
    through the Dam Safety Program.
        Question. What does the Bureau expect the average annual funding
    requirement to be in future years?
        Answer. Since the funds requested for all three of these activities
    are for program management, the expectation is that the funding level
    should remain about the same.
        Question. Please provide for the record the legislative language
    which authorized appropriations for this program.
        Answer. Public Law 93-288, ``Robert T. Stafford Disaster Relief and
    Emergency Assistance Act'', as amended, Section 101.(b) states that:

              ``It is the intent of Congress, by this Act, to provide an
            orderly and continuing means of assistance by the Federal
            government to State and local governments in carrying out their
            responsibilities to alleviate the suffering and damage which
            result from such [see Section 101.(a)] disasters by--(1)
            revising and broadening the scope of existing disaster relief
            programs; (3) achieving greater coordination and responsiveness
            of disaster preparedness and relief programs; (6) providing
            Federal assistance programs for both public and private losses
            sustained in disasters.''

        Section 201.(a) states that:

              ``The President is authorized to establish a program of
            disaster preparedness that utilizes services of all appropriate
            agencies and includes--(1) preparation of disaster preparedness
            plans for mitigation, warning, emergency operations,
            rehabilitation, and recovery;''

        Section 303 states that:

              ``The President shall form emergency support teams of Federal
            personnel to be deployed in an area affected by a major
            disaster or emergency. Such emergency support teams shall
            assist the Federal coordinating officer in carrying out his
            responsibilities pursuant to this Act. Upon request of the
            President, the head of any Federal agency is directed to detail
            to temporary duty with the emergency support teams on either a
            reimbursable or nonreimbursable basis, as is determined
            necessary by the President, such personnel within the
            administrative jurisdiction of the head of the Federal agency
            as the President may need or believe to be useful for carrying
            out the functions of the emergency support teams, each such
            detail to be without loss of seniority, pay, or other employee
            status''.

        See also Section 402, Public Law 84-99, Flood Control and Coastal
    Emergencies, which directs the Army Corps of Engineers in how it will
    conduct its response to flood emergencies.
        For Continuity of Operations, the authorization is found in the
    National Security Act of 1947, Public Law 93-288, ``Robert T. Stafford
    Disaster Relief and Emergency Assistance Act'', as amended. Title VI of
    the Law is titled ``Emergency Preparedness'' and its purpose is,

              ``to provide a system of emergency preparedness for the
            protection of life and property in the United States from
            hazards and to vest responsibility for emergency preparedness
            jointly in the Federal government and the States and their
            political subdivisions. The Federal government shall provide
            necessary direction, coordination, and guidance, and shall
            provide necessary assistance, as authorized in this title so
            that a comprehensive emergency preparedness system exists for
            all hazards.''

        In October of last year President Clinton signed a major policy
    directive (PDD 67) requiring all Federal departments and agencies to
    have ``viable continuity of operations capability'' by October 21,
    1999. Presidential Decision Directive 67 states that:

              ``in the face of current and future dangers, it remains the
            policy of the United States to have in place a comprehensive
            and effective program to ensure survival of our constitutional
            form of government and continuity of essential Federal
            functions under all circumstances.''

        It also states that,

              ``As a baseline of preparedness and a foundation for the
            Continuity of Government, all Federal departments and agencies,
            including the Executive Office of the President, shall have in
            place viable Continuity of Operations capability.''

        Question. What is the rationale for including the request under
    Bureauwide programs and not under Policy and Administration?
        Answer. All three activities that make up the Emergency Planning
    and Disaster Response Program are Bureau- wide in scope and impact.
    They are not particularly policy-oriented or administrative in nature.
    They are directly associated with continued operation of our
    facilities. The activities are critical for Reclamation operations
    during emergencies and incidents. As a result, the most appropriate
    request is considered to be a separate line item identified to the
    Congress under the Facilities Operation program activities.
                 title xvi water reclamation and reuse program
        Question. The budget justification for the $2.2 million requested
    for the Title XVI Water Reclamation and Reuse Program includes language
    which indicates that the requested funds ``may also fund initiation of
    construction for specific water reclamation and reuse projects that
    have been determined to be both feasible and of high priority of
    Federal investment.'' Is the intent of this language to allow the
    Bureau to begin construction of a project when specific funding for
    initiation has not been approved by the Congress?
        Answer. The statement `` * * * may also fund initiation of
    construction for specific water reclamation and reuse projects that
    have been determined to be both feasible and of high priority of (for)
    Federal investment'' is a general statement about the overall program
    that would only apply if funds were specifically requested for
    construction and included in the section of the budget justification
    for the Title XVI Water Reclamation and Reuse Program entitled ``Work
    Proposed for fiscal year 2000''. No funds under this line item will be
    used for construction activities in fiscal year 2000. Funding requests
    for construction of water recycling projects in fiscal year 2000 are
    described on a project-by-project basis elsewhere in the budget
    justification document.
        Question. What is the rationale and authorization for such a
    provision?
        Answer. There is no intent to expend funds for construction
    activities on projects for which Congress has not provided funding. The
    President's request for $2.214 million is intended to be used to
    conduct feasibility studies on authorized projects and research on
    treatment technologies applicable to municipal, industrial and domestic
    wastewater and impaired ground and surface water as specified in the
    Reclamation Wastewater and Groundwater Study and Facilities Act of
    1992.
                                     ______

                      Questions Submitted by Senator Burns

                        montana safety of dams projects
        Question. Based upon your testimony to the Senate Committee on
    Energy and Natural Resources on March 3, you stated that ensuring dam
    safety and reliability of Reclamation dams continues to be a top
    priority. In your testimony you further explain that half of
    Reclamation dams were built during the first half of this century with
    outdated practices. I am concerned about this situation given the
    number of Reclamation dams in Montana and their deteriorating
    conditions. What are your plans to address this growing problem in
    Montana?
        Answer. The age of a dam does not necessarily mean the dam is
    unsafe or deteriorating. Continued safe performance is and remains a
    priority of the agency regardless of the age of the dam. Reclamation
    relies on a strong dam safety program to provide ongoing monitoring,
    inspections, and evaluations to readily identify issues and risks.
    Inspections range from at-least-monthly examinations by operating
    personnel, annual inspections performed by Area Office personnel, and
    periodic inspections performed by Regional Office engineering staff; to
    comprehensive examinations of all features of the dam and engineering
    evaluation of the design and performance of the dam in comparison to
    state-of-the-art criteria at least once every six years. When issues or
    conditions are identified that represent unreasonable public safety
    risks, the Safety of Dams program strives to implement cost-effective
    corrective actions in an expeditious manner.
        Question. How much funding is needed in fiscal year 2000 to restore
    the deteriorating dams in Montana?
        Answer. Reclamation's inspection program provides for timely
    maintenance and repair of dams to ensure that they are safe. The fiscal
    year 2000 Dam Safety Program request includes funding for ongoing
    activities for 15 Reclamation facilities in the State of Montana.
    However, there is only dam in Montana proposed for repair in fiscal
    year 2000. That is under the Initiate Safety of Dams Corrective Actions
    Program, where $1,500,000 is requested to start planned modifications
    to Willow Creek Dam, Sun River Project. A modification report will be
    transmitted to Congress for this project this year. Modifications will
    address issues related to internal erosion due to seepage and
    structural stability during earthquakes.
        In addition to the work being conducted in fiscal year 2000, let me
    note that modifications have been completed on the following dams in
    Montana: Como Dam, Bitterroot Project; Pishkun Dikes, Sun River
    Project; Clark Canyon Dam, East Bench Unit, Pick-Sloan Missouri Basin
    Program; Lake Sherburne Dam, Milk River Project; Gibson Dam, Sun River
    Project; Tiber Dam, Lower Marias Unit, Pick-Sloan Missouri Basin
    Program; Helena Valley Dam, Helena Valley Unit, Pick-Sloan Missouri
    Basin Program; and Phase I modifications to Willow Creek Dam to repair
    a large void discovered in the dam in 1996. Additional issues are
    currently being evaluated at Gibson Dam and Como Dam.
           lower yellowstone title transfer--intake diversionary dam
        Question. As I mentioned in this hearing, I have some concerns
    about the Bureau's progress to transfer completed water projects to
    local water districts, specifically the transfer of the Intake
    Diversionary Dam. I understand this transfer is not complete even
    though it has been completed for a number of years. Why is it taking so
    long to accomplish this transfer?
        Answer. On February 2, 1999, Commissioner Eluid Martinez of the
    Bureau of Reclamation testified to the House of Representatives
    Committee on Resources, Subcommittee on Water and Power. He stated it
    is important to understand the legal requirements involved with title
    transfer. Title does not automatically transfer when the district
    repays its construction obligation. Operation and maintenance
    responsibilities can be transferred to water users of Reclamation
    projects under Reclamation law, but this does not give them title to
    the facilities. Section 6 of the Reclamation Act 1902 provides that
    title to the facilities ``shall remain in the Government until
    otherwise provided by Congress,'' under 32 Stat. 389; 43 U.S.C. section
    491. Also, Commissioner Martinez testified that the process needs to be
    open and inclusive of all stakeholders. There must also be compliance
    with the National Environmental Policy Act. The processes that are
    required under this Act ensure that the public has ample opportunity to
    participate in the process and have their concerns identified and
    addressed. Reclamation has been working with the Lower Yellowstone
    Board of Control to address specific items in accordance with
    Reclamation's Title Transfer Framework. Work to date includes a
    cultural resource survey of the entire Lower Yellowstone Project, a
    realty report for all Reclamation lands, and several seasons of
    fisheries data collection. Reclamation, in conjunction with the Montana
    Department of Fish Wildlife and Parks, the U.S. Fish and Wildlife
    Service and the U.S. Geological Survey, has been studying fish passage
    and entrainment issues associated with the Intake Diversion Dam and
    Lower Yellowstone Main Canal. Reclamation has provided funding for
    baseline data collection. The fourth and final year of fisheries data
    collection will be completed by October 1999. Although this work has
    taken several years to complete, the information is needed to fulfill
    policies in Reclamation's Title Transfer Framework and NEPA
    requirements, and will be used to support future progress.
        Question. What is left to be done to complete the transfer?
        Answer. Under the Reclamation Title Transfer Framework document, an
    agreement between Lower Yellowstone Board of Control and Reclamation
    needs to be developed that outlines what is required to complete
    transfer. Examples of the items that would be included under the
    agreement are the costs associated with completion of the realty work
    items, NEPA, and National Historic Preservation Act. The agreement
    would include discussion of schedule and assignment of roles and
    responsibilities to accomplish the work items. After execution of the
    agreement, the Title Transfer Framework document and NEPA require
    public scoping meetings to be held in the project area to gain input
    from local stake holders and provide feedback on issues.
        Question. What are your plans to complete this transfer?
        Answer. As previously stated, Reclamation is working with the LYBOC
    to develop an agreement outlining specific tasks, a schedule, cost
    estimates, and assignment of responsibilities. Reclamation and the
    LYBOC have developed a good working relationship and both parties are
    working toward completing the tasks necessary under the Title Transfer
    Framework.
        Question. What, if any, Congressional actions are needed to
    complete this transfer?
        Answer. The enacting legislation for this project did not include a
    provision for title transfer upon payout of the capital expenditures,
    therefore an act of Congress would be required to transfer title. We
    would be happy to assist in congressional efforts, if requested.
                                 cost overruns
        Question. I understand the Bureau is experiencing cost overruns and
    that these added costs are adversely impacting farmers and rangers \1\
    since you have shifted these costs onto them. Why is this happening and
    what measures are you doing to minimize cost overruns in these
    projects?
    ---------------------------------------------------------------------------
        \1\ Question was received with reference to farmers and rangers. We
    assume the reference should be farmers and ranchers.
    ---------------------------------------------------------------------------
        Answer. Reclamation projects in Montana were constructed during the
    period of about 1905 to 1970. In some cases, the costs to operate and
    maintain the facilities have increased due to extraordinary maintenance
    work (maintenance work which is of relatively high cost and of a
    specific duration and does not reoccur from year to year) that we have
    had to perform in recent years to insure integrity of the facilities.
    The extraordinary maintenance work is required to ensure that the
    facilities continue to provide authorized project benefits. In some
    cases, the estimates we provided to the irrigation districts (who are
    responsible for paying a percentage of the multipurpose operation and
    maintenance costs) varied from the actual cost to perform the work.
    Previously, as additional work items were identified, we did not always
    update the estimates at appropriate intervals and provide this
    information to the districts in sufficient time to allow them to budget
    for their share of the costs. The additional work performed was
    necessary to provide an adequate level of maintenance. In the past
    year, we have taken steps to improve the accuracy of these estimates
    and have a process in place to exchange information with the Irrigation
    Districts on an ongoing basis and to inform them of any anticipated
    increases in costs as soon as they are identified. Along this line,
    Reclamation is doing its best to provide more realistic cost estimates,
    find cheaper ways to do the work, and anticipate all of the work that
    would be reimbursed by the users.
        In conformance with the Commissioner's memorandum dated September
    18, 1998, we are committed to involving the irrigation districts in
    program formulation. We are and will continue to provide cost estimates
    and priorities for those parts of projects where our customers share in
    the responsibility or pay a portion of the costs. For Montana, these
    include the irrigation districts on the Milk River and irrigation
    districts benefiting from Pick-Sloan Canyon Ferry Unit. We meet
    annually with irrigation districts on the Milk River project to receive
    input on budget formulation. We have begun annual meetings with
    irrigation districts on the Pick-Sloan Canyon Ferry Unit to receive
    their input regarding budget formulation. In addition, we have
    committed to providing semiannual reports on the status of our costs.
        Question. Also, what alternatives have you considered to minimize
    adverse financial impacts on local irrigators?
        Answer. We have reviewed the costs associated with operation and
    maintenance program activities that we perform on an ongoing basis,
    which we refer to as our base O&M program. We are working toward cost
    containment for the base O&M program and attempting to limit increases
    for these activities to what would normally be expected to adjust for
    inflation. We have developed long-range O&M program plans that forecast
    major cost items for extraordinary maintenance. This information is
    provided to irrigation districts on an annual basis to provide as much
    lead time as possible for them to make financial adjustments and create
    reserve funds to pay their share of the costs before the work is
    performed and the costs incurred. We have also provided the irrigation
    districts with information on how to obtain State grants as a source of
    funding for their share of the reimbursable costs associated with the
    operation and maintenance of Reclamation projects.

    Memorandum From the United States Department of the Interior, Bureau of
                         Reclamation, Washington, D.C.

    In Reply Refer To: EC-100, SEP 24, 1998
    To: Regional Director, PN, MP, LO, UC, GP, Attention: PN-1000, MP-100,
            LC-1000, UC-100, GP-1000
        Director, Program Analysis Attention: D-5000
        All Area Managers and Program Managers
    From: Eluid L. Martinez, Commissioner
    Subject: Directive for Customer Involvement in Operations and
            Maintenance (O&M) Program Formulation

        The House Report 105-190 on the Energy and Water Development
    Appropriations Bill, 1998 states, in part

              ``The Committee strongly encourages the Bureau of Reclamation
            to create new opportunities for water and power contractors to
            participate in the review and development of O&M budget
            priorities for their respective Bureau of Reclamation
            projects.''

        The Statement of the Managers accompanying the Fiscal Year 1998
    Conference Report for the Energy and Water Development Appropriations
    Bill reiterated the support of the Conference Committee for this
    provision.
        Customer involvement assists in our effort to deliver quality
    services in the most efficient and economic manner. We have been
    working closely with many of our customers and customer organizations
    (i.e. water and power contractors) for several years in the formulation
    of the O&M program. We need to continue with activities that are
    responsive and helpful.
        In response to the Committees' encouragement and as an expansion of
    current efforts, I am establishing this customer involvement directive
    for use by Regional Directors and their managers with program
    responsibilities. This directive is to be used in working with
    customers who are interested in the development and implementation of
    the O&M program.
        Managers will:
        1. Contact customers to determine their level of interest and
    desired participation in program formulation.
        2. Provide interested customers with O&M programs, cost estimates
    and priorities for those parts of projects in which the customers share
    in responsibility or pay a portion of the cost. The focus will be on
    the budget being formulated in the Region (Budget Year +2). However,
    additional information may also be provided to serve as a bridge to
    Budget Year +2. The total package of information may cover four years
    including the prior year actual expenditures, current year program, the
    President's budget for the next fiscal year (Budget Year), and the
    Budget Year +2 projections. This information should be provided to the
    customers during the August to September time frame. Using fiscal year
    1998 as an example, the information would cover fiscal year 1997 actual
    expenditures, fiscal year 1998 program, fiscal year 1999 President's
    budget, and program projections for the fiscal year 2001 budget year.
    The fiscal year 2000 budget would be in embargo status, therefore
    unavailable (see table below as further reference). As part of the
    process, managers should be prepared to explain shifts from projected
    expenditures to actual expenditures for the prior year.

                 REFERENCE FOR AUGUST/SEPTEMBER 1998 TIME FRAME
    ------------------------------------------------------------------------
                                                                Budget
               Fiscal year                Time period      nomenclature and
                                                           status reference
    ------------------------------------------------------------------------
    1997............................  10-1-96/9-30-97...  Prior Year--
                                                           Completed
                                                           (Actuals).
    1998............................  10-1-97/9-3-98....  Current Year--
                                                           Program being
                                                           carried out.
    1999............................  10-1-98/9-30-99...  Budget Year--
                                                           Pending in
                                                           Congress.
    2000............................  10-1-99/9-30-00...  Budget Year +1--
                                                           Under review
                                                           within Department
                                                           and OMB
                                                           (embargoed).
    2001............................  10-1-00/9-30-01...  Budget Year +2--
                                                           Under development
                                                           within Region.
    ------------------------------------------------------------------------

        3. Provide interested customers the opportunity within a reasonable
    time frame (a minimum of 15 working days) to review and comment on work
    plans and cost estimates. Managers will provide responses either
    written or oral, as appropriate, to customers that address their
    comments.
        4. Notify interested customers of any changes in the work plans or
    cost estimates after the Regional budget deliberations (For example:
    the Regional deliberations on the fiscal year 2001 budget normally take
    place between October 1998 and January 1999) and before the Budget
    Review Committee (BRC) Regional meetings (2001 BRC Regional meetings
    normally occur in March 1999).
        5. Honor executive branch guidelines on non-disclosure of budget
    materials after the Regional budget deliberations and until the
    Presidents Budget goes to the Congress (for the fiscal year 2001 budget
    this will be in February of 2000).
        6. Review budget information with the customers, as requested,
    after the Congress receives the President's budget so that there is an
    understanding of Reclamation's proposed budget.
        The Director of Program Analysis is directed to incorporate this
    memorandum into the Reclamation Manual. In order to determine whether
    this directive is overly burdensome for Reclamation managers and also
    to determine whether it is meeting our customer's needs it will be
    reviewed after a full cycle of implementation, presumably in the Spring
    of 2002. In the interim there may be a need to adapt schedules
    contained herein to meet local circumstances. Although requiring an
    additional commitment of time for some managers, I believe this will
    provide our customers with a meaningful opportunity to comment on O&M
    activities that affect them.
                    yellowtail dam & bighorn lake operations
        As I mentioned at the hearing, the snowpack around Yellowtail Dam
    area is high this winter. People downstream of Yellowtail experienced
    massive flooding two years ago. They believe it was created by the
    Bureau's release of water from Yellowtail Dam.
        Question. What are the Bureau's plans to avoid flooding this year
    due to releases from Yellowtail Dam?
        Answer. As is the case with other Reclamation reservoirs with an
    authorized flood control purpose, the Army Corps of Engineers has the
    ultimate responsibility for all flood control operations of Bighorn
    Lake Yellowtail Dam. The amount of storage provided within the lake and
    the flood control afforded are determined by the Corps of Engineers'
    flood operating criteria for that particular reservoir. All flood
    control operations are closely and jointly coordinated between the
    Corps of Engineers and Reclamation.
        Yellowtail Dam and Bighorn Lake, in conjunction with Boysen and
    Buffalo Bill Reservoirs, played a major role in providing flood control
    along the Bighorn, Yellowstone and Missouri Rivers during the 1997
    runoff. Storage within and releases from these reservoirs were
    coordinated closely with instructions issued by the Corps of Engineers'
    in accordance with operating criteria for Bighorn Lake. Without the
    control provided by these reservoirs, the flooding along the
    Yellowstone River downstream of the mouth of the Bighorn River would
    have been much more severe. The Bighorn River Basin comprises about one
    half of the Yellowstone River drainage basin above the mouth of the
    Bighorn River. River flow of the Yellowstone River above the mouth of
    the Bighorn River is unregulated. Therefore, Reclamation is unable to
    provide flood protection against this unregulated flow. During 1997,
    flows in the Bighorn River were maintained within safe river channel
    capacity at all times.
        The Bureau of Reclamation is closely monitoring snowpack and is
    continually revising and updating monthly operating plans for Bighorn
    Lake. Snowpack in the Bighorn Basin is currently 113 percent of normal
    on March 15, nearly 20 percent lower than experienced in record water
    year 1997. Currently storage in Bighorn Lake has been evacuated about
    28.5 feet below the top of the joint-use pool. Plans are to continue
    evacuating storage to about 32.0 feet below the top of the joint-use
    pool by the end of March. As projected in the March plan and based on
    normal spring precipitation, this will provide adequate storage to
    store the snowmelt runoff without making large releases that may cause
    downstream flooding. Reclamation will continue to work with the Corps
    of Engineers, Federal Emergency Management Agency, and State and local
    constituents to provide information on operations plans for Yellowtail
    Dam.
        Question. What does the Bureau plan to do this spring to inform
    folks downstream from the mouth of the Bighorn River about water
    releases from Yellowtail Dam?
        Answer. Reclamation is responsible for monitoring the conditions of
    Yellowtail Dam and Bighorn Reservoir, as well as monitoring weather
    conditions upstream of the dam, that could result in the need to make
    large releases from the Dam. Reclamation is also responsible for
    providing notification of all significant incidents occurring at
    Yellowtail Dam to various Federal, State, and local authorities
    downstream of the Dam. This includes all affected downstream County
    Disaster & Emergency Services and law enforcement dispatch centers,
    Montana DES, and the National Weather Service, which is Federally
    mandated to issue flood watches and warnings. Additionally, Reclamation
    is responsible for providing notification to the National Park Service,
    Crow Tribe, and Bureau of Indian Affairs, as each of these agencies are
    also integrally involved with the operations of the Dam. Local
    authorities are responsible for notifying the public at risk, advising
    the public on safe evacuation routes, and where to go for safe shelter.
    It is not within Reclamation's authority or responsibility to directly
    carry out warning and evacuation of the impacted public from large
    operational releases.
        The Bureau of Reclamation continues to closely monitor snowpack and
    continually revise and update monthly operating plans for Bighorn Lake.
    These operating plans include projected operations of Yellowtail Dam
    and Bighorn Lake and are distributed to key members of the Yellowstone
    River Task Force. The Task Force is encouraged to contact Reclamation
    about any concerns or questions they may have regarding these operating
    plans.
        Daily information about the water levels in Bighorn Lake and
    streamflows in the Yellowstone and Bighorn River Basins is also
    available on the Bureau of Reclamation's Great Plains WEB site at
    address /www.gp.usbr.gov/.
        Question. What sort of early warning system have been or will be
    set up?
        Answer. All Reclamation dams are required to conform to agency
    policy established for emergency management. This policy and its
    implementation provides for the safety of the public during potential
    emergency incidents, including high releases, at these dams. Each dam
    has an Emergency Action Plan that describes what actions, including
    notification of local disaster and emergency management personnel, will
    take place during periods of emergency. These plans are exercised on a
    regular basis. Local, state, and other Federal organizations who might
    be involved in potential emergencies are encouraged to participate in
    the exercises and drills.
        Reclamation's Emergency Management Policy requires that Emergency
    Action Plans be developed and implemented at all significant and high
    hazard dams, including Yellowtail Dam. The EAP must contain initiating
    conditions for hydrologic (flooding) as well as nonhydrologic events,
    which trigger specific Reclamation response procedures and
    notifications to effected downstream agencies. Initiating conditions
    are typically established at levels that provide as much advance
    notification of significant incidents to local officials as
    practicable. EAPs must also contain descriptions of available
    communication capabilities, descriptions of potentially affected areas
    in the flood plain, flood inundation maps where appropriate, and tables
    showing floodwave travel times and other pertinent information that may
    be needed by local emergency management officials.
        On March 11, Reclamation met with County and State Disaster and
    Emergency Service officials, Bureau of Indian Affairs, Crow Tribe,
    National Weather Service and the National Park Service to plan an
    exercise to test the Emergency Action Plans for Yellowtail Dam and
    Yellowtail Afterbay Dam. The exercise is scheduled to be conducted on
    May 20, 1999. The DES staff is responsible for immediately contacting
    residents along the Bighorn and Yellowstone Rivers of any potential
    dangers that may result from downstream flooding. Yellowtail Dam is
    monitored 24 hours a day by the Casper Control Center to ensure
    downstream officials get advance notification, should a problem occur.
        Reclamation will continue to monitor daily snowpack and snowmelt
    runoff in the Bighorn River Basin and maintain close contact with the
    National Weather Service. The NWS will provide Reclamation with daily
    river forecasts based upon current hydrologic and forecasted climatic
    conditions. In addition to monitoring the mountain snowpack conditions,
    Reclamation will continue to utilize existing satellite telemetered
    gaging stations to monitor river conditions upstream and downstream of
    Yellowtail Dam and Bighorn Lake. As hydrologic and climatic conditions
    change, sudden changes may be required in reservoir and river
    operations. Reclamation will issue press releases to inform citizens
    living along the Yellowstone River of these operational changes.
        Question. Why hasn't the Bureau considered a stream flow monitoring
    device to ensure the safety of the downstream citizens and private
    property?
        Answer. On March 25, 1998, personnel from the Bureau of Reclamation
    attended a meeting with several citizens who live along the Yellowstone
    River near Hysham, Montana. Many people who attended the meeting
    believed installing another stream gaging station equipped with
    satellite telemetry along the Yellowstone River near Custer, Montana
    would improve the operations and management of Yellowtail Dam and
    Bighorn Lake.
        Reclamation currently utilizes data collected at 8 existing
    satellite telemetered river gaging stations located along the
    Yellowstone River from Corwin Springs, Montana to Sidney, Montana.
    Reclamation currently believes the data collected at these sites are
    adequate for monitoring river flows under most conditions and
    installing an additional station near Custer, upstream of the mouth of
    the Bighorn River, is not required to support the operations at
    Yellowtail Dam and Bighorn Lake. However, after the record water year
    of 1997, Reclamation provided funds for installing satellite telemetry
    at the stream gaging station located near Forsyth. Reclamation
    investigated the costs to install another satellite telemetered gaging
    station near Custer. It was determined costs to renovate and reactivate
    this site would cost $24,000. In addition to this cost, annual
    maintenance costs were estimated to vary from $6,000 for a seasonal
    station or $9,850 for an annual station.
        Reclamation has informed the Task Force that we are willing to
    provide funds in the amount of $7,500 for the installation of the
    satellite telemetry equipment. However no other resources have been
    identified to fund the remaining costs.
                 land management and fish & wildlife activities
        Question. I am getting concerned about the Bureau's growing
    activities into land management and fish and wildlife activities such
    as issuing grazing permits and conducting fish restoration projects.
    Have you considered shifting these responsibilities to more established
    Federal agencies who are more experienced and staffed to work on these
    activities such as the Bureau of Land Management and Fish & Wildlife
    Service. Wouldn't such a reinvention of governmental responsibilities
    allow you to refocus your limited resource toward the more well-
    established missions of the Bureau--to develop, manage, and protect
    water resources for power generation and recreation.
        Answer. The development of water projects by Reclamation required
    inclusion of lands necessary for operation of the projects. These lands
    were either withdrawn from settlement, sale, location of minerals, or
    entry under the general land laws or acquired for project purposes by
    purchase, condemnation, or donation by private landowners. Although
    these lands were withdrawn or acquired for Reclamation project
    purposes, the Secretary of the Interior was granted broad authority to
    allow use of the lands for incidental purposes, including grazing.
    Therefore, grazing is not a new activity; Reclamation has had these
    land management responsibilities since its inception and has a great
    deal of experience in implementing and managing these lease agreements.
    Where it is more efficient and appropriate to do so, we enter into
    agreements with other Federal agencies such as the Bureau of Land
    Management, Fish and Wildlife Service, or Forest Service to manage
    lands under our jurisdiction. Withdrawn lands that are no longer needed
    for project purposes are recommended for relinquishment and revocation
    to Bureau of Land Management or Forest Service jurisdiction.
        Reclamation's fish restoration activities have been undertaken in
    response to specific Reclamation project authorizations as well as
    congressional legislation such as the Endangered Species and the Fish
    and Wildlife Coordination Acts. We coordinate these activities with the
    Fish and Wildlife Service, state wildlife agencies and our water and
    power users. We must meet the requirements of such legislation in order
    to meet our contractual obligations to deliver the water and power
    benefits to authorized Reclamation We agree that our resources are
    limited, but solving fishery problems is vital for Reclamation's
    continuing mission to manage, develop, and protect water and related
    resources in an environmentally and economically sound manner.
                                     ______

                      Question Submitted by Senator Craig

                           snake river plain aquifer
        Question. The Snake River Plain Aquifer is the lifeblood of
    Southern Idaho. Its health is important to everyone that lives there,
    from the farmer who irrigates the food we eat to the mother who gives a
    glass of water to her child. It is also vital to Idaho's thriving
    aquaculture industry, which produces the vast majority of the nation's
    trout. Concerns have been raised about diminishing spring discharges.
    What is the Bureau of Reclamation's position on using excess flows in
    the Snake River to recharge the aquifer?
        Answer. The Bureau of Reclamation is participating in a
    demonstration project that will quantify and document the benefits and
    impacts of recharge projects in the Snake River Plain Aquifer. This
    project is a cooperative venture with the State of Idaho to investigate
    the feasibility of using managed aquifer recharge as an effective tool
    for conjunctive (ground water/surface water) water resource management
    in the Snake River Plain. Reclamation's contribution to the effort is
    to allow use of a canal for delivery of the water to the recharge site.
    This project should provide answers to many questions about the
    feasibility of using managed recharge as a tool for slowing, or
    stabilizing, the decline of the aquifer, thus providing more consistent
    flows downstream near the Thousand Springs area. This is especially
    critical during periods of drought.
                                     ______

                     Questions Submitted by Senator Dorgan

                            garrison diversion unit
        The Garrison Diversion Project is the key to water development in
    North Dakota and water development is the key to economic development
    in our semi-arid state.
        Question. Can you tell the Committee how this year's budget request
    will generally help North Dakota advance water development?
        Answer. The fiscal year 2000 request will be used to continue
    development of Indian irrigation facilities on the Standing Rock
    Reservation; to provide grant funds to continue State municipal, rural,
    and industrial (MR&I) water supply system development; to provide
    minimum maintenance to assure reliability of completed facilities still
    in construction status and operate the supply system for freshening
    flows; to continue mitigation activities associated with meeting refuge
    compatibility; to continue planning activities associated with a water
    supply to the Red River Valley; to provide flood control at Jamestown
    Dam and continue to operate, maintain, and replace facilities; and for
    construction and planning activities associated with recreation
    facilities. Reclamation will continue working with three Indian
    reservations in Garrison Diversion Unit (GDU) to operate, maintain, and
    replace existing MR&I water treatment and distribution facilities, and
    provide technical assistance and oversight for planning activities to
    meet reservation-wide needs.
        Question. Would you agree that completing work on the Southwest
    Pipeline, doing further work on the Northwest Area Waters Supply, and
    moving to Phase 2 on Indian MR&I mean that thousands of North Dakotans
    without reliable supplies of clean water will finally have access to
    the kind of water most of us take for granted?
        Answer. These types of projects have been successful in providing
    reliable, safe drinking water to thousands of people throughout the
    state whose previous supplies have been unreliable or have not met safe
    drinking water standards.
        Question. One of the funding priorities in the 1986 Garrison
    Reformulation Act was meeting the Municipal, Residential and Industrial
    water needs of Indian tribes in North Dakota. The tribes again have
    reached their funding ceilings which prompted the Congress to add
    funding to the last two appropriations bills. Can you assure the
    Subcommittee that the Bureau is prepared to work with us in raising the
    ceilings and identifying additional resources--in the range of $3
    million--to meet critical MR&I needs on the reservation?
        Answer. Reclamation has allocated funding to continue Indian MR&I
    planning and construction activities in each of the past two years in
    which the appropriation ceiling has been raised, fiscal year 1998 and
    fiscal year 1999. If the ceiling is raised again in fiscal year 2000,
    we anticipate that additional funds would be allocated to continue
    these ongoing activities.
        Question. Do you concur that Tribes in North Dakota have some of
    the poorest quality water in the nation and the Bureau has validated
    over $200 million in Indian MR&I needs?
        Answer. Studies have documented that the Indian reservations in
    North Dakota have significant domestic water supply problems. Studies
    commissioned for the Standing Rock, Fort Berthold, and Spirit Lake
    Indian Reservations have estimated that an additional $220,000,000
    could be required to complete facilities to meet all the reservation-
    wide needs. In addition, it is estimated that another $20,000,000 may
    be required to meet the domestic water supply needs on the Turtle
    Mountain Chippewa Indian Reservation. Reclamation is initiating a needs
    assessment study in fiscal year 1999 through the Native American
    Affairs Program to refine the needs of the Turtle Mountain Chippewa
    Tribe.
        Question. All but 11 of North Dakota's counties are losing
    population as farm communities face unparalleled problems from low
    prices, Canadian grain imports, severe weather disasters, among other
    factors. The MR&I program has helped breathe new economic life into
    communities across the state. Can you comment on the specific social
    and economic benefits of such projects as the Southwest Pipeline in
    bringing clean, dependable water supplies to towns in our state?
        Answer. The benefits associated with improved water quality can
    include better tasting water, water that does not corrode pipes and
    appliances, improved health, or some other improvement in lifestyle.
    Therefore, an improved water supply can help a rural area remain
    economically viable.
        Question. Several North Dakota communities have had been using
    tobacco-colored water or been in violation of Clean Water standards--
    through no fault of their own. Can you confirm how many ND communities
    have been able to comply with Clean Drinking Water standards as a
    result of Garrison projects?
        Answer. In preparing our response to this question, we consulted
    with the North Dakota State Water Commission (SWC) who administers the
    GDU MR&I State Grant Program. The SWC provided Reclamation with a
    spreadsheet, dated November 17, 1998, that summarizes the status of all
    projects that have submitted applications under this program. The SWC
    and the Garrison Diversion Conservancy District prioritize each of the
    projects that submit applications. One of the most important
    prioritization criteria is water quality, particularly documentation
    that existing water supplies are violating Safe Drinking Water
    standards. Based on SWC information, since the program began in 1986,
    the State has received 132 applications for water supply funding
    assistance, and 32 highest priority projects have been completed.
    Another 43 projects are in various stages of planning, design, and
    construction.
        Question. As you know, the Bureau of Reclamation has been studying
    the water development and management needs of the Red River Valley for
    the past year. Can you apprise the Committee of the status of these
    studies?
        Answer. The Phase IA Needs Assessment has been completed. Initial
    alternatives to meet the municipal, rural, and industrial water needs
    of the Red River Valley have been formulated. A working draft of the
    Phase 2 (alternatives Analysis) report will be forwarded to the
    Steering committee prior to our March 30th meeting. Phase IB Instream
    Flow report will be finalized by the end of March 1999, and the results
    will be incorporated into the Alternatives Analysis.
        Question. Has the Bureau worked closely with the ND State Water
    Commission, local communities and other interested parties to obtain
    their views and recommendations?
        Answer. The Bureau has been working closely with State and local
    interests to obtain their views and recommendations. It is expected
    that more meetings may be needed to assure that the views and interests
    of the State and local interests are fully considered prior to
    distribution of the public review draft. The Bureau's work is
    coordinated with a steering committee which is comprised of
    representatives of the ND State Water Commission, ND State Health
    Department, the Garrison Diversion Conservancy District, Fargo, Grand
    Forks, Moorehead, rural water systems, and the environmental community.
        Question. Can you please assure the Subcommittee that the Bureau
    will make these studies a top priority and work closely with ND
    agencies and groups?
        Answer. Completion of this study is a priority.
                          DEPARTMENT OF DEFENSE--CIVIL

                             Department of the Army

                           Corps of Engineers--Civil

    STATEMENT OF DR. JOSEPH W. WESTPHAL, ASSISTANT
                SECRETARY OF THE ARMY FOR CIVIL WORKS
    ACCOMPANIED BY:
            LT. GEN. JOE N. BALLARD, CHIEF OF ENGINEERS
            MAJ. GEN. RUSSELL L. FUHRMAN, DIRECTOR OF CIVIL WORKS

        Senator Domenici. Would the Corps of Engineers witnesses,
    General Ballard, Dr. Westphal, and any supporting witnesses
    come forward please?
        Thank you very much. Can we have order in the back of the
    room? If you would like to carry on conversations, could you do
    it in the hall please? Thank you very much.
        Dr. Westphal, it is good to see you. General Ballard,
    General Fuhrman its always a pleasure. And on the end----
        General Fuhrman. That is Fred Caver, sir. He is our budget
    and programs person.
        Senator Domenici. All right. Nice to have you with us. Yes,
    he is the budget man?
        General Fuhrman. Yes, sir.
        Senator Domenici. Dr. Westphal, we extend an especially
    warm welcome to you since this is your first appearance before
    the committee.
        The environment is certainly better this year than it was
    last year when we faced a very difficult budget from the
    administration where water projects were underfunded. Then we
    were expected to meet the demands of water projects in the
    country, and through the goodness of the chairman of the full
    committee, they gave us money from some other subcommittee for
    the water projects that the President did not fund.
        The Administration have gotten the message this year and
    the budget looks much better with reference to what you must do
    to complete your projects and maintain schedules for ongoing
    work. We hope to be able to meet those responsibilities within
    the President's budget.
        We have many Senators who want to be heard, so that is the
    extent of my statement. Unless somebody has an urgent, urgent
    statement, I would like to proceed to have the witnesses----

                          statement of senator stevens

        Senator Stevens. Could I just make one statement and ask a
    question? I want to go to another hearing.
        Senator Domenici. Absolutely.
        Senator Stevens. Good morning, General Ballard and Dr.
    Westphal.
        Dr. Westphal. Good morning, sir.
        General Ballard. Good morning, sir.
        Senator Stevens. I am here to state to you that we do
    appreciate the work that you do in Alaska. You are really
    involved in a number of important military projects. I
    discussed that with Colonel John yesterday.
        Our problem now is that we have, as you know, half the
    coastline of the United States, 55,000 miles of coastline, and
    our future development really is dependent upon our being able
    to get modern facilities there for the village areas in
    particular.

                         project cost sharing problems

        As we face this period of higher and higher costs of
    construction, one of the great problems that I face is how to
    deal with the local cost sharing formula that is involved with
    the Corps. These are areas that have no tax base at all, are
    primarily dependent upon the Federal Government, and are not
    very well represented in the State government because of the
    one man/one vote concept. We have an area the size of Texas
    that has one State representative.
        Now, when you look at it in terms of trying to get cost
    sharing for those areas, for the facilities they need to
    develop--I hate to use that word--the modern infrastructure for
    the next century, we just cannot deal with this cost sharing
    formula that has been worked out. I would like to know if you
    would be willing to sit down with us and see if we can find
    some way to justify--I take it it would take an Act of Congress
    to change your current formula. Is your current formula not
    based in law rather than regulation?
        Dr. Westphal. Yes, sir.
        Senator Stevens. Well, I have got to find some way to
    relieve some of these places of the burden of cost sharing
    where there is no tax base.
        Dr. Westphal. Well, Mr. Chairman, I think we need to work
    with you on developing some ability to pay mechanisms that
    might help these communities. The Chief and I are committed
    to--in fact, we have been talking about doing something about
    this issue nationwide, because there are communities all over
    the country that really in some cases absolutely cannot make
    the local match, yet they are in danger of flooding or they
    desperately need some infrastructure help. So, we are committed
    to finding ways in which we can help those communities either
    by adapting ability to pay provisions or simply coming to
    Congress and looking at some other vehicles for doing that for
    those particular communities in need. We will certainly be
    willing to work with you and members of your staff.
        Senator Stevens. Well, we worked it out once. The City of
    Buckland--I do not know if you are familiar with that little
    city. It has a sewage lagoon. That lagoon just happens to be in
    the center of the village. Over the years the waste water has
    gone directly into the lagoon in the middle of the village.
    Thanks to you, we now have an infrastructure demonstration
    project. You have a lot of flexibility on those demonstration
    projects.
        I am thinking of looking to this committee or to some
    committee to help us redefine what we can do in these areas
    where there is no potential for a local match. Most of us here
    had something to do with State government. I know I did in the
    State legislature. They have very little chance of getting a
    bill through the State legislature to give them an increased
    percentage of their local matched funds for projects that will
    enable them to compete with another area of the State.
        So, it is something that I would hope we would get some
    attention to, and I would look forward to working with you if
    you will do that for me.
        Dr. Westphal. We will, yes, sir.
        Senator Stevens. Thank you very much, Mr. Chairman.
        Senator Domenici. Thank you. Senator Stevens, we are aware
    of your problem and of some rural counties in the continental
    United States that actually have similar problems. We will try
    to work on that with your staff.
        Senator Stevens. Thank you.
        Senator Domenici. Would you please proceed, Dr. Westphal.

                      STATEMENT OF DR. JOSEPH W. WESTPHAL

        Dr. Westphal. Thank you, Mr. Chairman. It is an honor to be
    here to testify before this esteemed subcommittee, Mr.
    Chairman, and to testify and present to you the President's
    civil works budget for the 21st century. I think it is a good
    budget, Mr. Chairman.
        Accompanying me, as you mentioned earlier, is Lieutenant
    General Joe Ballard, who is the Chief of Engineers; and Major
    General Russ Fuhrman, who is the Director of Civil Works; and
    Mr. Fred Caver, who is the Chief, Programs Management Division
    for the Directorate of Civil Works.
        For just a second, Mr. Chairman, on a personal note, I just
    want to say how delighted I am to be here, the first time
    testifying before you. I began my professional career in
    Washington working for the House Budget Committee the year that
    you became chairman of the Senate Budget Committee. Of course,
    I am delighted to be here with my former boss and mentor,
    Senator Thad Cochran. It is a great opportunity to defend and
    to support a very strong program for civil works this year.
        Let me begin by noting that large differences between the
    administration's budget proposal last year and what you
    appropriated in both fiscal year 1998 and fiscal year 1999 are
    now reconciled in the fiscal year 2000 budget I am about to
    discuss.
        Mr. Chairman, I am just going to summarize a few points
    here in the interest of time and ask that my full testimony be
    made part of the record.

                                 budget themes

        The President has consistently stressed two major themes
    that I think are particularly important to the way we should
    formulate and implement a civil works policy. First, policy
    must be based on building strong partnerships with our States
    and local communities, as well as with other sister Federal
    agencies. And second, we must strive to help our economy grow
    and prosper by combining sound infrastructure management and
    development with environmental protection and ecosystem
    restoration. I believe our program excels in both of these
    mandates and that the budget we present today reflects their
    importance and priority.
        I am pleased to say that funding in the President's fiscal
    year 2000 budget supports a strong civil works program. It is
    consistent with levels enacted by Congress in recent years and
    with the President's overall domestic priorities, his
    commitment to a balanced budget, and his goal of protecting
    Social Security and meeting the challenges of the 21st century.

                                budget overview

        The President's budget for the civil works program for the
    year 2000 includes $3.9 billion for the discretionary program,
    comparable to the amount appropriated for the program in fiscal
    year 1999 and significantly above last year's budget. With
    cost-sharing contributions by our partners, the non-Federal
    sponsors, plus other funding, the fiscal year 2000 program will
    total about $4.2 billion. In fiscal year 2000, we will be
    asking non-Federal sponsors to contribute over $251 million as
    their cost share of projects throughout the Nation. They are
    our partners in this program and we are committed to a very
    responsive and timely allocation of resources to meet their
    efforts. I look forward to working with both houses of Congress
    to meet the challenges of this partnership.
        I would like to point out that the fiscal year 2000 budget
    for the civil works operation and maintenance general program
    is $1.84 billion. This level of funding is very strong,
    demonstrating the administration's commitment to maintaining
    our existing infrastructure, much of which is aging and
    requires greater upkeep.
        Funding for the construction general program is $1.24
    billion, a significant increase from last year's request.
        On new investments, the fiscal year 2000 budget for the
    Army civil works program provides a strong program of new work,
    including 1 new survey, 19 new construction projects, 5
    operation and maintenance new starts, and 6 new plant
    replacement and improvement program major acquisitions, and the
    Challenge 21 program.

                       water resource development process

        I also want to emphasize our commitment to water resources
    development and the biennial authorization cycle. A strong
    water resources development program is a sound investment in
    our Nation's economic future and environmental stability.
    Communities across the country benefit from water resources
    projects to reduce flood damages, compete more efficiently in
    world trade, provide needed water and power, provide
    recreational opportunities, and protect and restore our rich
    aquatic resources.
        In this regard, we will work with Congress to complete a
    water resources development act in 1999, building on the
    progress that we made last fall on the proposed 1998 bill.
    Further, it would put us in a better position to address new
    policy and project needs in a WRDA 2000 bill that will include
    such important initiatives as the restoration of the
    Everglades.

                              harbor services fund

        A key component of the President's 2000 budget for the Army
    civil works program is the proposal for a new harbor services
    user fee. This proposal will provide a reliable source of
    funding for important navigation needs, including construction,
    operation, and maintenance. It results in significantly greater
    funding for these port and harbor activities. The President's
    budget for fiscal year 2000 includes $951 million to be derived
    from the Harbor Services Fund, an overall increase of $382
    million over the President's fiscal year 1999 budget for harbor
    related activities. This level of funding will allow us to
    proceed at an optimal rate on nearly all operation and
    maintenance and construction activities related to ports and
    harbors, using funds contributed by the users.
        The user fees will generate funds sufficient to pay the
    Department of the Army's annual cost of developing, operating,
    and maintaining the Nation's ports. The legislative proposal
    will make the total amount of user fees collected pursuant to
    this proposed legislation in one year, available the next
    fiscal year for appropriations.
        We are coming to completion on the details of this proposal
    and discussions with stakeholders and comments from interested
    groups. A final proposal will come to you in the next few
    weeks, Mr. Chairman.
        The administration is also committed to the traditional
    mission areas of improving our navigation and transportation
    system, protecting our local communities from flood damages and
    other disasters and maintaining and improving hydropower
    facilities across the country.

                             environmental programs

        In addition, the protection and the restoration of the
    environment is an important and integral part of the civil
    works mission portfolio. The President has strongly advocated
    linking economic growth and protection of the environment. To
    help meet this objective, we will support projects that feature
    strong economic benefits, as well as incorporate environmental
    restoration and enhancement. Of course, individual
    environmental restoration projects are also an important part
    of the civil works mission.
        An example of a program that will integrate the
    environmental concerns into more traditional civil works
    missions is our Challenge 21 program, the riverine ecosystem
    restoration and flood hazard mitigation initiative. Like last
    year, this year's budget includes $25 million to begin the
    Challenge 21 program. It is designed to accomplish both flood
    hazard mitigation and ecosystem restoration and emphasizes
    nonstructural measures as a means of accomplishing these
    objectives.

                               regulatory program

        The fiscal year 2000 budget for the civil works regulatory
    program is $117 million, an increase of $11 million over the
    enacted level in fiscal year 1999 funding. In this program we
    are proud that we not only protect our vital aquatic resources,
    but we try to help people within the law to find
    environmentally sustainable solutions to their problems. In
    fiscal year 1998, the regulatory program authorized 90,000
    activities in writing, the most of any year, and nearly 95
    percent of all actions were authorized in less than 60 days.
    This budget will ensure that this level of service is
    maintained and improved, even with an increasing volume of
    work.
        In summary, the President's fiscal year 2000 budget for the
    civil works program is a good one. It demonstrates a commitment
    to civil works missions with strong support for all programs, a
    plan to solve the constitutional problem with the existing
    harbor maintenance tax, an especially strong program of new
    construction, a firm commitment to maintaining existing water
    resources management infrastructure and increased application
    of civil works program expertise to environmental protection
    and restoration.
        Mr. Chairman, I am delighted to be here with the Chief of
    Engineers. We have had an excellent working relationship since
    I took over this job. We are true partners in this process,
    along with the Director of Civil Works, in making sure that we
    address the interests of your constituents and the feasibility
    of moving this program forward at a very good pace in the
    future.

                               prepared statement

        With that, Mr. Chairman, I end my remarks and I thank the
    committee for the opportunity to testify today.
        [The statement follows:]

                  Prepared Statement of Dr. Joseph W. Westphal

                                  introduction
        It is an honor and a pleasure to testify before this esteemed
    subcommittee of the Appropriations Committee and to present to you,
    President Clinton's first Civil Works budget for the 21st Century. It
    is a good budget.
        Accompanying me are Lieutenant General Joe N. Ballard, Chief of
    Engineers; Major General Russell L. Fuhrman, Director of Civil Works;
    and Mr. Thomas F. Caver, Jr., Chief Programs Management Division,
    Directorate of Civil Works.
        Let me begin by noting that the large differences between the
    Administration's budget proposal last year and what you appropriated in
    both fiscal year 1998 and fiscal year 1999 are now reconciled in the
    fiscal year 2000 budget I am about to outline.
        The President has consistently stressed two major themes that I
    think are particularly important to the way we should formulate and
    implement Civil Works policy. First, it must be based on building
    strong partnerships with our states and local communities as well as
    among our sister federal agencies. Second, we must strive to help our
    economy grow and prosper by combining sound infrastructure management
    and development with environmental protection and ecosystem
    restoration. I believe our program excels in both of these mandates and
    that the budget I will present today reflects their importance and
    priority.
        I am pleased to say that funding in the President's fiscal year
    2000 Budget supports a strong Civil Works Program. It is consistent
    with levels enacted by Congress in recent years, and with the
    President's overall domestic priorities, his commitment to a balanced
    budget, and his goal of protecting Social Security and meeting the
    challenges of the 21 Century.
        My statement covers the following subjects:
      --the fiscal year 2000 Civil Works Program Budget,
      --Water Resources Development Acts of 1999 and 2000,
      --GPRA and Civil Works Program Performance,
      --the Harbor Services Fund Proposal,
      --the Economy and Environment,
      --New Investments, and
      --Highlights of the fiscal year 2000 Continuing Program.
                  fiscal year 2000 civil works program budget
        The President's budget for the Civil Works Program for fiscal year
    2000 includes $3.9 billion for the discretionary program, comparable to
    the amount appropriated for the program in fiscal year 1999, and
    significantly above last year's budget request. Details are presented
    in Table A.
        The Administration appreciates the significant commitments made by
    our partners, the non-federal sponsors who cost-share studies and
    projects of the Civil Works Program. These commitments demonstrate the
    value of the program to the sponsors. With cost- sharing contributions
    and other funding, total funding for the fiscal year 2000 program is
    $4.2 billion. In fiscal year 2000, we will be asking non-Federal
    sponsors to contribute over $251 million as their cost share of
    projects throughout the nation. They are our partners in this program
    and we are committed to a very responsive and timely allocation of
    resources to meet their efforts. I look forward to working with both
    Houses of Congress to meeting the challenges of this partnership.
               water resources development acts of 1999 and 2000
        I also want to emphasize our commitment to water resources
    development and the biennial authorization cycle. A strong water
    resources development program is a sound investment in our Nation's
    economic future and environmental stability. Communities across the
    country benefit from water resource projects to reduce flood damages,
    compete more efficiently in world trade, provide needed water and
    power, and protect and restore our rich aquatic resources. In this
    regard, we will work with the 3 Congress to complete a Water Resources
    Development Act (WRDA) in 1999--building on the progress that we made
    last fall on the proposed WRDA 98.
        As you know, the Army, on behalf of the Administration, submitted
    to Congress a WRDA proposal in 1998. This formed the basis for the
    Senate version of WRDA 98 that included important Administration policy
    initiatives such as our Challenge 21 program. We hope that, based on
    our bill, and the work of the authorizing Committees, we can come to
    closure on a responsible WRDA 99 early this year that includes
    important policy initiatives and vital projects, while recognizing the
    continuing budget constraints. Further, it would put us in a better
    position to address new policy and project needs in a WRDA 2000 bill
    that will include such important initiatives as the restoration of the
    Everglades.
                        civil works program performance
        The Government Performance and Results Act of 1993 (GPRA) requires
    that the Army Corps of Engineers show how improvements in its business
    processes impact the quality and delivery of our products and services
    to the Nation.
        The Corps is improving its business processes by streamlining
    decision document review procedures, eliminating duplication of
    functions at different levels; intensively monitoring policy review to
    reduce review times; extending the use of standardized project
    cooperation agreements; continuing to strengthen partnerships with
    local sponsors; and intensively managing program execution, for more
    efficient and timely production and greater customer satisfaction. In
    particular, the Chief of Engineers has developed a process to
    streamline project planning and I look forward to working with him on
    this.
        The Corps is currently implementing the first annual performance
    plan required by GPRA on its fiscal year 1999 program. The Corps is
    testing an initial set of results-oriented program performance measures
    to assess the benefits of process improvements made at the project
    level. The Corps will evaluate the initial set of results-oriented
    program performance measures during fiscal year 1999 program execution
    and will extend successful applications of the measures into the fiscal
    year 2000 program and continue to develop improved performance measures
    in the future.
                         harbor services fund proposal
        A key component of the President's fiscal year 2000 Budget for the
    Army Civil Works program is the proposal for a new Harbor Services Fund
    and Harbor Services User Fee. This proposal will provide a reliable
    source of funding for important navigation needs 4 including
    construction, operation, and maintenance. It results in significantly
    greater funding for these port and harbor activities. The President's
    Budget for fiscal year 2000 includes $951 million to be derived from
    the Harbor Services Fund, an overall increase of $382 million over the
    President's fiscal year 1999 Budget for harbor related activities. This
    level of funding will allow us to proceed at an optimal rate on nearly
    all operation and maintenance and construction activities related to
    ports and harbors, using funds contributed by the users.
        In March 1998, the U. S. Supreme Court ruled that the Harbor
    Maintenance Tax (HMT) was unconstitutional, as applied to exports. In
    that ruling, the Court concluded that the HMT, which imposed a charge
    based on the value of the commercial cargo being shipped, constituted a
    tax on goods in export transit and therefore violated the Export Clause
    of the Constitution. Because of this ruling, the HMT stopped being
    collected on exports on April 25, 1998. The new Harbor Services User
    Fee being proposed avoids the constitutional infirmities of the HMT.
    The assessment is a user fee, not a tax: it fairly approximates the
    harbor benefits and services vessels in each vessel category receive
    through port use. It is not imposed based on the cargo of a vessel.
        The user fees will generate funds sufficient to pay the Department
    of the Army's annual costs of developing, operating, and maintaining
    the Nation's ports. The legislative proposal will make the total amount
    of the user fees collected pursuant to this proposed legislation in one
    year available the next fiscal year for appropriation to fund the
    projected total annual expenditures of the Department of the Army for
    harbor development, operation, and maintenance.
        Thus, this proposal will address all of the biggest problems
    associated with the existing Harbor Maintenance Tax and Trust Fund
    (HMTF). First, we will stop collections on imports, domestic shippers,
    and passengers collected under the existing Harbor Maintenance Tax,
    eliminating the uncertainties involved with our foreign trading
    partners.
        Second, we would institute a new fee mechanism based on vessel type
    linking the fee with the level of service provided to certain types of
    vessels, which will meet the Supreme Court's test for
    constitutionality. Those fees would be placed in the new Harbor
    Services Fund, along with remaining balances from the old HMTF. A
    portion of those balances will be used to fund the program in the first
    year, fiscal year 2000.
        And third, the proposal will directly link the amount of fees
    collected with the funds appropriated, thus avoiding a build up
    balances in the Harbor Services Fund. For budget purposes, the user
    fees will be treated as offsetting collections.
        We are coming to completion on details of the proposal in light of
    discussions and comments from interested groups. We plan to present a
    legislative proposal to 5 Congress in the near future. Our plan is to
    pursue the HSF legislative proposal separately from WRDA 99.
                          economy and the environment
        The Administration is committed to the traditional mission areas of
    improving our navigation and transportation system, protection of our
    local communities from flood damages and other disasters, and
    maintaining and improving hydropower facilities across the country. In
    addition, the protection and restoration of the environment is an
    important and integral part of the Civil Works mission portfolio. The
    President has strongly advocated linking economic growth with
    protection of the environment. To help meet this objective, we will
    support projects that feature strong economic benefits, as well as
    projects that incorporate environmental restoration and enhancement. Of
    course, individual environmental restoration projects are also an
    important part of the Civil Works mission.
        An example of a program that will integrate environmental concerns
    into more traditional Civil Works missions is our Challenge 21:
    Riverine Ecosystem Restoration and Flood Hazard Mitigation Initiative.
    Like last year, this year's budget includes $25 M to begin the
    Challenge 21 program. It is designed to accomplish both flood hazard
    mitigation and ecosystem restoration and emphasizes nonstructural
    measures as a means to accomplish these objectives. Challenge 21 was
    proposed for authorization last year, and came close to becoming a
    reality in the proposed Water Resources Development Act of 1998. In
    fact, the Senate version of WRDA 1998 included a Challenge 21 program.
    We will continue to work with Congress to pass this much-needed
    legislation. The key to this program is that it will be implemented at
    the request of local communities and not imposed as a solution by the
    Federal government. To date, over 50 communities have expressed
    interest in participating in Challenge 21.
        Environmental programs make up about 18 percent of the fiscal year
    2000 Army Civil Works budget, and are integrated into all of the major
    areas of work. Some environmental programs of note are in the following
    areas. There is $100 million in construction funding for the Columbia
    River Fish Mitigation program in the Pacific Northwest. There is $129
    million in overall funding for the ongoing effort in south Florida to
    restore, preserve and protect the Everglades. We have also budgeted $14
    million to fund our ongoing environmental restoration continuing
    authorities programs (Section 204, the Beneficial Uses of Dredged
    Materials program, Section 206, the Aquatic Ecosystem Restoration
    program, and Section 1135 Project Modifications for Improvements of the
    Environment). This funding will allow us to implement projects to
    create and restore aquatic habitats and to modify Civil Works projects
    to improve the environment.
        The Formerly Utilized Sites Remedial Action Program, FUSRAP, is an
    environmental 6 cleanup program that was transferred by Congress from
    the Department of Energy to the Army Civil Works program in the fiscal
    year 1998 Appropriations Act. We are continuing the smooth
    implementation of needed clean-up of contaminated sites, with no
    slippage of the program during the transition from DOE to the Civil
    Works program. In fact, we have exceeded the DOE schedules for the
    Middlesex, Maywood, and Wayne sites in New Jersey, and surpassed DOE's
    planned quantities of soil removed and disposed. This year's budget
    includes $150 million for this program, an increase of $10 million over
    the past two years. This will help improve the rate of cleanup for the
    sites.
                                new investments
        The fiscal year 2000 Budget for the Army Civil Works program
    provides a strong program of new work. Details are presented in Table
    B.
        Our program of new work includes one new survey and 19 new
    construction projects, 5 new operation and maintenance new starts, and
    6 new Plant Replacement and Improvement Program (PRIP) major
    acquisitions, and the Challenge 21 program.
        The Budget includes $80 million in fiscal year 2000 for the new
    investments in the construction account, including $55 million for new
    construction starts and $25 million for Challenge 21. Capital costs for
    these new investments total $1.8 billion. Of that, $1.3 billion will be
    provided by the federal government. The balance, covering costs of
    lands, easements, rights-of-way, and relocations, will be financed
    directly by non-federal sponsors.
        The 19 new construction projects include:
      --5 for commercial navigation,
      --3 for flood damage reduction,
      --2 for environmental restoration,
      --7 for major rehabilitation, and
      --2 for dam safety assurance.
             highlights of the fiscal year 2000 continuing program
                       operation and maintenance, general
        The fiscal year 2000 Budget for the Civil Works Operation and
    Maintenance, General (O&M) Program is $1.84 billion. This level of
    funding is very strong, demonstrating the Administration's commitment
    to maintaining our existing infrastructure, much of which is aging and
    requires greater upkeep. Of the $1.84 billion, $693 million would be
    for port 7 and harbor activities, derived from the proposed HSF,
    including $75 million to maintain small boat harbors, important to the
    economies of local communities. In addition, operation and maintenance
    of hydropower facilities in the Pacific Northwest will be financed by a
    transfer of approximately $107 million from the Bonneville Power
    Administration, pursuant to an agreement signed two years ago.
        The budget also provides $226 million to continue the operation and
    maintenance of recreation areas at Civil Works projects.
                             construction, general
        The fiscal year 2000 Budget for the Civil Works Construction,
    General Program is $1.24 billion, of which $1.16 billion is for the
    continuing program. Of the total, $258 million would be for port and
    harbor construction projects derived from the Harbor Services Fund,
    allowing port related projects to proceed at optimal rates. This will
    enhance the competitiveness of our Nation's ports and harbors.
        Following are highlights of the Continuing Program.
        South Florida Ecosystem Restoration.--The Everglades is an
    ecosystem of international importance. It is also one that has
    dramatically deteriorated since the turn of the century. It is very
    important that we aggressively continue the work that we have underway
    to start the process of restoring this treasure that is so important to
    the Nation. Construction funding for these projects is $110 million for
    restoration of the Everglades and South Florida Ecosystem, a major
    environmental activity to which we are strongly committed. This amount
    includes $49 million for the Central and Southern Florida project to
    continue construction work at West Palm Beach Canal, South Dade County,
    and manatee pass-through gates, as well as planning, engineering and
    design work on the Comprehensive Restoration Plan, also known as the
    ``Restudy''; $40 million to continue construction on the Kissimmee
    River Restoration project; and $21 million for critical restoration
    projects authorized under the Everglades and South Florida Ecosystem
    Restoration program.
        Pacific Northwest Salmon.--The budget includes $100 million for
    Corps construction activities associated with the Columbia River Fish
    Mitigation project at 8 Corps dams on the Columbia and Snake rivers and
    to continue the mitigation analysis which evaluates additional measures
    to increase fish survival at those dams. This includes $59 million for
    studies of surface bypass facilities, drawdown of Lower Snake
    Reservoirs, John Day drawdown and hatchery mitigation, turbine passage,
    gas abatement, adult passage, and Lower Columbia configuration.
        Montgomery Point Lock and Dam.--The budget includes $20 million for
    the Montgomery Point Lock and Dam project on the McClellan-Kerr
    Arkansas River Navigation System to continue construction of the lock
    and dam. The project is programmed to be financed entirely from the
    Construction account.
        Kentucky Lock and Dam, Kentucky.--The budget includes $7.75 million
    for the Kentucky Lock and Dam project on the Tennessee River to
    continue detailed design of the new lock and to relocate the Tennessee
    Valley Authority's power transmission towers at the project site. The
    addition of a new lock will greatly reduce delays at the existing lock
    which is too small to handle modern 15 barge tows without 2 lockages.
        Olmsted Locks and Dam, Illinois and Kentucky.--The budget includes
    $28.6 million to continue construction of 2 new locks on the Ohio River
    near Olmsted, Illinois , to replace Locks 52 and 53 which are over 60
    years old. Virtually all waterway traffic moving between the Ohio and
    Mississippi Rivers passes through the project area, and both of the
    existing locks have temporary lock chambers that are inefficient.
    Projected increases in waterway traffic demands in combination with the
    limited capacity of the existing locks will result in increased lockage
    delays without the new locks.
        New York and New Jersey Harbors, New York and New Jersey.--The
    budget includes $60 million for the Kill Van Kull and Newark Bay, New
    York and New Jersey, project to continue construction of the deepening
    of 5 miles of Kill Van Kull channels and 3 miles of Newark Bay channels
    from 40 to 45 feet. The deeper project will accommodate larger, fully
    loaded, more modern containerships. The budget also includes $2 million
    for the New York Harbor and Adjacent Channels, Port Jersey Channel, New
    Jersey, project. Deepening Port Jersey channel from 35 feet to 41 feet
    will accommodate larger, deeper draft, cargo ships.
        Los Angles County Drainage Area, California.--The budget includes
    $30 million for up grading the existing system, raising channel walls
    and converting the trapezoidal channel to a rectangular channel, and
    bridge modifications. These improvements would protect residential,
    commercial, and industrial properties in Long Beach by accommodating
    the increased runoff resulting from urbanization over the past 40
    years.
        Southeast Louisiana.--The budget includes $47 million to continue
    construction activities for the Southeast Louisiana project including
    Canal 3, Suburban Canal, Elmwood Canal, Railroad Canal, Whitney
    Barataria Pumping Station in Jefferson Parish, and Napoleon Avenue
    Canal, Dwyer Road Pumping Station, and Broad Street Pumping Station in
    Orleans Parish.
        Continuing Authorities Program.--The budget includes $57 million
    for a full program of continuing and new work under the 9 activities in
    the Continuing Authorities Program. This amount includes $2.5 million
    for beach erosion control projects (Section 103), $8.5 million for
    emergency streambank and shoreline protection projects (Section 14),
    $26.9 million for flood damage reduction projects (Section 205), $0.5
    million for navigation mitigation projects (Section 111), $4.5 million
    for navigation projects (Section 107), $0.1 million for snagging and
    clearing projects (Section 208), $4.5 million for aquatic ecosystem
    restoration (Section 206), $8.5 million for project modifications for
    improvement of the environment (Section 1135), and $1 million for
    beneficial uses of dredged material (Section 204).
                             general investigations
        The Budget for the Civil Works General Investigations (GI) Program
    is $135 million. While this is a lower level than usual, it is a key
    element of our plan to stabilize the Civil Works budget in the future.
    The study program feeds the pipeline of construction work. There is a
    large amount of construction work already waiting for funding--far more
    than the funds we can reasonably expect in the future. This budget cuts
    back on project study funding, in order to reduce the backlog of
    potential construction projects that are beyond our capacity to budget
    within a reasonable time frame. Once the backlog of costly projects is
    reduced, then we would be able to resume funding for studies at a
    higher level.
        We believe that cutting back on study funding on a temporary basis
    is the right thing to do for our local sponsors, who expect timely
    construction of projects, once studies are completed and the projects
    are authorized.
                               regulatory program
        The fiscal year 2000 Budget for the Civil Works Regulatory Program
    is $117 million, an increase of $11 million over the enacted level of
    fiscal year 1999 funding. This will ensure that we continue to provide
    for effective and equitable regulation of the Nation's waters,
    including wetlands. Through the Regulatory Program the Corps is
    committed to serving the public in a fair and reasonable manner while
    protecting the aquatic environment, as required by laws and
    regulations. In fiscal year 1998, the Regulatory Program authorized
    90,000 activities in writing, the most in any year, and nearly 95
    percent of all actions were authorized in less than 60 days.
        One of the goals of the Corps is to help people find solutions to
    their problems. In this program, we are proud that we not only protect
    our vital aquatic resources, but we try to 10 help people, within the
    law, to find environmentally sustainable solutions to their problems.
    This budget will ensure that this level of service is maintained and
    improved, even with an increasing volume of work. The proposed increase
    would also enable the Corps to broaden its partnerships with States and
    local communities through watershed planning efforts.
        We will also continue to pursue important initiatives as part of
    the Regulatory Program. For example, under the Regulatory Program, we
    are also active in the preparation of Special Area Management Plans
    (SAMPs) to address development in environmentally sensitive areas. With
    the amount included in the President's Budget, we will establish a full
    administrative appeals process that will allow the public to challenge
    permit decisions and jurisdiction determinations without costly, time-
    consuming litigation.
        Again this year, we are proposing a reasonable increase in the
    permit application fees for commercial applicants as a means to offset
    a portion of the costs of the Regulatory Program. We are prepared to
    work closely with this Committee and the public to ensure that any
    revisions that we may adopt are reasonable.
                                   conclusion
        In summary, the President's fiscal year 2000 budget for the Army
    Civil Works Program is a good one. It demonstrates a commitment to
    Civil Works missions, with strong support for all programs, a plan to
    solve the constitutional problem with the existing Harbor Maintenance
    Tax, an especially strong program of new construction, a firm
    commitment to maintaining existing water resource management
    infrastructure, and increased application of Civil Works Program
    expertise to environmental protection and restoration.
        Thank you Mr. Chairman; Members of the Subcommittee. This concludes
    my statement.

                                      TABLE A--DEPARTMENT OF THE ARMY--CORPS OF ENGINEERS CIVIL WORKS--FISCAL YEAR 2000 DIRECT PROGRAM--PRESIDENT'S PROGRAM FUNDING
                                                                                        [In thousands of dollars]
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                        Fund
                                              ------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Special                                   Trust                        General
                     Program                  -------------------------------------------------------------------------------------------------------------                     Trust--
                                                                          Permit                 Coastal                                                    Transfer--Bnnvll  Rivers and     Total
                                                  Harbor      Permanent  applctn.    Rcrtn.     wetlands     Harbor     Inland   Ultimate \4\  Initial \5\   Power Admnstrtn    harbors
                                               services \1\  apprprtns.  fees \2\   user fees  rstrtn \3\    mntnnc    waterway                                                cntrbtns
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    COMBINED (discretionary and mandatory):
        DEFENSE: Formerly Utilized Sites       ............  ..........  ........  ..........  ..........  ..........  ........      150,000       150,000  ................  ..........     150,000
         Remedial Action Program.............
        DOMESTIC:
            General Investigations...........  ............  ..........  ........  ..........  ..........  ..........  ........      135,000       135,000  ................      39,827     174,827
            Construction, General............      257,700   ..........  ........  ..........  ..........  ..........    55,000      927,200     1,239,900  ................     156,786   1,396,686
            Operation and Maintenance,             692,900   ..........  ........      35,700  ..........  ..........  ........    1,107,300     1,835,900        107,000          8,055   1,950,955
             General.........................
            Flood Control, Mississippi River   ............  ..........  ........  ..........  ..........  ..........  ........      280,000       280,000  ................      45,673     325,673
             and Tributaries Pro-  ject......
            Regulatory Program...............  ............  ..........     7,000  ..........  ..........  ..........  ........      117,000       117,000  ................  ..........     117,000
            General Expenses.................  ............  ..........  ........  ..........  ..........  ..........  ........      148,000       148,000  ................  ..........     148,000
            Flood Control and Coastal          ............  ..........  ........  ..........  ..........  ..........  ........  ............  ...........  ................  ..........  ..........
             Emergencies.....................
            Revolving Fund...................  ............  ..........  ........  ..........  ..........  ..........  ........  ............  ...........  ................  ..........  ..........
            Coastal Wetlands Restoration.....  ............  ..........  ........  ..........      54,180  ..........  ........  ............  ...........  ................         800      10,800
            Permanent Appropriations.........       18,576   ..........  ........  ..........  ..........  ..........  ........  ............  ...........  ................  ..........      18,576
                                              ------------------------------------------------------------------------------------------------------------------------------------------------------
        ALL..................................      950,600      18,576      7,000      35,700      54,180  ..........    55,000    2,864,500     3,905,800        107,000        251,141   4,292,517
    DISCRETIONARY............................  ............  ..........  ........  ..........  ..........  ..........  ........    2,864,500     2,864,500  ................  ..........   2,864,500
    MANDATORY................................      950,600      18,576      7,000      35,700      54,180  ..........    55,000  ............    1,041,300        107,000        251,141  1,428,017
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Proposed special fund to replace Harbor Maintenance Trust Fund.
    \2\ Proposed fees for processing permit applications, to be paid to General Fund receipt account, not available to Corps.
    \3\ Total for interagency task force; Corps' piece of $10 million is reflected under Total.
    \4\ Net direct Congressional appropriation after reimbursement from mandatory Special and Trust funds, as applicable.
    \5\ Direct Congressional appropriation. The total for all accounts comes from the General Fund, initially. Ultimately, it is reimbursed from mandatory accounts in the amount shown opposite
      Mandatory.

       TABLE B--DEPARTMENT OF THE ARMY--CORPS OF ENGINEERS CIVIL WORKS--FISCAL YEAR 2000 DIRECT PROGRAM--PRESIDENT'S NEW STARTS AND OTHER NEW WORK PROGRAM
                                                                             FUNDING
                                                                     [Dollars in thousands]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                     FUNDING
                                                   ---------------------------------------------------------------------------------------------------------
                                                                         First cost                                          Budget year
               ACCOUNT/CATEGORY             Number ---------------------------------------------------------------------------------------------------------
                                                                          Federa;                                              Federa;
                                                       Total   ----------------------------- Nonfederal     Total   ----------------------------- Nonfederal
                                                                    GF      HSF     IWTF                                 GF      HSF     IWTF
    --------------------------------------------------------------------------------------------------------------------------------------------------------
            GENERAL INVESTIGATIONS

    Surveys: Santa Inez River, CA........        1        $100        $100  ...  ..........  ..........        $100        $100  ...  ..........  ..........

            CONSTRUCTION, GENERAL

    Projects:
        Regular:
            Environmental:
                Cheyenne River Sioux             1     108,000     108,000  ...  ..........  ..........       2,000       2,000  ...  ..........  ..........
                 Tribe, Lower Brule
                 Sioux, ND...............
                Willamette River                 1      70,600      70,600  ...  ..........  ..........       1,700       1,700  ...  ..........  ..........
                 Temperature Control, OR.
            Flood Protection:
                Arecibo River, PR........        1      23,100      12,500  ...  ..........     $10,600       8,742       2,500  ...  ..........      $6,242
                Grand Forks, ND--East            1     350,250     175,900  ...  ..........     174,350      30,600      10,000  ...  ..........      20,600
                 Grand Forks, MN.........
                Napa River, CA...........        1     182,000      91,000  ...  ..........      91,000      42,528       4,500  ...  ..........      38,028
            Navigation:
                Baltimore Harbor and             1      14,035      10,530  ...  ..........       3,505      13,083       9,578  ...  ..........       3,505
                 Channels, MD, Brewerton
                 Channel.................
                Kikiaola Small Boat              1       5,653       4,997  ...  ..........         656         185          75  ...  ..........         110
                 Harbor, Kauai, HI.......
                Neches River and                 1      55,860      41,895  ...  ..........      13,965       5,661       2,000  ...  ..........       3,661
                 Tributaries Saltwater
                 Barrier, TX.............
                Port Fourchon, LA........        1       4,930       2,557  ...  ..........       2,373       4,557       2,184  ...  ..........       2,373
                Santa Barbara Harbor, CA.        1       6,700       5,360  ...  ..........       1,340       6,300       4,960  ...  ..........       1,340
                                          ------------------------------------------------------------------------------------------------------------------
                  All (Regular Projects).       10     821,128     523,339  ...  ..........     297,789     115,356      39,497  ...  ..........      75,859
        Major Rehabilitation:
            Cape Cod Canal Railroad              1      30,500      30,500  ...  ..........  ..........       5,000       5,000  ...  ..........  ..........
             Bridge, MA..................
            John H. Kerr Powerhouse, VA &        1      59,600      59,600  ...  ..........  ..........       1,400       1,400  ...  ..........  ..........
             NC..........................
            Lock and Dam 12, Mississippi         1      15,500       7,750  ...      $7,750  ..........       2,600       1,300  ...      $1,300  ..........
             River, IA...................
            Lock and Dam 24, Part 2,             1      38,400      19,200  ...      19,200  ..........       1,200         600  ...         600  ..........
             Mississippi River, IL & MO..
            London Locks and Dam, Kanawha        1      20,300      10,150  ...      10,150  ..........         600  ..........  ...         600  ..........
             River, WV...................
            Patoka Lake, IN..............        1       7,200       7,200  ...  ..........  ..........       2,000       2,000  ...  ..........  ..........
            Walter F. George Powerhouse          1      37,000      37,000  ...  ..........  ..........         750         750  ...  ..........  ..........
             and Dam, AL & GA............
                                          ------------------------------------------------------------------------------------------------------------------
              All (Major Rehabilitation          7     208,500     171,400  ...      37,100  ..........      13,550      11,050  ...       2,500  ..........
               Projects).................
        Dam Safety Assurance:
            Bluestone Lake, WV...........        1     107,300     107,300  ...  ..........  ..........         750         750  ...  ..........  ..........
            Success Dam, CA..............        1      30,900      30,900  ...  ..........  ..........       1,250       1,250  ...  ..........  ..........
                                          ------------------------------------------------------------------------------------------------------------------
              All (Dam Safety Assurance          2     138,200     138,200  ...  ..........  ..........       2,000       2,000  ...  ..........  ..........
               Projects).................
                                          ------------------------------------------------------------------------------------------------------------------
              All (Projects).............       19   1,167,828     832,939  ...      37,100     297,789     130,906      52,547  ...       2,500      75,859
        Program: Riverine Ecosystem              1     654,000     425,000  ...  ..........     229,000      35,000      25,000  ...  ..........      10,000
         Restoration and Flood Hazard
         Mitigation Program..............
                                          ------------------------------------------------------------------------------------------------------------------
          All (Projects and Program).....       20   1,821,828   1,257,939  ...      37,100     526,789     165,906      77,547  ...       2,500      85,859

      OPERATION AND MAINTENANCE, GENERAL
    Dredge Wheeler Ready Reserve \1\.....        1  ..........  ..........  ...  ..........  ..........      12,450      12,450  ...  ..........  ..........
    Management Tools for Operation and           1       2,265       2,265  ...  ..........  ..........         975         975  ...  ..........  ..........
     Management..........................
    National Dam Security Program \1\....        1  ..........  ..........  ...  ..........  ..........          20          20  ...  ..........  ..........
    Wetlands Functional Assessment               1       7,398       7,398  ...  ..........  ..........       1,000       1,000  ...  ..........  ..........
     Methodology.........................
    Zebra Mussel Research Program........        1      13,378      13,378  ...  ..........  ..........       1,500       1,500  ...  ..........  ..........
                                          ------------------------------------------------------------------------------------------------------------------
          All (Remaining Items)..........        5      23,041      23,041  ...  ..........  ..........      15,945      15,945  ...  ..........  ..........

                REVOLVING FUND

    Plant Replacement and Improvement
     Program (PRIP) Major Acquisitions
     \2\
        Towboat RAYMOND C. PECK                  1       5,500       5,500  ...  ..........  ..........       5,160       5,160  ...  ..........  ..........
         Replacement.....................
        Fuel Oil Barge Replacement.......        1       1,495       1,495  ...  ..........  ..........       1,390       1,390  ...  ..........  ..........
        Survey Boat GRANADA Replacement..        1       1,533       1,533  ...  ..........  ..........       1,285       1,285  ...  ..........  ..........
        Derrickboat NO. 6 Replacement....        1         775         775  ...  ..........  ..........         660         660  ...  ..........  ..........
        PANAMA CITY Crane Barge                  1       6,400       6,400  ...  ..........  ..........         125         125  ...  ..........  ..........
         Replacement.....................
        Survey Boat GATLIN Replacement...        1       1,800       1,800  ...  ..........  ..........       1,550       1,550  ...  ..........  ..........
                                          ------------------------------------------------------------------------------------------------------------------
          All (PRIP Major Acquisitions)..        6      17,503      17,503  ...  ..........  ..........      10,170      10,170  ...  ..........  ..........
                                          ------------------------------------------------------------------------------------------------------------------
          ALL............................       32   1,862,472   1,298,583  ...      37,100     526,789     192,121     103,762  ...       2,500     85,859
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Fiscal year 2000 funding reflects annual requirement.
    \2\ Funding is available from the Revolving Fund.

       TABLE C--DEPARTMENT OF THE ARMY--CORPS OF ENGINEERS CIVIL WORKS--FISCAL YEAR 2000 TOTAL (DIRECT AND REIMBURSED) PROGRAM--PRESIDENT'S ENVIRONMENTAL
                                                                         PROGRAM FUNDING
                                                                    [In thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                 Fiscal year
                                                ------------------------------------------------------------------------------------------------------------
                      Category                                    Appropriation                                       Budget 2000 account
                                                ------------------------------------------------------------------------------------------------------------
                                                    1996        1997         1998        1999         All         GI          C,G        O&M,G      Others
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    DIRECT PROGRAM:
        DISCRETIONARY PROGRAM:
            STUDY AND PROJECT SPECIFIC
             ACTIVITIES:
                MITIGATION.....................     156,010     177,515      128,933     156,840     148,769       3,887     141,516  ..........       3,366
                RESTORATION....................     105,752      74,031      181,516      82,289     138,940      15,584      97,154      10,702      15,500
                PROTECTION.....................      79,450      90,594      126,875      81,852      86,319         459       3,909      74,044       7,907
                CLEANUP........................      12,020       3,458          317         540  ..........  ..........  ..........  ..........  ..........
                COMPLIANCE.....................       9,864         360          395       2,480       1,327         304         468  ..........         555
                                                ------------------------------------------------------------------------------------------------------------
                  ALL (Study and Project            363,096     345,958      438,036     324,001     375,355      20,234     243,047      84,746      27,328
                   Specific Activities)........
            PROGRAMMATIC ACTIVITIES:
                1AQUATIC PLANT CONTROL.........       4,000       2,000        5,000       3,000       3,000  ..........       3,000  ..........  ..........
                AQUATIC ECOSYSTEM RESTORATION    ..........  ..........        6,000      11,200       4,500  ..........       4,500  ..........  ..........
                 (SEC 206).....................
                BENEFICIAL USES OF DREDGED            2,500       1,500        2,000         350       1,000  ..........       1,000  ..........  ..........
                 MATERIAL (SEC 204)............
                DREDGING OPERATIONS AND          ..........       1,500        4,000       5,000       8,000  ..........  ..........       8,000  ..........
                 ENVIRONMENTAL RESEARCH (DOER).
                ENVIRONMENTAL DATA STUDIES.....  ..........         100          100         100         100         100  ..........  ..........  ..........
                ENVIRONMENTAL INFRASTRUCTURE...  ..........  ..........        5,000  ..........  ..........  ..........  ..........  ..........  ..........
                ENVIRONMENTAL REVIEW GUIDE FOR   ..........  ..........  ...........  ..........  ..........  ..........  ..........  ..........  ..........
                 OPERATIONS (ERGO).............
                FORMERLY UTILIZED SIRTES         ..........  ..........  \1\ 162,718     140,000     150,000  ..........  ..........  ..........     150,000
                 REMEDIAL ACTION PROGRAM
                 (FUSRAP)......................
                GREAT LAKES REMEDIAL ACTION             500         500          500         500  ..........  ..........  ..........  ..........  ..........
                 PROGRAM (SEC 401).............
                HAZARDOUS WASTE SITE                  3,500  ..........  ...........  ..........  ..........  ..........  ..........  ..........  ..........
                 RESTORATION INITIATIVE........
                NATIONAL RECREATION MANAGEMENT   ..........  ..........  ...........       1,000  ..........  ..........  ..........  ..........  ..........
                 SUPPORT (NRMS)................
                NATURAL RESOURCES TECHNICAL      ..........  ..........          700  ..........  ..........  ..........  ..........  ..........  ..........
                 SUPPORT (NRTS)................
                OIL SPILL RESEARCH PROGRAM.....         850  ..........  ...........  ..........  ..........  ..........  ..........  ..........  ..........
                POLLUTION PREVENTION PROGRAM...       5,000  ..........  ...........  ..........  ..........  ..........  ..........  ..........  ..........
                PROJECT MODIFICATION FOR             10,850      17,000       21,175      11,000       8,500  ..........       8,500  ..........  ..........
                 IMPROVEMENT OF THE ENVIRONMENT
                 (SEC 1135)....................
                REGULATORY PROGRAM.............     101,000     101,000      106,000     106,000     117,000  ..........  ..........  ..........     117,000
                RESEARCH AND DEVELOPMENT.......       8,331      10,399       17,450      19,450      18,000       4,500       3,000      10,500  ..........
                RIVERINE ECOSYSTEM RESTORATION   ..........  ..........  ...........  ..........      25,000  ..........      25,000  ..........  ..........
                 AND FLOOD HAZARD MITIGATION...
                WETLAND AND AQUATIC HABITAT           2,500  ..........  ...........  ..........  ..........  ..........  ..........  ..........  ..........
                 CREATION......................
                WETLANDS FUNCTIONAL ASSESSMENT   ..........  ..........  ...........  ..........       1,000  ..........  ..........       1,000  ..........
                 METHODOLOGY...................
                ZEBRA MUSSEL RESEARCH PROGRAM..  ..........  ..........  ...........       1,500       1,500  ..........  ..........       1,500  ..........
                                                ------------------------------------------------------------------------------------------------------------
                  ALL (Programmatic Activities)     135,031     131,999      325,643     296,100     334,600       4,600      42,000      21,000     267,000
                                                ------------------------------------------------------------------------------------------------------------
                  ALL (Study and Project            498,127     477,957      763,679     620,101     709,955      24,834     285,047     105,746     294,328
                   Specific and Programmatic
                   Activities).................
        MANDATORY PROGRAM: COASTAL WETLANDS          35,000      43,000       44,000      10,000      10,000  ..........  ..........  ..........      10,000
         PLANNING, PROTECTION, AND RESTORATION.
                                                ------------------------------------------------------------------------------------------------------------
          ALL (Discretionary and Mandatory          533,127     520,957      807,679     630,101     719,955      24,834     285,047     105,746     304,328
           Programs)...........................
    REIMBURSED PROGRAM (SUPPORT FOR OTHERS):
        EPA SUPERFUND..........................     250,000     250,000      300,000     250,000     250,000  ..........  ..........  ..........     250,000
        DEPARTMENT OF ENERGY...................      31,000      20,000       22,000       2,000  ..........  ..........  ..........  ..........
        OTHER GOVERNMENTAL AGENCIES............      65,000      45,000       35,000      11,000       8,000  ..........  ..........  ..........       8,000
                                                ------------------------------------------------------------------------------------------------------------
          ALL (Reimbursed Program).............     346,000     315,000      357,000     263,000     258,000  ..........  ..........  ..........     258,000
          ALL (Direct and Reimbursed Programs).     879,127     835,957    1,164,679     893,101     977,955      24,834     285,047     105,746    562,328
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Includes $22,718 in unpaid balance transferred from Department of Energy.

                          statement of joe n. ballard

        Senator Domenici. Thank you very much, Mr. Secretary.
        With the committee's indulgence, we will have General
    Ballard testify, and then we will inquire. General Ballard, it
    is nice to have you here.
        General Ballard. Thank you very much, Mr. Chairman and
    members of the subcommittee. I am pleased to be testifying on
    the President's fiscal year 2000 budget for the civil works
    program. I am again honored to be appearing before you again as
    Chief of Engineers.
        Today the Corps' civil works program is strong and highly
    productive, and I thank you for your great support for this
    critical program that is really an investment in our Nation's
    future. This budget request is, I believe, more constructive
    than the one presented a year ago, setting the stage for an
    effective dialogue with the Congress on appropriate funding
    levels.
        Mr. Chairman, with your permission, I will now summarize my
    complete statement and submit that statement for the record. My
    summary covers four topics: transformation of the Corps, the
    civil works program execution, the FUSRAP program, and some
    selected civil works issues.
        Mr. Chairman, I would like to begin with a short discussion
    of what is happening inside of the Corps. We are very proud of
    what we have accomplished, and there is still much more to
    come. Several years ago, we developed a vision and a strategic
    management process. Our intent was to transform the Corps into
    an organization ready to take on the challenges of the 21st
    century.
        In the last 2 years, we have----
        Senator Domenici. General, could you excuse me just one
    moment?
        General Ballard. Yes.
        Senator Domenici. Would one of you take my place while I go
    to the Commerce, Justice appropriations? Senator Bennett, would
    you chair? I will be back shortly.
        Senator Bennett. Yes.
        Senator Domenici. Thank you very much.
        Thank you, General.
        General Ballard. Yes, sir.

                       efficiency and responsive measures

        I will continue, sir. In the last 2 years, we have worked
    diligently to become more client focused, dramatically changing
    our internal processes to become more responsive and cost
    efficient, and to take advantage of changes in technology. Now,
    a lot of time and energy was invested up front, and we are now
    beginning to see the payoff. Time does not permit me to get
    into very much depth, but I would like to give you a few
    snapshots of our progress.

                               project management

        In the area of project management, we have fully
    implemented the project management concept providing our
    clients one point of contact and responsibility for Corps
    projects and programs. This has greatly enhanced our
    relationship with our clients, and at the same time, it
    integrated the resources of the organization to focus on
    quality projects delivered on time and within budget.
        In the past, we forced our customers to understand our
    internal organization and navigate the different stovepipes,
    doing their own coordination. Now our customers will go to
    their supporting districts who have the responsibility to
    deliver whatever is needed, accomplishing all coordination and
    integration seamlessly and transparently.
        We are relooking our entire planning process from the time
    a project is identified until the project cost-sharing
    agreement is signed. This area has been particularly
    frustrating for our clients and for us. The process simply
    takes too long. It is too bureaucratic and too costly. We have
    approved for implementation the recommendation of a process
    action team to streamline the process, to minimize the burden
    on local sponsors, and delegate most of the approval and
    execution authority to divisions and districts, thus expediting
    agreements. We have also made significant changes to our
    continuing authorities program to simplify, expedite, and make
    it more user friendly. And these efforts are only the
    beginning.
        We are reevaluating our organization at every level. Over
    the past few years, our General Expense staffing has declined
    from 1,368 in fiscal year 1996 to 1,181 in fiscal year 1999.
    Now, that is a 14-percent reduction at the same time we have
    had an increase in workload. As you know, we have reduced the
    number of divisions from 11 to 8 and continue our downsizing of
    division staffs. We are also reducing headquarters staffing. By
    Washington standards, we were already a lean headquarters
    before we started this process, at less than 2 percent of the
    total work force.
        I could go on about changes inside of the Corps. I hope
    that this will give you some insight into a much larger process
    that will continue to accelerate over the next few years.
        Now, let me turn now to some ongoing execution of our civil
    works program.

                               program execution

        Efficient and responsive execution continue to be a very
    important priority of the Secretary and mine. In fiscal year
    1998, we increased our expenditure execution by $400 million
    over what has been a flat execution of about $3.7 billion for
    each of the preceding 3 years. In fiscal year 1999, we have
    scheduled an additional $500 million in expenditures, meaning
    that we will have increased the Corps' capacity by $900 million
    in just 2 years, while maintaining the quality and the
    professional standards that have marked our work for many
    years.
        But in spite of that record, I am not yet satisfied with
    our execution rate. We will continue to examine and evaluate
    ways to expedite our projects from start to finish.

                                 fusrap program

        I would like to report on our progress in the FUSRAP
    program. We have accomplished our first two priorities in the
    FUSRAP program, following transfer of execution from the
    Department of Energy. We have maintained the anticipated
    schedule during the transition period and have put a number of
    cost saving measures in place.
        In fiscal year 1999, we expect to complete remedial action
    at 2 sites and to accomplish work on schedule for 19 other
    sites.
        The highest priority actions are those to remove potential
    risks to the health of the environment. Budget funding will
    enable completion of remedial action at 3 sites and continued
    work at 16 others. At the current rate of funding, we should
    complete all of our sites by the year 2010. This program is a
    real success story. I am very proud of our contribution to the
    Nation and our track record on this program.
        As in any large and complex program, there are a few areas
    that need some attention, so let me highlight a few that may be
    of some interest.

                               regulatory program

        In the regulatory funding and appeals, this is an area that
    we are really struggling with. Our funding level to date has
    only been enough to provide the most basic level of permit
    review and response to the public. Trying to meet your intent,
    we are implementing a limited appeals process this year. The
    proposed funding level for next year will permit us to
    implement the complete regulatory appeals process.

                       operation and maintenance program

        In the area of operation and maintenance, the O&M level of
    funding proposed for this year is for the first time adequate
    to meet our current O&M needs. However, we have a large backlog
    of maintenance and repair for our infrastructure. During this
    year, O&M will be an area of significant focus for us. We will
    look at every single area for ways to reduce our operating
    costs, accomplish needed maintenance and repair and improve our
    services.

                            general expense account

        On the subject of GE funding, earlier in my statement I
    extolled our progress in reducing division and headquarters
    staff. We have made great progress in this area, but I do not
    believe we can go any lower. Since 1991, we have reduced GE
    staffing levels by almost 33 percent. I am convinced that we
    must hold at the current staffing level to provide for program
    direction and oversight, for which you and the public rely on
    us.
        Mr. Chairman, in conclusion, the President's budget for the
    Corps of Engineers is a good one. Using our strategic
    management process, we will continue to find ways to reduce our
    costs and improve our level of responsiveness to the public and
    our clients. Meanwhile, we will do our very best to execute the
    civil works program for maximum benefit to the Nation.

                               prepared statement

        Thank you, Mr. Chairman and members of the committee. This
    concludes our statement, and we are now ready to take your
    questions.
        [The statement follows:]

                      Prepared Statement of Joe N. Ballard

                                  introduction
        I am pleased to be testifying on the President's fiscal year 2000
    (fiscal year 2000) Budget for the Civil Works Program, and am honored
    to be appearing before you again as Chief of Engineers.
        Today, the Civil Works Program is strong, balanced, and highly
    productive. I look forward to your continued partnership in this fine
    program, so broadly beneficial to our Nation.
        My statement covers seven topics:
      --Fiscal year 2000 Civil Works Program Budget,
      --Program Execution and Outlook,
      --Restructuring,
      --Improvement of Business Operations,
      --Corps of Engineers Financial Management System,
      --Corps Vision, and
      --Headquarters Relocation Planning.
                  fiscal year 2000 civil works program budget
                                  introduction
        This is a good budget. New fiscal year 2000 funding for the Civil
    Works Program, including the Direct and Reimbursed programs, is
    expected to approach $5.10 billion.
        The Direct Program is formulated by the federal government and
    funded through appropriations of discretionary and mandatory amounts
    directly to the Corps. Funding for this program totals $4.29 billion.
    Discretionary amounts total $3.91 billion, including defense and
    domestic program components of $150 million and $3.76 billion,
    respectively. The defense component is for the Formerly Utilized Sites
    Remedial Action Program (FUSRAP), transferred from the Department of
    Energy to the Corps by Congress in the Energy and Water Development
    Appropriations Act, 1998.
        The Reimbursed Program is formulated, under provisions of law, by
    the Corps in collaboration with other federal agencies, State and local
    governments, and other nations. It is funded in either of two ways:
    from discretionary amounts of the Direct Program, initially, and,
    ultimately, through reimbursement by the ordering agencies,
    governments, and nations; or by advance payments by the agencies,
    governments, and nations. Funding for this program is projected to be
    $800 million.
        Direct Program
                                    overview
        The proposed fiscal year 2000 Civil Works Direct Program budget
    reflects the Administration's commitment to continued sound development
    and management of the Nation's water resources, to which the Corps has
    been dedicated for over 200 years. It provides for continued efficient
    operation of the Nation's navigation, flood protection, and other water
    resource management infrastructure, fair regulation of the Nation's
    wetlands, and restoration of the Nation's important environmental
    resources, such as the Florida Everglades. It provides for initiation
    of a new program to restore riverine ecosystems while mitigating flood
    hazards for communities. Additionally, it is supported by a proposal to
    establish a Harbor Services User Fee (HSUF) and Harbor Services Fund
    (HSF) to fund the federal share of construction cost, as well as
    operation and maintenance of our harbors and ports. Lastly, it is
    consistent with the President's overall domestic priorities and
    continued commitment to a balanced budget. The budget provides for
    continued funding of nearly all studies and projects underway,
    including many started in fiscal year 1999. It also provides for
    funding of new starts under the General Investigations (GI),
    Construction, General, (CG), and Operation and Maintenance, General
    (O&M) programs, and the Plant Replacement and Improvement Program
    (PRIP) of the Revolving Fund.
        The new start program includes 1 new reconnaissance study.
    Additionally, 27 preconstruction engineering and design studies,
    following cost-shared feasibility studies, are being funded for the
    first time.
        The new start program also includes new construction projects and
    one new program. The projects include 19 specifically authorized by
    Congress and an undetermined number generally authorized under the
    Continuing Authorities Program (CAP). The specifically authorized
    projects include 10 regular construction projects, 7 major
    rehabilitation projects, and 2 dam safety assurance projects. The
    regular construction projects include 5 for navigation, 3 for flood
    control, and 2 for environmental improvement. The new program is the
    Riverine Ecosystem Restoration and Flood Hazard Mitigation Program,
    also known as ``Challenge 21.''
        Additionally, the new start program includes 5 new operation and
    maintenance items and 6 new PRIP major acquisitions construction
    projects.
                                  new funding
        As shown in the table at the end of this statement, the fiscal year
    2000 budget includes $3.91 billion in ``Discretionary and Related
    Mandatory'' funding being requested through the fiscal year 2000 Energy
    and Water Development Appropriations Act. All amounts shown under this
    heading are appropriated from the General Fund; however, amounts shown
    under the CG and O&M accounts opposite the names of other funds are
    ultimately reimbursed from those other funds. Accordingly, $1.04
    billion, or 27 percent, of the amount requested would be offset with
    dedicated funding from the HSF ($951 million), Inland Waterway Trust
    Fund (IWTF) ($55 million), and Special Recreation User Fees (SRUF) Fund
    ($36 million). Funding for the GI, CG, and Flood Control, Mississippi
    River and Tributaries (FC, MR&T) Programs, in which new study and
    construction starts are common, totals $1.65 billion. Of this, $80
    million, or 5.0 percent, is provided to fund the new study and
    construction starts mentioned above, including Challenge 21.
        In addition, as shown in the table, the budget includes $387
    million in ``Mandatory, Only,'' funding to be made available under
    existing law. This includes $251 million from the Rivers and Harbors
    Contributions Trust Fund (R&HCTF), representing nonfederal costsharing
    contributions paid under 5 programs (the GI; CG; O&M; FC,MR&T Project;
    4 and CWPPR Project programs). It also includes $107 million to be
    transferred from the Bonneville Power Administration (BPA) for
    operation and maintenance of the Corps' hydropower generation
    facilities in the Pacific Northwest.
    Comparison with Fiscal Year 1999 Funding
        As shown in the table, new direct funding for the fiscal year 2000
    budget is $83 million less than initial appropriations for fiscal year
    1999.
        Discretionary and related mandatory funding is $54 million less
    than, or 99 percent of, last year's initial appropriations. It was
    increased for three accounts, unchanged for two, and decreased for
    three others. Accounts increased include FUSRAP (107 percent), O&M (111
    percent), and the Regulatory Program (110 percent); unchanged include
    GE and FC&CE; and decreased include GI (83 percent), CG (87 percent),
    and FC,MR&T (87 percent).
        New mandatory, only, funding is $28 million less than, or 93
    percent of, last year's appropriations, largely because of decreased
    R&HCTF costsharing contributions.
        Outlays of discretionary funding for fiscal year 2000 are expected
    to be about $218 million less than for fiscal year 1999, commensurate
    with the reduction in funding.
    Net New Funding
        Of the $4.29 billion in total new direct funding, $1.43 billion, or
    33 percent, would come from 9 sources other than Treasury's General
    Fund, yielding net new funding not specifically collected for the
    program of $2.96 billion. These sources--8 existing and 1 proposed--
    include 5 special and 3 trust funds, and 1 transfer. The largest
    amounts would come from the proposed HSF ($951 million, including $258
    million for the CG and $693 million for the O&M programs). Sizeable
    amounts would also come from the IWTF ($55 million) and SRUF Fund ($36
    million). The balance of $387 million would come from the 6 mandatory,
    only, sources.
        We are also proposing changes to the fees collected under the
    Regulatory Program. These fees would be transferred to a General Fund
    receipt account and would be unavailable to the Corps. The collections
    are now projected to be $7 million in fiscal year 2000 and, annually,
    thereafter. We have scaled back this initiative considerably, and
    anticipate collecting only about half as much as we had proposed
    previously. Although unavailable to the Corps for its use, the
    collections would reduce net federal costs.
    Highlights
        The budget provides for essentially ``flat'' annual funding for the
    5-year program at the fiscal year 2000 level, which is 99 percent of
    fiscal year 1999 initial appropriations. Moreover, it provides
    essentially flat annual funding by individual program for the 5-year
    program. Generally, work completion schedules will be shortened
    somewhat from those presented last year. A notable exception is that
    schedules of the GI Program will be lengthened somewhat.
        Proposed funding for the GI Program is 90 percent of fiscal year
    1999 budgeted funding. The rationale for this is that studies lead to
    construction projects of which there is already a large backlog due to
    competing funding priorities. Given outyear funding ceilings based on
    these priorities, reduction of this large backlog will be possible only
    over several years. In light of this, limiting the number of new start
    studies and setting priorities among ongoing ones appears advisable,
    for the time being. However, in that programmatic activities such as
    floodplain management, planning assistance, and international water
    studies provide important grass-roots support to local communities in
    solving their water resource problems, they were funded at
    approximately fiscal year 1999 appropriation levels.
        The proposed HSF will replace the Harbor Maintenance Trust Fund
    (HMTF). The HMTF was funded with an ad valorem tax on freight shipped
    through the Nation's harbors and ports. This tax was determined to be
    unconstitutional, as applied to exports, by the U. S. Supreme Court.
    The HSF will be funded with fees collected from commercial users of the
    harbors and ports, the rationale being that beneficiaries should be
    responsible for costs. The fees will be based on the values of benefits
    that users receive from services provided, and will be sufficient to
    cover federal costs of harbor and port construction, operation, and
    maintenance. The rates of the fees will vary based on types and
    carrying capacities of vessels involved. The proposal will enable
    nearly all construction, operation, and maintenance of harbors and
    ports to proceed on optimal schedules.
        Proposed fiscal year 2000 funding for the CG Program is 154 percent
    of fiscal year 1999 budgeted funding. Much of the increase is due to
    dedicated funding from the proposed new HSF. This dedicated funding
    covers 100 percent of costs of harbor and port construction. Because of
    this, completion schedules for 28 harbor and port development projects
    have been optimized. This will enable accomplishing more work sooner,
    thereby producing navigation benefits and resultant cost savings
    sooner. In addition, completion schedules for 9 high priority projects
    for mitigation, ecosystem restoration, and other purposes have been
    optimized. On the other hand, completion schedules for flood damage
    reduction, inland waterway, and shore protection projects are somewhat
    constrained.
        Proposed fiscal year 2000 funding for the O&M Program is 115
    percent of fiscal year 1999 budgeted funding. All 6 of this increase is
    due to dedicated funding from the HSF which will cover 100 percent of
    costs of harbor and port operation and maintenance. The increase in
    funding will help improve current services.
                               reimbursed program
        Through the Interagency and Intergovernmental Support Program we
    help other agencies and governments with timely, cost-effective
    implementation of their programs, while maintaining and enhancing
    capabilities for execution of our Civil Works Direct Program and
    Military Program missions. Other agencies look to us for help with
    engineering and construction management because of our vast experience
    and capabilities, enabling us to do the work better, faster, and
    cheaper.
        We provide reimbursable support for about 60 other federal agencies
    and several State and local governments through help with
    environmental, engineering, and construction management work. Total
    reimbursement for such work in fiscal year 2000 is projected to be $800
    million. The largest share--nearly $250 million--is expected from the
    Environmental Protection Agency (EPA) for cleanup of wastes at numerous
    sites under its Superfund program. 98 percent of Reimbursed Program
    funding is provided by federal agencies.
                                    staffing
        Total staffing for the Civil Works Program for fiscal year 2000 is
    24,734 FTEs. This reflects a reduction of 462 FTEs from the fiscal year
    1999 total. Of the total, 23,584 FTEs are for the Direct Program and
    1,150 FTEs are for the Reimbursed Program. Total staffing is allocated
    90.6 percent to districts, 4.9 percent to laboratories and other
    separate field operating agencies, 2.7 percent to division offices, and
    1.8 percent to headquarters.
                         program execution and outlook
                                  introduction
        Efficient and responsive execution of the program that Congress
    made appropriations for continues to be a very important priority of
    mine as Chief of Engineers. In fiscal year 1998, we increased our
    expenditure execution by $400 million over what had been a flat
    execution of about $3.7 billion for each of the preceding three years.
    In fiscal year 1999, we have 7 scheduled an additional $500 million in
    expenditures, meaning we will have increased the Corps' capacity by
    $900 million in two years concurrent with maintaining the quality and
    professional standards that have marked our work for years.
                formerly utilized sites remedial action program
        As I testified last year, we accomplished our first two priorities
    in executing FUSRAP following transfer of execution responsibilities
    from the Department of Energy. We kept the anticipated schedule during
    the transition period, and implemented numerous cost saving measures.
    We also completed our assessment of the program and provided a report
    of our finding to you.
        We are working to finalize a Memorandum of Understanding with DOE
    defining our respective roles and responsibilities, as directed by
    Congress.
        During fiscal year 1999, we expect to complete remedial action at 2
    sites and to accomplish work on schedule for 19 others.
        The President's Budget includes $150 million in new funding for
    FUSRAP, reflecting current priorities for remedial action. We are
    giving highest priority to proceeding in a way that will reduce
    potential risks to health and the environment. To improve the overall
    efficiency of the program, we also have assigned a priority to
    activities and sites that can be completed in the short-term--within
    the next fiscal year or two. Budget funding will enable completion of
    remedial action at 3 sites and continuing work at 16 others.
        I am very proud of our contribution to the Nation as a result of
    our effort on this program.
                             general investigations
        Scheduled report production for the program in fiscal year 1998
    included 83 reconnaissance and 26 feasibility reports. We completed 78
    and 28, respectively.
        The National Research Council recently completed an independent
    assessment of our Civil Works project development process. While
    concluding that the overall length and cost of the planning process are
    reasonable in light of the many considerations involved, the
    preliminary report includes some recommendations in the interest of
    shortening it. These recommendations include that we seek conditional
    authorizations 8 and reduce gaps between work phases. Additional
    recommendations include our using a watershed or estuarial region as
    the basic planning unit, studying a sample of flood control projects to
    evaluate whether non-structural alternatives have been adequately
    considered, and revising the Principles and Guidelines to incorporate
    contemporary analytical techniques and public values. Presently, we are
    evaluating these recommendations.
        The President's Budget includes $135 million in new funding for the
    GI Program, including $100 thousand for one new start reconnaissance
    study. The outlook for program workload is healthy. We are striving
    continually to enhance our performance during these times of limited
    resources.
                             construction, general
        In fiscal year 1998, we scheduled CG Program expenditures totaling
    $1.3 billion, and actually expended $1.24 billion.
        In fiscal year 1999, $1.54 billion is scheduled for expenditure.
    Our districts and divisions are aggressively seeking opportunities to
    accomplish work on funded projects. At the end of January, expenditures
    were on schedule at $342 million. Typically, once Spring arrives and
    construction operations come up to speed nationwide, the rate of
    expenditure will begin a steady climb that continues through the end of
    the fiscal year.
        The President's Budget includes $1.24 billion in new funding for
    the CG Program. Included in this amount is $80 million for initiation
    of 19 new start projects and one new program initiative for Riverine
    Ecosystem Restoration and Flood Hazard Mitigation. The balance of $1.16
    billion includes $1.04 billion for specifically authorized continuing
    projects and $125 million for remaining items, including projects under
    several continuing authorities programs.
        Over 25 percent of the budget request will be offset by $313
    million in dedicated funding from the proposed HSF ($258 million) and
    the IWTF ($55 million).
                      operation and maintenance, general:
        The O&M Program covers operation and maintenance of the Corps'
    water resource management infrastructure. More specifically, the
    program provides for operation, 9 including monitoring and study, and
    maintenance, including dredging and repair, as applicable, of 25,000
    miles of waterways, 238 navigation locks, 926 harbors, 383 dams and
    reservoir projects, 75 hydroelectric power projects, and recreation
    facilities for 380 million visits per year. This infrastructure,
    benefitting navigation, flood damage reduction, hydropower generation,
    recreation and the environment, contributes significantly to the
    economic and environmental health of the Nation.
        Fiscal year 1998 funding for the program included $1.74 billion in
    initial appropriation, plus $105 million in an emergency supplemental
    appropriation for repair of Corps projects impacted by storms primarily
    in California and along the Gulf Coast. In fiscal year 1998, we
    completed consolidation of O&M fiscal management activities into our
    Programs Management Division to simplify and streamline fiscal
    operations.
        The initial fiscal year 1999 O&M appropriation was $1.65 billion.
    Also, in fiscal year 1999, for the first time, BPA began funding
    operation and maintenance of hydropower facilities in the Pacific
    Northwest directly, thereby eliminating need for Corps appropriations
    for this work. BPA will transfer $106 million to the Corps for the work
    in fiscal year 1999. Total funding for the O&M Program from these two
    sources is $1.76 billion, or 1 percent more than the initial fiscal
    year 1998 amount. In addition, the program received a $100 million
    emergency supplemental appropriation for repair of storm damage to
    navigation facilities in the Southeast and, again, along the Gulf
    Coast, particularly from Hurricane Georges.
        The President's Budget includes $1.84 billion in new funding for
    the O&M Program. In addition, BPA will provide $107 million.
    Accordingly, total initial funding is $1.94 billion, or 11 percent more
    than in fiscal year 1999. This increase will be used to maintain and
    repair our aging infrastructure. For years, because of budget
    constraints, we have deferred work not critical to project operation
    during the budget year, thereby building our backlog of desired
    maintenance work. Eventually, after repeated deferrals, facilities
    become deteriorated to the extent that repair must be done to avoid
    serious failure. We continue to search for and implement more cost-
    effective ways to accomplish our stewardship with limited resources. We
    are determined keep this infrastructure in condition to provide the
    products and services so essential to sustaining our national
    prosperity.
        Nearly 40 percent of the budget request will be offset by $729
    million in dedicated funding from the proposed HSF ($693 million) and
    the SRUF Fund ($36 million).
                                general expenses
        The General Expenses (GE) Program provides for executive direction
    and management of the Civil Works program by the headquarters and 8
    division offices. It also provides for support of executive direction
    and management by 4 field operating activities. Funding for the program
    is allocated approximately 70 percent for labor; 24 percent for fixed
    costs such as rent, utilities, communications, and contractual
    services; and 6 percent for discretionary costs, such as travel,
    training, supplies and materials.
        Together, headquarters and division offices provide executive
    direction and management for the Civil Works program. They are funded
    from appropriations for the GE Program, for which the President's
    Budget includes $148 million in new funding. This supports staffing of
    1,142 FTEs, reduced from 1,177 FTEs in fiscal year 1999. This staffing
    represents only 4.6 percent of the total Civil Works Program workforce.
    Headquarters staffing of 437 FTEs represents less than 2 percent of the
    total workforce.
        During the past 10 years, GE Program staffing has been reduced by
    one-third. It will continue to decline through fiscal year 2002 to
    about 1,050 FTEs. Despite inflation and cost increases in personnel
    compensation and benefits, we continue to look at ways to streamline
    and economize, although we may have few opportunities left. Personnel
    reductions, reorganizations, and other efficiency measures allow our
    request to remain at $148 million for the third consecutive year.
        I am keenly aware of expectations of the Committee and the American
    public that the Corps get the job done right at least cost. Executive
    direction and management under this program plays a key role in
    developing ways to meet these expectations. We appreciate your strong
    support for this program, so important to continued high performance of
    the Civil Works Program.
                                 restructuring
                                  introduction
        We continue to restructure our organization with a view to
    achieving greater efficiency and effectiveness in the resourcing,
    planning, design, and execution of our Civil Works and Military
    Programs. I would like to update you on continued progress in the
    restructuring of our organization through consolidation, streamlining,
    and downsizing of 11 our headquarters, divisions, and the emergency
    operations organization.
                                  headquarters
    Resource Management Consolidation
        Last year I achieved my goal of establishing a full-service Deputy
    Chief of Staff, Resource Management, at Corps headquarters. Before
    consolidation, resource management functions were fragmented throughout
    the headquarters. This was inefficient and diminished our ability to
    plan, program, budget and manage use of our total resources. Now, our
    financial data collection and maintenance and oversight of corporate
    resources are consolidated into the Resource Management Directorate.
    All financial and staffing data are now generated in this Directorate.
    This enables me to get integrated information on all resource matters
    of the Command.
    Staffing
        We have been reducing staffing of Corps headquarters as well as of
    the 4 field support activities. We expect that headquarters staffing
    will be about 90 percent of the fiscal year 1997 level in fiscal year
    2000, and only 81.5 percent of the fiscal year 1997 level by fiscal
    year 2002. Staffing of the 4 support activities has already been
    reduced to 83 percent of the fiscal year 1997 level, and is projected
    to be further reduced to 78.5 percent of the fiscal year 1997 level by
    fiscal year 2002.
                                   divisions
    Regional Business Centers
        In February 1998, I approved establishment of each division office
    as a Regional Business Center (RBC) with a view to getting divisions
    and their districts to operate as single business entities in the
    interest of efficiency and effectiveness. Implementation of this plan
    required dramatic changes in business style and organizational
    cultures. Our efforts at this have been very productive. This year the
    division Regional Management Boards (RMBs) have all reviewed the same
    budgeting and accounting 12 practices for the purpose of achieving
    Corps-wide consistency and standardization. The RMBs also significantly
    improved vertical and horizontal communications within their regions
    and established a Corps-wide forum for sharing lessons learned and
    enhancing the RBC concept. This year, I expect that the RMBs will
    identify optimal business practices for the region, most efficient
    organizations for each district, and initiatives to maximize the use of
    regional resources.
    Resource Management Consolidation
        Management of corporate resources within one office at all levels
    is critical to efficient, effective, full-service operations.
    Accordingly, in November 1998, I directed divisions to consolidate all
    facets of operations regarding resources within their Resource
    Management Offices, much as we have done at headquarters. Consolidation
    is now complete.
    Staffing
        As reported last year we have completed restructuring our
    divisions, from 11 to 8, to provide a more efficient and effective
    organization. We expect that staffing for the 8 divisions will be about
    84 percent of the fiscal year 1997 level in fiscal year 2000, and about
    77 percent of the fiscal year 1997 level by fiscal year 2002.
                       emergency operations organization
        In July 1997, we began implementation of our ``Readiness 2000
    Initiative'' to transform our readiness group into a corporate team
    sharing planning responsibilities and response capabilities, and to
    organize and manage emergency operations resources through a national
    strategy. The goal is to provide for rapid set-up of effective response
    organizations and immediate initiation of emergency contracting and
    other critical services for impacted communities. The program provides
    for establishing and training teams in each of our 37 districts for 46
    specific emergency response missions, and supporting these teams with a
    ``deployable tactical operations system'' (DTOS), including 24
    vehicles, 2 transportable systems, and 37 ``fly away'' equipment
    packages.
        To date, we have established all 46 teams and formally trained 24
    of them. We have 13 also purchased roughly 50 percent of the DTOS.
    Although not fully implemented, the program has already significantly
    improved our overall readiness and response capability. This was
    evident following Hurricane Bonnie and Georges last Fall. We spent
    substantially less time setting up for and commencing effective
    emergency operations in the disaster areas of these storms.
        We plan to train another 18 teams in fiscal year 1999, and retrain
    the 24 already trained based on lessons learned. The balance of the
    DTOS is scheduled for delivery by June, in time for the upcoming
    hurricane season. Once the program is fully implemented, we will be
    able dispatch our nation-wide resource of highly-trained personnel and
    state-of-the-art DTOS to any area where our presence is required in
    support of emergency activities of federal, State and local agencies.
                       improvement in business operations
                                  introduction
        We continue to improve our business operations through
    implementation of better regulations, systems, processes, and practices
    in the interest of more efficient and effective execution of our Civil
    Works and Military Programs. I would like to update you on continued
    progress at this in strategic planning, project management, and our
    small business program.
                               strategic planning
        For the Corps to continue to fulfill its role in serving the Army
    and the Nation we must continually look out beyond current initiatives
    and anticipate what changes will be needed next. Working from our
    Corps-wide Vision we are developing the strategic management processes
    that will guide the Corps of the future.
        Our first initiatives were aimed at quickly identifying things we
    needed to improve right away. Headquarters and Division Campaign Plans,
    and District Operations Plans were the result of these initiatives.
    Next, we started the more deliberate work of identifying where the
    Corps needs to focus efforts for additional change. We have now merged
    the quick-start initiatives and the deliberate analysis into an
    integrated ongoing strategic management process led by the senior
    officers and civilians in my Headquarters who compose our newly
    established Strategic Management Board.
                               project management
    New Regulation
        A year ago, I issued a new Programs and Project Management
    Regulation which revolutionizes the way we conduct our work. This
    regulation established a Project Management Business Process for
    accomplishing our activities. This change is making the Corps far more
    customer focused than in the past, with an orientation toward project
    rather than process. Through a number of initiatives, I am continuing
    this revolution by removing Corps headquarters from the business of
    managing projects on a day-to-day basis, and delegating more execution
    responsibility and accountability to the field.
    Planning Process
        We are relooking our entire planning process from the time a
    project is identified until the PCA is signed. I have approved, for
    implementation, the recommendations of a Process Action Team to
    streamline the process, minimize burdens on local sponsors, and
    delegate much of the approval and execution authority to divisions and
    districts, thus expediting agreements. We are undertaking immediate,
    near-term, and long-term measures to address the recommendations. These
    steps should simplify and expedite project negotiations, strengthening
    our partnership with nonfederal sponsors in execution of our Civil
    Works Program, to the benefit of the Nation.
    Continuing Authorities Program
        Late last year, on recognizing that our Continuing Authorities
    Program (CAP) was not performing at full potential, we established a
    Process Action Team to review the process and make recommendations for
    change to improve execution. Presently, we are working to implement the
    team's recommendation that we effect a uniform and streamlined process
    for all 9 CAP authorities. The recommendation envisions changes in
    current regulations and guidance to: vest approval authority for all
    CAP matters in 15 divisions; allocate most of appropriated funding for
    CAP to divisions, vesting authority for financial management in
    divisions; and develop and provide model PCAs especially for the CAP.
    These steps should breath new life into the CAP, promoting maximum
    performance of this very important part of our Civil Works Program, to
    the considerable benefit of the Nation. We are also recommended
    statutory changes to standardize costsharing and project cost limits.
                             small business program
        I am committed to ensuring that small businesses have the
    opportunity to participate in our procurements and that we provide the
    training and counseling to help them succeed. I have put this program
    on the front burner for two reasons. First, it's the policy of our
    government to assist qualified small businesses in obtaining and
    executing procurement contracts. But, beyond policy, it makes strategic
    business sense to promote competition and develop businesses to insure
    a broad base of capable suppliers. I consider the Small Business
    Program mission vital to the Nation's economic prosperity.
        The Corps of Engineers exceeded all expectations in the Small
    Business Program for fiscal year 1998. We led all other Army Commands
    in prime contract awards to small businesses, small disadvantaged
    businesses, and woman-owned small businesses. The Corps of Engineers
    accounted for one third of Army's prime contract awards to small
    businesses, small disadvantaged businesses, and woman-owned small
    businesses.
        We maintain a strong outreach program to promote participation of
    small disadvantaged business in our procurements, and counsel them on
    how to do business with us. We have made contracting with women and
    minorities a priority. This past December we hosted our second Annual
    Small Business Conference. The conference focused on engineering,
    construction, environmental, and research and development activities of
    the Army Corps of Engineers. It provided a forum for direct exchange of
    information and ideas between our commanders and small business
    leaders.
        An example of our success in partnering with small businesses is
    the recent recovery effort in Puerto Rico following Hurricane Georges.
    Our commanders were committed to promoting small business participation
    in the recovery, and, in turn, the small business involved gave
    outstanding support. I commend them both.
                       government performance and results
        The Government Performance and Results Act of 1993 (GPRA) requires
    that we show how improvements in our business processes, and efforts to
    balance scarce budgetary resources between operation and maintenance
    and new investments, ultimately impact delivery of our products and
    services to the Nation.
        The already effected and proposed improvements in our business
    processes and practices, discussed elsewhere in this statement, have
    already resulted and in, and will continue to result in, more efficient
    and timely production of our Civil Works Program products, less burden
    on local sponsors who participate in the production through financial
    support and otherwise, greater capability to be responsive to the water
    resource management needs of the Nation, and greater customer
    satisfaction.
        Until recently, benefits of these process improvements could be
    shown only at the project level, and not the program level. Likewise,
    we could show the impacts of alternative funding on program services
    levels, and the timing of program results at the project level; but not
    the program level. Now, we are testing an initial set of results-
    oriented performance measures for demonstrating the contributions of
    internal process improvements and impacts of different levels of
    funding for programs. Our goal is to comply with GPRA in development of
    a comprehensive set of results-oriented program performance measures.
    We are discussing these measures with OMB.
                 corps of engineers financial management system
        In March 1998 we completed the process of deploying the Corps of
    Engineers Financial Management System (CEFMS) to all 61 locations (63
    databases). Project and program managers can now benefit from accurate/
    timely financial information.
        We have begun to modernize CEFMS by moving it into a Graphical User
    Interface (GUI) environment. This will take advantage of Internet
    browser technology to enable modern application processing, improve
    usability of the system, and reduce future operations and support
    costs. Deployment of the CEFMS GUI version is scheduled for fiscal year
    2000.
        In December 1998 CEFMS was certified in Army's Y2K (year 2000)
    database as compliant with requirements for operating in Y2K. The US
    Army Audit Agency has completed an independent review of our test
    results and, based on a draft report, will 17 confirm that CEFMS is Y2K
    compliant.
        The rest of our systems will be Y2K compliant by the end of this
    month. As a result, our business operations will continue into the new
    century without a hitch. I am proud of this accomplishment.
                                  corps vision
        Finally, Mr. Chairman, each year I brief you on the status of the
    Corps Vision. It remains as I showed you last year:
        The U. S. Army Corps of Engineers is:
      --the world's premier engineering organization, trained and ready to
            provide support any time, any place.
      --a full-spectrum engineer force of high quality, dedicated soldiers
            and civilians:
          --a vital part of the Army;
          --the engineer team of choice--responding to our Nation's needs
            in peace and war; and
          --a values-based organization--respected, responsive, and
            reliable
      --changing today to meet tomorrow's challenges!
        This Vision is the foundation of all of our strategic planning,
    restructuring, and process improvements already accomplished, or to be
    accomplished near- and long-term. Improvements discussed elsewhere in
    this statement are a direct result of this Vision. As mentioned, we now
    have an integrated ongoing strategic management process overseen by the
    newly formed Strategic Management Board, led by the senior officers and
    civilians in headquarters. Through this process and this board our
    Vision will endure to the continued significant benefit to the Corps,
    Army, and Nation.
                                   conclusion
        The President's Budget for the Corps of Engineers is a good one.
    However, we must continue to find ways to reduce our costs and shift
    more of those remaining to direct 18 beneficiaries of our services.
    Meanwhile, we will do our very best to execute the Civil Works Program
    for maximum benefit to the Nation.
        Our Vision commits us to dramatic improvement in performance and
    customer satisfaction within available resources, with a goal of making
    revolutionary, not evolutionary, improvements in our processes and
    products--continually maximizing actual and potential values of our
    organization to the Civil Works Program, the Army, and the Nation.
        Thank you Mr. Chairman and Members of the Committee. This concludes
    my statement.

    DEPARTMENT OF THE ARMY--CORPS OF ENGINEERS CIVIL WORKS--FISCAL YEAR 2000
                                 DIRECT PROGRAM
               [New obligation authority in thousands of dollars]
    ------------------------------------------------------------------------
                                                    Fiscal year
                                      --------------------------------------
          Source/program/account         Initial appropriation      Budget
                                      --------------------------------------
                                           1998         1999         2000
    ------------------------------------------------------------------------
    APPROPRIATION:
        Discretionary and Related
         Mandatory:
            Defense: Formerly              140,000      140,000      150,000
             Utilized Sites Remedial
             Action Program (FUSRAP).
            Domestic: General              156,804      161,747      135,000
             Investigations..........
            Construction, General:
                General Fund.........    1,394,167    1,353,372      927,200
                Harbor Maintenance     ...........        3,255  ...........
                 Trust Fund..........
                Harbor Services Fund.  ...........  ...........      257,700
                Inland Waterway Trust       79,206       73,258       55,000
                 Fund................
                                      --------------------------------------
                  Total..............    1,473,373    1,429,885    1,239,900
            Operation and
             Maintenance, General:
                General Fund.........    1,209,137    1,617,551    1,107,300
                Harbor Maintenance         496,900  ...........  ...........
                 Trust Fund..........
                Harbor Services Fund.  ...........  ...........      692,900
                Special Recreation          33,988       35,701       35,700
                 User Fees Fund......
                                      --------------------------------------
                  Total..............    1,740,025    1,653,252    1,835,900
            Flood Control,                 296,212      321,149      280,000
             Mississippi River and
             Tributaries.............
            Regulatory Program.......      106,000      106,000      117,000
            General Expenses.........      148,000      148,000      148,000
            Flood Control and Coastal        4,000  ...........  ...........
             Emergencies.............
                                      --------------------------------------
              Total (Domestic).......    3,924,414    3,820,033    3,755,800
                                      --------------------------------------
              Total (Defense and         4,064,414    3,960,033    3,905,800
               Domestic).............
                                      ======================================
        Mandatory, Only:
            Permanent Appropriations.       14,627       18,098       18,576
            Coastal Wetlands
             Restoration Trust Fund:
                Corps................       10,000       10,000       10,000
                Others (excluded)....       37,541       38,300       44,180
                                      --------------------------------------
                  Total..............       47,541       48,300       54,180
            Rivers and Harbors             262,274      280,896      251,141
             Contributions...........
            Bonneville Power           ...........      106,000      107,000
             Administration..........
            Washington Aqueduct             24,000       22,000  ...........
             (borrowing authority, ex-
               cluded)...............
                                      --------------------------------------
                Total................      286,901      414,994      386,717
                                      --------------------------------------
                TOTAL (Discretionary     4,351,315    4,375,027    4,292,517
                 and Mandatory)......
    ------------------------------------------------------------------------

                          statement of senator bennett

        Senator Bennett [presiding]. Thank you very much. We
    appreciate your being here.
        There are some who think you should get hazard pay for the
    times you appear before this committee. You have an unthankful
    task in some of the responsibilities you assume, but we agree
    that your work is of the utmost importance in protecting the
    water resources.
        I would like to make the same comment to you gentlemen that
    I made to the previous panel with respect to the Army Corps
    personnel in Utah. They are very capable and very thorough in
    their duties and take their responsibilities very seriously. We
    have had differences of opinion with them from time to time,
    but we have enjoyed working with them and recognize the
    seriousness with which they approach their tasks.
        Now, I want to reiterate my support for a few minor
    projects we have worked on together, again as was the case with
    the last panel, to get this in and on the record so that you
    understand how seriously I take them.

              upper jordan river restoration, section 206, project

        The progress on the restoration of the upper Jordan River
    is going well. The environmental restoration project has been
    completed. Plans and specifications for the project have been
    initiated, and we think we will be ready to proceed with
    construction in 2001.
        Salt Lake County has worked closely with EPA and the Corps
    and the Interior Department to properly manage water resources
    on a watershed basis. Pollution from non-point sources is
    still, of course, a matter of concern, and channel restoration
    of the upper Jordan River is a critical factor in reducing non-
    point source pollution. We need about $1 million to complete
    the plans and specifications, as well as an exemption from the
    800 cfs flow requirement required for Federal participation in
    urban flood control. We hope to discuss those things with you.
        Now, the Belco dispute. Again, this is a parochial issue.
    It is matter that concerns me. It is an ongoing contract
    dispute between a contractor in Utah and the Corps office in
    Jackson, Wyoming. I know that my staff has communicated with
    you on this issue. It has resulted in a suit against the Corps
    being filed in Federal court over an alleged breach of
    contract.
        I am not taking a position one way or the other. That would
    not be appropriate for a Senator with respect to something
    where there is a legal action pending. I want to ensure,
    however, as every Senator does, that my constituents are
    treated fairly, and based on a limited review, I have the
    feeling that that has not been the case here. I would hope we
    could avoid litigation.
        I have found in some other situations that sitting down in
    my office in the next couple of weeks with the contractor and
    your staff to see if something cannot be worked out might be a
    worthwhile activity. I am willing to do that. If nothing comes
    out of it, then the lawsuit goes forward, but we will at least
    have tried.
        General, would you be open to such a suggestion, or has the
    matter gone so far that you are not willing to talk about it in
    that kind of a setting?
        General Ballard. Well, I am very much aware of this
    particular lawsuit, Senator, and share your concern about doing
    what is fair both for your constituent and the Federal
    Government. At the current time, as you know, we are reviewing
    the status of that case in the office of my General Counsel.
    What I would like to do--and I have not had a chance to discuss
    this case in detail with him. So, prior to agreeing to come and
    meet with you, I would like some time to review the case and
    then provide you an answer to your question about our
    willingness to meet.
        I think it is important that we do whatever it takes to
    make sure that we seek a fair solution, and if the case has not
    gone so far that it would not be inappropriate to meet, I would
    be willing to do that.
        Senator Bennett. Unlike a super majority of the Senate, I
    am not a lawyer.
        General Ballard. Yes, sir.
        Senator Bennett. So, I would try to act as the honest
    arbiter here to see if the two sides can get together. I am not
    anxious to see the legal bills go up either for the Federal
    Government or for the contractor. So, I am available to perform
    that function if you think it would be useful. If not, I
    understand that you must protect your rights and I respect you
    for that.
        General Ballard. Well, I share your concerns, sir, and I
    promise we will get back to you in the next day or so.
        Senator Bennett. Okay.

                               regulatory program

        Now, I have some real concerns regarding the administrative
    appeals process related to your regulatory functions. Putting
    it directly, I am concerned that the Corps has not implemented
    the administrative appeals program despite the instruction of
    both the President and the Congress. I will not go into it
    here, but I have a rather strong statement that I will submit
    for the record, as well as several questions that I will submit
    to you in the expectation that the Corps will answer in detail.
        Senator Bennett. I will be working with my colleagues to
    raise awareness of the need for a workable appeals process that
    is fair to the landowners. We provided the Corps with resources
    and instructions in the past which unfortunately in my view
    have been ignored, and I will be more than willing to provide
    the Corps with some more explicit legislative direction as to
    how to implement this. I would hope that Chairman Domenici
    would back me in this effort, but all of that will become clear
    when I file my statement and give you my questions.
        Those are the only issues that I was ready to raise.
        Senator Craig.
        Senator Craig. Thank you very much, Mr. Chairman.
        Generals, Dr. Westphal, thank you for being with us today.
        Let me echo what the Senator from Utah has said about the
    quality of staff and the working relationships we have. They
    are good and we appreciate them in Idaho. That is always
    valuable dialogue for both me and my staff with all of you
    folks as we work on some of these important issues.

                            snake river dam removal

        I have before me a press release from the Walla Walla
    district office of the Army Corps on March 5 denouncing a
    release coming out of the Sierra Club on March 4. The Sierra
    Club release tried to depict preliminary findings in what is
    known as the DREW study as supporting the notion that removing
    the four lower Snake dams would be advantageous to the economy
    of the Pacific Northwest region.
        Thank you for quickly correcting this inaccurate
    information. It is critically important that we have accurate
    facts. We are watching with an eagle eye the EIS you are all
    involved in to make sure that it is science and not politics.
    Let me very clearly admonish you, though I do not think it is
    necessary. Please do not get involved in the politics of this
    issue or you will destroy your credibility. Stay with the
    science and stay with the engineering facts that you deal with
    so well.
        You can see the loaded nature of this issue by the
    silliness of the Sierra Club release. Headlines: DREW Finds
    Huge Economic Benefits from Partial Removal of Four Lower Snake
    Dams. Wishful thinking on their part to stymie and destroy the
    growth in the economy of the region. No question about it. And
    yet, the science is not even in to suggest that breaching dams
    will save these endangered species of salmonoids that we are
    talking about.
        So, we are awaiting your studies. They will be important to
    the overall character of how we develop a mitigation plan for
    those fish, and it is going to be critical to the region. As
    you heard me say--you were here when I was talking with the
    Bureau of Reclamation--we have spent the last 80 or 90 years
    taking an arid State like Idaho and watering it and making it
    habitable not only for species of plants and animals, but the
    human species, and I do not want to see it dewatered in the
    name of a single species when science would lead us to a
    different, and I hope, better course.
        I noted there is an item in the Corps budget for
    engineering activities directed at the dams and fish passage on
    the Snake-Columbia Rivers. Could you supply for the record how
    much money is in this budget for planning, design, or
    construction of such things as dam modification, surface
    collectors, irrigation project changes, or other activities for
    salmon recovery?
        Dr. Westphal. We will do that.
        General Ballard. Yes, sir.
        Senator Craig. If you would please. And then please be
    specific as to how the money is being requested for each of the
    activities. I think that would be very helpful to us.
        Is there anything being done through the fiscal year 2000
    budget to address the CASPIAN tern issue on Rice Island at the
    mouth of the Columbia? I am recommending you go out and buy
    some coyotes or foxes and put them on that island. [Laughter.]
        [The information follows:]

                               COLUMBIA RIVER FISH MITIGATION, IDAHO, OREGON & WASHINGTON
    ----------------------------------------------------------------------------------------------------------------
                                                                                     Fiscal year 2000
                                                                     -----------------------------------------------
                             Subproject/item                                           Engineering &
                                                                         Planning         design       Construction
    ----------------------------------------------------------------------------------------------------------------
    Ice Harbor:
        Auxiliary Water Supply......................................  ..............             350  ..............
        Anadromous Fish Evaluation Program (AFEP)...................  ..............              60  ..............
    Lower Monumental:
        Auxiliary Water Supply......................................  ..............             350  ..............
        Adult Passive Integrated Transponder Facilities.............  ..............             100  ..............
        End Bay Deflectors..........................................  ..............  ..............              10
    Little Goose:
        Auxiliary Water Supply......................................  ..............             350  ..............
        Extended Screen Barrier Screen Mods.........................  ..............             310           1,200
        Trash Boom..................................................  ..............             550           3,460
        Adult Passive Integrated Transponder Facilities.............  ..............             110  ..............
    Lower Granite:
        Auxiliary Water Supply......................................  ..............             350  ..............
        Juvenile Bypass Facility Improvements.......................  ..............             970  ..............
        Extended Screens Barrier Screen Mods........................  ..............             310           1,200
        Barges Moorage Cells........................................  ..............             250              80
    McNary:
        Fish Ladder Exit Mods.......................................  ..............  ..............             890
        Cylindrical De-water Test...................................  ..............             110           1,190
        Orifice Shelters............................................  ..............              15             765
        Extended Screens Barrier Screens Mods.......................  ..............             250           3,290
        Replace Gates/Stoplogs......................................  ..............             180           2,770
        Adult Passive Integrated Transponder Facilities.............  ..............             110  ..............
    John Day:
        Extended Screen Barrier Screen..............................  ..............           2,310           4,770
        Smolt Monitoring facility...................................  ..............             100           1,080
        End Bay Deflectors..........................................  ..............             205           1,565
    The Dalles:
        Auxiliary Water Supply......................................  ..............           1,120  ..............
        Adult Channel Dewatering....................................  ..............             730  ..............
    Bonneville:
        Bonneville 1st Downstream Migrant & Outfall Facilities......  ..............           3,530             600
        Bonneville 2nd Downstream Migrant & Outfall Facilities......  ..............             570           3,210
        Bonneville 2nd Gatewell Debris..............................  ..............             380             800
    Mitigation Analysis:
        Walla Walla District Study Activities \1\
            Turbine Study...........................................           1,450  ..............  ..............
            Ice Harbor Separator Evaluation.........................             890  ..............  ..............
            Gas Abatement Study.....................................             475  ..............  ..............
            Snake River Feasibility Study...........................             890  ..............  ..............
            Fish Ladder Temp Evaluation.............................             710  ..............  ..............
            Fallback Study Ice Harbor/McNary........................             710  ..............  ..............
            Lower Granite Surface Bypass Collection.................           8,260  ..............  ..............
            Multiple Bypass (AFEP)..................................             770  ..............  ..............
            Estuary PIT Recovery (AFEP).............................             770  ..............  ..............
            Gas Fastrack............................................           2,960  ..............  ..............
        Portland District Study Activities \1\
            Lower Columbia Feasibility Study........................           5,900  ..............  ..............
            Gas Abatement Study.....................................             950  ..............  ..............
            Turbine Survival Program................................           2,900  ..............  ..............
            Bonneville Surface Bypass...............................          12,390  ..............  ..............
            Bonneville 1st Fish Guidance Efficiency.................           2,360  ..............  ..............
            Bonneville Flat Plate Passive...........................              60  ..............  ..............
            Integrated Transponder Facilities Bonneville Adult                   590  ..............  ..............
             Fallback...............................................
            Bonneville 2nd Fish Guidance Efficiency.................           1,770  ..............  ..............
            The Dalles Surface Bypass...............................           2,920  ..............  ..............
            The Dalles Spillway Survival............................           2,720  ..............  ..............
            Powerhouse Surface Bypass...............................             590  ..............  ..............
            Spillway Surface Bypass.................................           1,770  ..............  ..............
            John Day 24 Hour Spill Test.............................           2,950  ..............  ..............
            John Day Mitigation Relocation to Ringold Hatchery......             180  ..............  ..............
            Lower Columbia Adult Measures...........................           2,360  ..............  ..............
            Gas Fastrack............................................             975  ..............  ..............
            Adult Passive Integrated Transponder Facilities.........             180  ..............  ..............
                                                                     -----------------------------------------------
              Total Planning Activities.............................          59,450          13,670          26,880
    ----------------------------------------------------------------------------------------------------------------
    Note: Columbia River Fish Mitigation Project Fiscal Year 2000 Budget Request--$100,000,000.

    \1\ Some of the study activities for the Mitigation Analysis subproject require engineering, design, and
      construction of prototype facilities. If this is so, the cost for this engineering, design, and construction
      is included in the Planning column.

                                  caspian tern

        Senator Craig. Other than that, no.
        Dr. Westphal. I will let General Fuhrman answer this, but I
    think we do have a project to move the Caspian----
        General Fuhrman. We are looking at that in conjunction with
    other agencies as an----
        Senator Craig. But you are a player in that, are you not,
    General?
        General Fuhrman. Yes, we are. We certainly are.
        Senator Gorton. How about some cats?
        Senator Craig. Let the record show that the Senator from
    Idaho is not totally off base here. [Laughter.]
        Senator Burns. How about some wolves?
        Senator Craig. Well, we could be a supplier there is no
    question.
        But it is important that we see what you are doing there
    and how much you are a player. That is important that we
    resolve that issue, for the sake of the young salmon.

                        ports of clarkston and lewiston

        Is there sufficient O&M budget money for dredge work needed
    on the ports of Clarkston and Lewiston in your current budget,
    do you think? I am talking about the ongoing necessary works to
    keep those channels open.
        General Fuhrman. Senator, yes, there is.
        Senator Craig. Thank you.
        Dr. Westphal. Mr. Chairman, Senator Craig, if I could just
    mention one thing----
        Senator Craig. Excuse me, Doctor.
        Dr. Westphal. I am sorry. I just wanted to mention to you
    that I took a trip to the Northwest late last year. In fact, I
    think I spoke with Senator Gorton while I was on that trip. I
    was at Bonneville at the time. I went to the Lower Snake and
    viewed all the projects there with the Corps. It was a very
    short trip and I did not have a chance to really talk to local
    folks, so I just basically talked to the Corps.
        But we are definitely working this whole process, which is,
    as you know, a very, very lengthy and difficult process in a
    way, as carefully as we can, and we are trying to be as
    responsible as we can in responding to the scientific
    information that is required to make these decisions. But the
    release of that information is just a very small piece of the
    overall EIS that is about to come out, hopefully by September
    of this year, and that is why we responded that way. We think
    that in the end we will have a good study that we can stand
    behind.
        Senator Craig. Well, I certainly hope that is the case. You
    saw with your tour out there what I think is a tremendously
    proud legacy and one that we ought to be trying to enhance and
    perfect. And yes, it has problems and one of our problems is
    developing a mitigation plan to try to save these species of
    fish. But it should not be one that we run from at all because
    it has afforded the Pacific Northwest some tremendous assets
    that I am certainly proud of. That is why I am as strident as I
    am with organizations that try to recreate the region in their
    own image for political purposes and ignore the science.
        Thank you.

                           devils lake, north dakota

        Senator Bennett. Senator Dorgan.
        Senator Dorgan. Mr. Chairman, I will be very brief. I do
    want to thank Dr. Westphal, General Ballard, General Fuhrman,
    and Mr. Caver. I must confess that I used to think that dealing
    with the Corps of Engineers was like dealing with pre-
    democratic Eastern European countries, except Romania's
    Ceauescu was easier to deal with. [Laughter.]
        But I have changed my mind. We have gone through some
    significant disasters, the Grand Forks and Devils Lake
    flooding, and the Corps of Engineers has been of invaluable
    assistance to us and has spent a lot of time and a lot of
    effort trying to help us get through these tough times. So, I
    deeply appreciate your commitment to help.
        Dr. Westphal, you have worked with us closely on both
    Devils Lake and Grand Forks. I want to just mention to you--
    members of the subcommittee will be tired of hearing this but
    Devils Lake is continuing to rise. The Senator from Utah,
    Senator Bennett, once offered pumps that they bought apparently
    for the Great Salt Lake and did not use. The problem is that if
    you use pumps, you would have to find a place to pump the
    water. This is not a region where there is an empty pail. So,
    we cannot transfer one region's problem to cause a problem in
    another region in our State. That is the difficulty.
        But we are working through a range of issues, including the
    design of an outlet and a series of other matters. I want to
    impress upon you once again the urgency that I know you
    understand. That lake is expected to rise again this summer. It
    is the most vexing thing in the world to us. It is one of only
    two closed basins in America. The other is the Great Salt Lake.
    It is a flood that comes and stays unlike most other things
    that we deal with. Most floods we deal with are river floods
    where we see a house floating down a raging river someplace and
    then the flood is over and the river subsides. That is not what
    is happening to us in this basin.
        We had a meeting with the Governor and legislative leaders
    and others in Bismarck last Friday talking about the time line
    and other issues, but I would just ask again how you see the
    time line on the Devil's Lake outlet and if you have enough
    resources--I expect you do--committed to this in order to try
    to reach a conclusion on it.
        Dr. Westphal. We have the resources, and the last update I
    had is a little bit dated. It is the end of last year when I
    asked for an update on where we were with the studies. The
    Corps at the District level was incorporating some new data
    into the analysis to try to look at the regional impacts. But
    since then I have not had an update, unless General Fuhrman has
    one. So, let me just say that I will get you an update on when
    we expect to have a report on that.
        Senator Dorgan. I would appreciate that.
        General Fuhrman. Just to add to that, as you are well
    aware, Senator, we are continuing to look at alternatives,
    along with the local sponsors, and hope to have an update to
    Congress by the last of April.
        [The information follows:]

                               Devils Lake Outlet

        The time line for completion of the Devils Lake outlet will be
    addressed in the Interim Report to Congress and is dependent on the
    alternatives evaluated and eventual direction provided. Once there is a
    recommended course of action, additional funding resources of at least
    $5M would be required to initiate and complete plans and specifications
    for approved actions.

                                grand forks, nd

        Senator Dorgan. One other question on the Grand Forks dike.
    The President requested $10 million I believe in his 2000
    budget request. Does this adequately reflect the capability of
    the Corps for the initial construction on the permanent levy in
    the coming fiscal year?
        Dr. Westphal. Yes, that does.
        General Fuhrman. Yes.
        Senator Dorgan. If additional funds would become necessary,
    I assume that the Corps would seek a reprogramming or some
    other approach?
        Dr. Westphal. Yes.
        General Fuhrman. Yes, we would.
        Senator Dorgan. Well, I am not usually so reasonable or so
    agreeable, but I must say that my experience both with the
    previous panel, and also with the Corps of Engineers the last
    few years, has been really quite a remarkable experience. They
    have men and women in the field who work day and night and have
    put a lot on the line for those of us in North Dakota who have
    been threatened by these flooding crises, and I want to say
    thanks to a lot of people who work down in the bowels of your
    agency and who do some awfully good work.
        Dr. Westphal. Thank you, Senator.
        Senator Dorgan. Mr. Chairman, I would like to be able to
    submit a couple of additional questions for the record.
        Senator Bennett. Without objection.
        Senator Dorgan. Thank you very much.

                               yellowtail dam, mt

        Senator Bennett. Senator Burns.
        Senator Burns. We can handle most of your problem up there.
    We will just declare all North Dakota wilderness. We will ship
    our wolves over there. I am just trying to get rid of some
    wolves.
        Senator Dorgan. What is that fellow's name? [Laughter.]
        Senator Burns. Up in our State, just so the people in this
    room understand my previous comment, you cannot touch these
    protected wolves. There is a pack of 10 that is laying 200
    yards off of a guy's barn. He is trying to calve and he
    estimates that he has lost 30 calves and 25 cows, and he cannot
    do anything to stop the wolves. All you can do is watch them
    wolves carry your calf crop off, and you get pretty excited.
        I think I want to raise one issue again, the Yellowtail
    Dam. I think you have some joint responsibilities on the
    Yellowtail with the Bureau of Reclamation on flood control and
    water release. I would suggest that you start the dialogue now
    between the Bureau of Reclamation, because we have a tremendous
    snowpack this year, General, and I fear for that.

                   regulatory administrative appeals process

        I am also concerned, General Ballard, in your appeals
    process, that you have got the rules written for those permits
    that were denied, the denied permits, and you are sort of
    shying away from the jurisdictional part of that language of
    the law. I will tell you we have more problems with the
    jurisdictional end of this situation on wetlands, that problem,
    than we do any other part. So, I would suggest to take the
    language of the law and implement it where you have the most
    problems, and I think most of it is in jurisdiction.
        I can tell you that the Corps has really overstepped its
    bounds in some areas in the wetlands. It is not contiguous to
    impaired waters or to navigable streams or anything like that.
        So, those are the only things that I want to--other than
    that, we have got a lot of work to do on the Missouri that is
    above the Yellowstone, and we want to do that. We are losing
    land every day along the Missouri between Culbertson and
    Williston and we should deal with that. Of course, there again
    that has to do with Fort Peck.
        I am also very interested in working with you as far as the
    Fort Peck interpretive center and those kinds of things, and we
    will work our way through that.
        But you have done some good work up there and we appreciate
    that, but those are the areas that concern me most. I would
    start that dialogue with the Bureau of Reclamation, though,
    because we have a tremendous snowpack this year.
        And thank you for coming, and thank you, Mr. Chairman.
        Senator Bennett. Senator Kohl?

                                lafarge lake, wi

        Senator Kohl. Thank you, Senator Bennett.
        Gentlemen, good to see you here.
        Dr. Westphal. Thank you, Senator.
        Senator Kohl. I would like to ask a series of questions on
    the La Farge Lake deauthorization project.
        The Water Resource Development Act of 1996 deauthorized the
    flood control project at La Farge. The Army Corps of Engineers
    was instructed to transfer the 9,000 acres acquired during the
    1960's and 1970's to the State of Wisconsin and the Department
    of the Interior to be held in trust for the Hochunk Nation.
        Also, as part of the flood control project, the Corps of
    Engineers was given jurisdiction over the relocation and
    maintenance of State highway 131 and a few of the county
    highways.
        Three questions. Number one, when will the land transfer
    project deauthorization and completion of remaining project
    features be accomplished?
        General Fuhrman. I will take that one, Senator. Currently
    field documentation of historic cultural resource protection,
    site safety, environmental remediation of abandoned farm sites
    and wells and real estate activities, all of which need to be
    accomplished prior to the land transfer, are fully funded and
    are on track to be completed by 30 September of this year.
        Senator Kohl. Thank you.
        Will the Corps be including a request for funding to
    implement section 361 in future presidential budgets?
        Dr. Westphal. Well, while we cannot really commit today to
    what we are going to include in the 2001 budget, since we have
    yet to even begin developing that, I will tell you that we will
    proceed on this project as expeditiously as we can, and if we
    need to, we will make an effort to fund what is required. I
    will work with you and your staff to do that.
        Senator Kohl. I do appreciate that.
        One last question. Does the Corps agree that the Wisconsin
    Department of Transportation is in the best position to conduct
    the road relocation, and if so, when will the Corps be
    completing the necessary contractual arrangements with the
    State of Wisconsin on this issue?
        General Fuhrman. Senator, we believe that the Wisconsin
    Department of Transportation has the necessary expertise to do
    an excellent job at accomplishing the highway work that is
    needed and identified out there. We are currently reviewing
    that to determine what types of authorities we have to allow us
    to work with the Department, and we will be working closely
    with you to resolve that issue.
        Senator Kohl. Did I get a clear answer on that? Not as
    clear as I would like.
        General Fuhrman. Well, there is an authorities issue here
    in our ability to grant money to the State, and we will need to
    work with the Congress on that piece of it.
        Senator Kohl. I thank you, and I thank you, Senator
    Bennett.
        Senator Bennett. Thank you.

                mississippi river and tributaries budget request

        Senator Cochran.
        Senator Cochran. Mr. Chairman, it is a pleasure for me to
    be here today to welcome our witnesses. It is my first
    opportunity to congratulate publicly my friend, Dr. Joe
    Westphal, on his service as Assistant Secretary of the Army.
        In looking at the budget request, I noticed that for the
    Mississippi River and Tributaries project, in which I am very
    interested, the President has requested a total of $280 million
    for this next fiscal year. This is the same as the request for
    the current fiscal year.
        Congress reviewed that request last year and found it to be
    woefully inadequate in terms of the capability of the Corps for
    that project and also to protect lives and property in the
    region. So, the amount for fiscal year 1999 was increased to
    $323.6 million, which we hope will go a long way toward getting
    us back on schedule and on track with many of the programs in
    the Mississippi River and Tributaries project.
        My question is--and General Ballard or whoever you suggest
    should answer this--I understand that this is still short of
    the Corps' capability for these activities. I wonder if, for
    the record, you could give us the figure, the dollar amount,
    that the Corps has within its capability for projects within
    the Mississippi River and Tributaries program.
        General Ballard. I think that figure, Senator, is about
    $350 million.
        Dr. Westphal. $350 million.
        Senator Cochran. Which means that if the Congress
    appropriated that amount and the President would sign the bill,
    you could use that money efficiently and effectively to carry
    out the authority that has already been granted to the Corps on
    those projects. Is that correct?
        General Ballard. That is correct, Senator.
        Senator Cochran. I know that some of these projects have
    controversies surrounding them, and I know you are trying to
    deal with those and involve the public. I have been in
    Mississippi on occasions when meetings have been held. We have
    tried to encourage those who have opinions on these to come
    forward. Sometimes they overdo it, but the fact is we are
    trying to make sure that these projects are sensitive to
    environmental concerns, to the needs of production agriculture,
    the people who live in the area, and it is a very, very big
    challenge.
        This is a project that was authorized a long time ago. It
    continues to be short of funds and behind schedule, and a lot
    of people are suffering because of that. We hope that the Corps
    will give added impetus to the work being done in that region
    of the country.
        I notice in the other parts of the budget there are some
    increases being requested, and this is not one of them. I am
    disappointed in that. I hope we can work with you in this
    committee to try to deal with the challenge of meeting our
    responsibilities to the people in that area of the country.
        Dr. Westphal. Yes, sir.
        Senator Cochran. Thank you, Mr. Chairman.
        Senator Burns [presiding]. I guess the chairman ran away.
        Senator Cochran. You are it. [Laughter.]
        Senator Burns. The Senator from Washington.

                           columbia and snake rivers

        Senator Gorton. General Ballard, a year or so ago, we had a
    meeting that was very unpleasant and unhappy for both of us in
    my office about a recreation study carried out by the Walla
    Walla office. Because I remember that and I suspect you do as
    well and do not like unhappy meetings like that, I cannot do
    anything but start my comments off by saying in how positive a
    way you responded. I am still not sure I like much about the
    new survey, but it is much improved over the old one.
        More important than that, however, were the comments that
    Senator Craig made, that when some portions of its results were
    leaked and were put out in a distorted fashion, that you
    stepped forward and said that this was highly misleading and
    that you are going to wait until you have finished with what
    you have done and are going to try to come up with an as
    objective set of answers as you possibly can. That is in the
    finest traditions of the Corps. Having started out unhappily, I
    wanted to tell you how very positively I respond to that kind
    of work on your behalf. It was absolutely first rate.
        General Ballard. Thank you very much, Senator. I do
    remember our meeting and your words are very complimentary. I
    commit to you my continued support as we try to work these
    issues together.
        Senator Gorton. Good.

                          john day dam drawdown study

        Now, I do want to state, again following the same
    philosophy that Senator Craig did, my unhappiness--my
    opposition to two elements in this budget. I have supported
    both the studies that are taking place with respect to the
    Snake River dams and phase one of the John Day studies. I have
    done so in spite of the fact that many of my constituents and
    many on the other side of the river have lobbied me not to
    allow you even to have undertaken those initial studies because
    they feel that any draw-down on John Day and any destruction of
    the Snake River dams would be so overwhelmingly damaging to
    them. My response has been that I did not think that we could
    be against undertaking such studies and that, in fact, that I
    thought they would end up showing the value of those dams.
        Nevertheless, I have to tell you that to ask for money,
    even on a contingent basis, for a second phase of a study when
    you have not completed phase one of the study, and when
    obviously there has been no opportunity for the people of the
    area to respond to phase one, seems to me to be highly
    premature. I am not telling you that at this point that under
    any and all circumstances I would oppose a phase two, although
    it is a lot of money over a considerable period of time, but I
    certainly do want to tell you that I will oppose authorizing it
    or appropriating money even on a contingent basis now before we
    have seen phase one, not only we have seen phase one, but even
    more importantly the people of the area have seen phase one.
        And the McNary study falls in exactly the same category.
        I think we need an opportunity for the people of
    Washington, Oregon, Idaho, and Montana, for that matter, to
    respond to what we are already doing before we take additional
    steps. So, I want to make it clear that I am going to try to
    see to it that those appropriations are not made this year
    without necessarily saying that there are not further studies
    that are appropriate at some time in the future.
        Having said that and having said that you have done so many
    things so well, I do want to ask a question of you now on a
    different subject.

          bonneville dam and the dalles dam powerhouse rehabilitation

        Major rehabilitation efforts have been authorized on the
    Bonneville Dam and on the Dalles Dam, but the requests from the
    administration for powerhouse improvements seem to be
    significantly less than what you could actually use in the year
    2000 by a margin of less than $11 million to more than $16
    million. The Bonneville work that sometime ago was slated to be
    completed in the year 2003 is likely not to be completed until
    the year 2008. Obviously, that drives up costs with the
    contractors that you are working with and power generation
    capability of the dams diminishes as the houses age.
        Why do we not have a request for the amount of money that
    you can efficiently and effectively spend on the Dalles and
    Bonneville for the year 2000?
        General Fuhrman. The amount that we can effectively use is
    $3.3 million, sir.
        Senator Gorton. That is for the Dalles.
        General Fuhrman. Yes.
        Senator Gorton. And Bonneville?
        General Fuhrman. I will have to provide that for the
    record, sir.
        [The information follows:]

         Bonneville Powerhouse Phase II, Oregon and Washington (Major
                                Rehabilitation)

        The fiscal year 2000 amount that we can effectively use for Major
    Rehabilitation at Bonneville is $16.3 million.

                                Drawdown studies

        Senator Gorton. Okay, this is the kind of question that you
    are probably better off answering in writing than directly to
    me in any event.
        I simply want to echo what Senator Craig said. You were
    asked to undertake studies at a certain level, come up with
    engineering feasibility, come up with a number of other
    answers. The determination as to what to do about the results
    of those studies, of course, is a policy determination for
    Congress and recommendations by the President of the United
    States. I just echo what Senator Craig said. I have no reason
    to think that you are not doing this objectively and without
    political considerations in mind, and I simply encourage you to
    keep moving in that direction.
        The Assistant Secretary, in his conversation with me,
    earlier emphasized that as well, and I include him so far in
    the compliments.
        General Fuhrman. Thank you.
        Dr. Westphal. Thank you.
        Senator, I am not 100 percent sure on this, but I believe
    that perhaps one of the reasons that you see funding in there
    for the phase two is that we start the budgeting process so
    early in the previous year and we did not know when the phase
    one EIS feasibility study would be completed. We thought it
    would be completed early, that the NEIMS part of the process
    would be done earlier. In fact, we expected something at the
    beginning of the year. I believe probably that is the reason
    that we went into that proposed----
        Senator Gorton. One of you said September.
        Dr. Westphal. Now it is pushed back to September.
        Senator Gorton. Now it is December.
        General Fuhrman. For that particular John Day phase one
    study, it is due to Congress in December, Senator.
        Senator Gorton. December, okay.
        Mr. Chairman, I thank you very much. That is all I have.

                           credits and reimbursements

        Senator Domenici [presiding]. Thanks for your patience in
    waiting so long.
        Let me talk with you a minute, General. At the last year's
    hearing, I believe the Corps estimated that there was potential
    for around $800 million of unfunded liabilities over the next
    several years for potential reimbursements, credits, and other
    payments for work that has been authorized to be undertaken.
        Could you update the committee on this situation? Do you
    believe this is a big problem? Is it not possible that the
    types of financing arrangements could consume very large
    portions of the construction budget if we are not careful? And
    what are the potential impacts or pitfalls with this kind of
    funding?
        General Ballard. Mr. Chairman, as a way of updating, we are
    looking at credits and potential reimbursement in an amount
    that is approaching roughly $950 million, so a growth of about
    $150 million from what we were forecasting for last year. That
    represents some 46 projects that are both approved, pending or
    in the cue in some fashion or other. Now, all of those that are
    not approved will have to be coordinated with the Congress.
        My concern is that as this amount continues to grow, there
    is some potential that the Corps could end up becoming a grant
    agency in some of our districts. That possibility is there.
        But I am more concerned about the potential loss of
    technical talent and capability within the districts as we
    migrate more toward a grant or a pass-through organization.
    This moves us away from the intent of Congress when the Corps
    of Engineers program was first developed, and that was to have
    a trained cadre of engineers and scientists available to
    respond to a national emergency. So, that is where my concern
    is as this program continues to grow.
        Senator Domenici. Dr. Westphal, you are aware that the
    committee in the conference report on the 1998 energy and water
    appropriations bill placed certain restrictions on the approval
    of reimbursement agreements, acceptance of advanced funds and
    other arrangements, because of our concerns related to the
    potential out-year budget impacts. Now, obviously, the General
    is concerned about what that would do if it became very big.
        Do you feel that the conditions we imposed were reasonable?
    What suggestions do you have which would allow some of these
    financing mechanisms to be used, but still would have some
    reasonable limitation in terms of the overall effect?
        Dr. Westphal. Mr. Chairman, first let me say I echo the
    Chief's concerns about this. I do believe that your concerns
    are justifiable and I do think that there is a need for us to
    work together to come to some understanding on how to deal with
    these demands in the future. It is obvious that we want to try
    to help projects move faster and we want to help constituents
    get the work done in a more rapid fashion perhaps, but it is
    turning out to be a system that in large part is only used by
    those communities and sponsors that have the cost share money
    available, and so other opportunities are not available to
    other communities.
        So, we hope to work with you on some resolution. I do not
    know what that would be today. I think obviously it is the
    prerogative of Congress to make that decision. It has an effect
    on the balance between the appropriators and the authorizers.
    It has an effect on the balance of power within the Congress
    and outside the Congress. I think it is an important decision
    that I would be willing to work with you on, whether it is
    setting caps on the amount of money that we are allowed to go
    through or simply making some determination as to the type of
    project that can be allowed to go forth under a reimbursement.
        Senator Domenici. We look forward to working with you
    technically how we could word it and what would be a reasonable
    limitation. I think we ought to start thinking about it. Maybe
    we can be ready in a couple of months when we are ready to mark
    up and see what we could put in the appropriations bill.

                                new study starts

        While we praise the budget with reference to it having a
    higher funding level requested over last year and not being so
    difficult to try to implement up here on the Hill, I note that
    you only have one new study start included in the 2000 budget.
    Why is this and what makes that one study, the Santa Ynez River
    study in California, so special that it was singled out over
    all others that the Corps has requested to OMB? Did you not
    have about 100 with studies eligible to be initiated?
        Dr. Westphal. We originally recommended 90, sir.
        Senator Domenici. All right. So, 90 that you recommended
    and 1 got funded. I wonder why it got funded. Does anybody
    know?
        Dr. Westphal. Well, the President's budget was working
    under also very significant caps as he tried to provide a
    balanced budget to Congress, one that does not use the surplus,
    uses the surplus for Social Security purposes. Under those
    caps, we had to make some determinations about where we felt
    there was the greatest need to move the program forward. In
    that regard, the O&M part of the budget, taking care of the
    tremendous need that there is out there for maintenance of our
    aged infrastructure, was a higher priority.
        We also felt that we do have a backlog of projects that we
    need to move----
        Senator Domenici. Wait now. I understand all that. Frankly,
    I would like you to provide for the record the 90 and tell us
    how much you requested for each. A lot of them are very small.
        Dr. Westphal. We can do that.
        [The information follows:]

                GENERAL INVESTIGATIONS FISCAL YEAR 2000 REQUESTS
                            [In thousands of dollars]
    ------------------------------------------------------------------------
                                                   Prim. capability
                                         -----------------------------------
                 Study name                                         Fiscal
                                                   State           year 2000
    ------------------------------------------------------------------------
    BARROW COASTAL STORM DAMAGE           AK....................          80
     REDUCTION, AK--Shoreline protection
     for the threatened public
     facilities at Barrow, AK...........
    CHANDALAR RIVER WATERSHED STUDY, AK-- AK....................          80
     Environmental protection for the
     watershed in conjunction with
     navigation and flood protection
     measures...........................
    CHESTER CREEK WATERSHED STUDY, AK--   AK....................         100
     Environmental restoration measures
     for Chester Creek..................
    GASTINEAU CHANNEL, JUNEAU, AK--       AK....................         100
     Channel accessibility for current
     vessel spectrum requirements.......
    SKAGWAY HARBOR, AK--Harbor depth and  AK....................         100
     size for current and projected
     vessel needs.......................
    THORNE BAY HARBOR, AK--Potential for  AK....................         100
     new and expanded harbors at both
     North and South Thorne Bay.........
    SOUTHWEST ARKANSAS, AR--              AR....................         100
     Environmental restoration of the
     Corps reservoirs (Millwood,
     Dequeen, Dierks and Gillham Lakes)
     in Little River basin..............
    RIO SALADO OESTE, SALT RIVER, AZ--    AZ....................         100
     Restoration of riparian habitat and
     water quality in the city of
     Phoenix, AZ........................
    SEDONA, AZ--Flood damage prevention   AZ....................         100
     for Coconino and Yavapi Counties
     and the City of Sedona, AZ.........
    KERN RIVER VALLEY (ISABELLA LAKE),    CA....................         100
     CA--Comprehensive review of project
     operations for environmental
     measures...........................
    KLAMATH RIVER, ECOSYSTEM              CA....................         100
     RESTORATION, CA--Environmental
     restoration measures for anadromous
     fish and ripariam habitat..........
    PAJARO RIVER WATERSHED, CA--Flood     CA....................         100
     damage prevention and environmental
     restoration for 1,300 sq. mi. of
     central California.................
    SAN JACINTO RIVER, CA--Flood damage   CA....................         100
     prevention and environmental
     enhancement opportunities in the
     San Jacinto Watershed..............
    SANTA CLARA COUNTY SHORELINE, CA--    CA....................         100
     Flood damage prevention in low
     lying areas of Santa Clara County..
    WILLIAM G. STONE LOCK, CA             CA....................         200
     (Feasibility)--Review justification
     of lock operations for commercial
     navigation.........................
    OAK CREEK, FLORENCE, CO--Flood        CO....................         100
     damage prevention for the city of
     Florence, CO.
    CHESAPEAKE & DELAWARE CANAL, ENV      DE....................         100
     REST, DE &--Environmental
     restoration including habitat
     restoration through the beneficial
     use of dredged material............
    MID DELAWARE RIVER BASIN              DE....................         100
     COMPREHENSIVE STUDY--Environmental
     restoration and flood damage
     prevention including dredged
     material disposal..................
    HILLSBOROUGH RIVER BASIN, FL--Flood   FL....................         100
     damage prevention and environmental
     restoration through Temple Terrace,
     Sulphur Springs and Tampa, FL......
    MILE POINT, FLORIDA--Erosion along    FL....................         100
     the north bank of the St. Johns
     river in Duval County, Florida.....
    LONG ISLAND, MARSH, AND JOHNS         GA....................         100
     CREEKS, GA--Comprehensive watershed
     master plan for parts of
     metropolitan Atlanta, GA...........
    SAVANNAH HARBOR TIDEGATE, GA--        GA....................         100
     Tidegate Federal maintenance versus
     transfer to non-Federal entity.....
    UTOY, SANDY & PROCTOR CREEKS, GA--    GA....................         100
     Environmental restoration and flood
     damage prevention for central
     Fulton Co., GA and metropolitan
     Atlanta............................
    HILO HARBOR NAVIGATION IMPROVEMENTS,  HI....................          80
     HI--Modification or expansion of
     existing harbor....................
    KAWAIHAE DEEP DRAFT HARBOR            HI....................          80
     MODIFICATIONS, HI--Modifications to
     existing harbor....................
    NAVIGATION IMPROVEMENTS, HONOLOLU     HI....................         120
     DISTRICT--Harbor size and
     configurations for the Commonwealth
     of the Northern Mariana Islands....
    SOUTHEAST ILLINOIS, IL--Ecosystem     IL....................         100
     restoration in the area of two
     Corps constructed projects
     (Harrisburg Local Protection and
     Saline River Channelization).......
    METROPOLITAN REGION OF INDIANAPOLIS,  IN....................         100
     IN--Flood damage prevention
     including the center of Marion
     County, Indiana and metropolitan
     Indianapolis.......................
    ARKANSAS RIVER CHANNEL STUDY, KS--    KS....................         100
     Environmental restoration and flood
     damage prevention of the Arkansas
     River and adjacent lands from the
     Colorado-Kansas state line to the
     vicinity of Great Bend, KS.........
    BANKLICK CREEK BASIN, KY--Flood       KY....................         100
     damage prevention for Kenton
     county, KY.
    EAGLE CREEK RIVER BASIN, KY--Flood    KY....................         100
     damage prevention for communities
     of Carroll county, KY..............
    GREEN RIVER HEADWATERS WATERSHED,     KY....................         100
     KY--Ecosystem restoration through
     the modification to the operation
     of two existing Corps projects.....
    METROPOLITAN REGION OF LOUISVILLE,    KY....................         100
     KY ECOS--Ecosystem restoration
     along the Ohio River and
     tributaries including wetlands
     creation...........................
    TRADEWATER RIVER WATERSHED ECOSYSTEM  KY....................         100
     RESTORATIONS--Ecosystem restoration
     of west central Kentucky including
     Christian, Hopkins, Caldwell,
     Webster Crittenden and Union
     Counties...........................
    ST. BERNARD PARISH, LA--Flood damage  LA....................         100
     prevention for the St. Bernard
     Parish,  LA........................
    CHARLES RIVER WATERSHED RESTORATION,  MA....................         100
     MA--Environmental restoration for
     the watershed portions of
     Middlesex, Suffolk, Norfolk, and
     Worcester counties, MA.............
    COASTAL MASSACHUSETTS ECOSYSTEM       MA....................         100
     RESTORATION, MA--Ecosystem
     restoration including dredge
     material disposal and coastal
     wetlands...........................
    NANTICOKE RIVER BASIN, MD & DE--      MD....................         100
     Environmental restoration including
     watershed planning, wetland
     restoration, and beneficial uses of
     dredged material...................
    REDWOOD RIVER BASIN, MN--             MN....................         100
     Environmental restoration and flood
     damage prevention for Redwood
     county in the vicinity of Marshall,
     MN.................................
    BIG FIVE LEVEE SYSTEM, MO--Flood      MO....................         100
     damage prevention for Union and
     Alexander counties, Illinois.......
    MONROE COUNTY, MO--Flood damage       MO....................         100
     prevention for Monroe County,
     Illinois...........................
    PRAIRIE DU ROCHER (IFC), MO--Flood    MO....................         100
     damage prevention for Randolph
     County, Illinois...................
    BROAD RIVER BASIN, NC & SC--          NC....................         100
     Environmental restoration and flood
     damage prevention for portions of
     18 counties in both North and South
     Carolina...........................
    CAPE FEAR RIVER LOCKS & DAMS, NC--    NC....................         100
     Review operation of locks and dam
     for disposition and/or
     environmental restoration..........
    CURRITUCK SOUND, NC--Environmental    NC....................         100
     restoration in Currituck and Dare
     counties in the northeastern part
     of North Carolina..................
    VERDIGRE CREEK AT VERDIGRE, NE--      NE....................          90
     Flood damage prevention for the
     Village of Verdigre, NE............
    SHREWSBURY RIVER & TRIBUTARIES, NJ--  NJ....................         100
     Flood damage prevention and
     environmental restoration in
     Monmouth County, New Jersey........
    CIMARRON RIVER AND TRIBUTARIES, NM,   NM....................         100
     OK, CO, & KS--Ecosystem restoration
     and flood damage prevention of the
     Cimarron River basin...............
    RATON, NM--Flood damage prevention    NM....................         100
     for city of Raton, NM..............
    GREAT CHAZY RIVER BASIN &             NY....................         100
     TRIBUTARIES, NY--Flood damage
     prevention and environmental
     restoration for the communities of
     Champlin, Mooers Forks, Ellenburg,
     and Ellenburg Depot................
    HUDSON & MOHAWK RIVERS AT WATERFORD,  NY....................         100
     NY--Flood damage prevention and
     environmental restoration for
     Waterford, New York................
    MOHAWK RIVER BASIN, NY--Flood damage  NY....................         100
     prevention for Oneida, Herkimer,
     Schoharie, Greene, and Montgomery
     Counties, New York.................
    SARANAC RIVER BASIN & TRIBUTARIES,    NY....................         100
     NY--Flood damage prevention and
     environmental restoration for the
     communities of Plattsburgh and
     Morrisonville......................
    BIG DARBY CREEK BASIN, OH--           OH....................         100
     Environmental restoration in the
     central part of Ohio within the
     counties of Pickway, Franklin,
     Madison, Union, Logan, Champaign,
     and Clark counties.................
    METROPOLITAN REGION OF CINCINNATI,    OH....................         100
     BUTLER CT--Flood damage prevention
     and ecosystem restoration in
     southwestern Ohio..................
    METROPOLITAN REGION OF CINCINNATI,    OH....................         100
     OH & KY--Ecosystem restoration for
     Hamilton and Clermont Counties in
     Ohio and Boone, Campbell, and
     Kenton Counties in Kentucky........
    ILLINOIS RIVER BASIN, OK--Ecosystem   OK....................         100
     restoration integrating the
     Tenkiller Ferry Lake hydropower
     operations with overall basin plan,
     including land management..........
    OPTIMA LAKE, OK--Optimize lake usage  OK....................         100
    LOWER COLUMBIA RIVER, OR & WA--       OR....................         100
     Comprehensive long range approach
     to the Ecosystem restoration for
     the Lower Columbia River...........
    UMATILLA RIVER, OR--Environmental     OR....................         100
     restoration on the Umatilla Indian
     reserva-  tion.....................
    ALLEGHENY RIVER NAVIGATION, PA--      PA....................         100
     Develop optimum future plan for
     river locks and dams to include
     current operation, closure and
     disposition........................
    CHRISTINA RIVER WATERSHED, PA, MD, &  PA....................         100
     DE--Environmental restoration and
     flood damage prevention in Chester,
     Delaware, and Lancaster Counties,
     PA; New Castle Co., DE; and Cecil
     Co., MD............................
    RIO BAYAMON AT BAYAMON, PR--Flood     PR....................         100
     damage prevention at Rio Bayamon,
     Puerto Rico, ten miles west of San
     Juan...............................
    RIO NIGUA AT ARROYO, PR--Flood        PR....................         100
     damage prevention for the southeast
     part of Puerto Rico, Arroyo........
    PENNINGTON COUNTY & VICINITY, SD--    SD....................          90
     Flood damage prevention for
     Pennington County, South Dakota,
     including Rapid City...............
    BUFFALO BAYOU & TRIBUTARIES, TX--     TX....................         100
     Flood damage prevention and
     environmental restoration for the
     Houston, TX channel extending from
     the Houston Ship Channel upstream
     to Barker Dam......................
    GALVESTON BEACH EROSION, TX--Prevent  TX....................         100
     or mitigate shore damages
     attributable to the Federal
     navigation works...................
    GULF INTRACOASTAL WATERWAY--BRAZOS    TX....................         100
     RIVER, TX--Modification of
     floodgate configuration to reduce
     traffic accidents and delays.......
    GULF INTRACOASTAL WATERWAY--COLORADO  TX....................         100
     RIVER, TX--Modification to the
     Colorado River Locks to reduce
     traffic accidents and delays.......
    GULF INTRACOASTAL WATERWAY--SABINE    TX....................         100
     RIVER, TX--Review navigational
     needs and environmental restoration
     (Sabine River to High Island, TX)..
    LOWER BRAZOS RIVER, TX--Flood damage  TX....................         100
     prevention for the Texas counties
     of; Brazoria, Fort Bend, Austin and
     Waller.............................
    LOWER GUDALUPE & SAN ANTONIO RIVERS,  TX....................         100
     TX--Flood damage prevention and
     environmental restoration for
     potions of Calhoun, Dewitt,
     Gonzales, and Victoria counties....
    UPPER GUADALUPE & SAN ANTONIO RIVER   TX....................         100
     BASINS, TX--Ecosystem restoration
     and flood damage reduction within
     the south-central part of Texas....
    CLINCH RIVER WATERSHED, VA--          VA....................         100
     Environmental restoration and flood
     damage reduction in southwest
     Virginia and includes the
     communities of Raven, Richlands,
     Doran, and Dante...................
    JOHN H. KERR RESERVOIR, VA & NC--     VA....................         100
     Flood damage prevention and
     environmental restoration of north-
     central North Carolina and south-
     central Virginia...................
    LOWER RAPPAHANNOCK RIVER BASIN, VA--  VA....................         100
     Environmental restoration for a ten
     county area east of Richmond and
     south of Washington, DC............
    LYNNHAVEN RIVER BASIN, VA--           VA....................         100
     Environmental restoration including
     wetland restoration on the south
     shore of the Chesapeake Bay........
    OMPOMPANOOSUC RIVER, VT--             VT....................         100
     Environmental restoration in east
     central Vermont....................
    MOUNT ST. HELENS ENV RESTORATION,     WA....................         100
     WA--Environmental restoration of
     wetlands, riverine, riparian, and
     upland habitats lost or altered due
     to the Mt. St. Helens eruption.....
    NEW CREEK WATERSHED, WV--             WV....................         100
     Environmental restoration and flood
     damage prevention in Mineral and
     Grant Counties, West Virginia......
    ------------------------------------------------------------------------

                              santa ynez, ca study

        Senator Domenici. So, I understand budgeting and caps. I
    appreciate your reminding me, but do not worry about it.
        What I want to know is why the only one to be chosen was
    this Santa----
        Dr. Westphal. Santa Ynez?
        Senator Domenici. Ynez. Yes, gee, I should know that. Ynez.
        Dr. Westphal. Santa Ynez, right.
        Well, it was a model project that had elements of flood
    protection, good environmental restoration. It was a good study
    that was well supported by its cost share sponsors. It was a
    good model project and it was determined to be one that we
    could support.
        Senator Domenici. Well, my guess is that it has some
    unusual support within the administration. [Laughter.]
        You know, you would be better off if you just said it.
        In any event, would you please tell us in detail why it is
    so great since you are here defending it. Give it to us in
    writing.
        Dr. Westphal. Yes, sir.
        [The information follows:]

                                   Santa Ynez

        The selection was based upon a combination of factors including:
    flood threat, potential economic viability of a recommended plan,
    environmental impacts, and the support and likelihood of non-Federal
    participation for the implementation of a solution.

                              harbor services fund

        Senator Domenici. I have nothing against it. Obviously, I
    do not know much about it. I could hardly pronounce its name.
    So, I have no prejudices or bias.
        Now, while we said the budget looked better, there is
    something in it that is kind of difficult because, as the
    President has done in a number of appropriations, he does not
    break the caps, because he gets some receipts, some new taxes
    or new revenues, and he puts that in the appropriations bill.
    Obviously that offsets the spending. So, if you wondering what
    is the big magic about breaking the caps but not breaking them,
    it is this kind of thing.
        In this budget, you have a very large amount of money for a
    Harbor Services Trust Fund, almost $1 billion, $900 million.
    Probably part of that is old taxes, old revenues, but what
    portion of it would levy new burdens on somebody or some entity
    to pay taxes or fees?
        Dr. Westphal. It is a fee proposed on the vessel carriers.
    It is a user fee. It would collect about $1 billion, $951
    million, and that is the amount that we project to expend on
    the maintenance, dredging, and construction side on the
    navigation projects. So, we are attempting to collect only the
    amount that would be required to spend every year to develop
    and maintain these ports.
        Senator Domenici. Yes. Well, I guess what I need to know
    is--maybe your budget man could tell me--in this new trust fund
    how much of that is from residual old user fees or old taxes?
        General Fuhrman. About $600 million of that would be
    equivalent to what came out of the existing Harbor Maintenance
    Trust Fund, and the new piece of that would be about $300
    million, which is designated toward the new construction.
        Senator Domenici. If we did nothing and did not even create
    this Harbor Services Fund, there is about $600 million coming
    in. If the appropriations process chose to put in the bill, it
    pays for $600 million of this $900 million, meaning somewhere
    between $250 million and $300 million is new. Now, can somebody
    explain to me where the $300 million new in fees come from? Not
    the old ones. Nobody is complaining about those. They already
    exist. We do not want to bother a sleeping dog.
        I happen to be the first one to pass one of those, in case
    you are wondering. The first tax for the user fees came up in a
    little committee I was on 26 years ago. I almost got thrown out
    of the Senate for it. [Laughter.]
        Everybody wondered what the hell a New Mexican had to do
    with asking southern States to pay a little fee for the lock
    and dam. But it passed eventually. So, it is in there, that
    diesel tax. It has gone up since then.
        Now, what is the new one? What is the new stuff? Does
    anybody know?
        Dr. Westphal. If I understand your question--and maybe I am
    not understanding exactly, but there is about $1 billion in the
    existing fund. The proposal is to repeal that existing fund and
    transfer the balances over to the new fund and make those
    balances available for appropriations.
        Senator Domenici. Now, let me start over. There is $250
    million for construction that is currently not authorized. Does
    this budget propose that we raise the money for that from new
    source of revenue?
        Dr. Westphal. From the harbor services user fee.
        Senator Domenici. Is that new?
        Dr. Westphal. Well, it is a proposed fee that Congress
    would have to approve.
        Senator Domenici. I guess I would like to just know, how
    much are we going to raise fees and on whom to make this trust
    fund as solvent as you want it to fit your budget, $250 million
    worth. Who is going to pay that?
        General Fuhrman. Currently we have the Harbor Maintenance
    Trust Fund which is funded by a tax, and that is used for
    maintenance and repair. That is generating about $600 million a
    year for operations and maintenance. That would be done away
    with and a new fee structure established for a user fee that
    would generate $950 million a year, of which about $300 million
    would be used for new construction and the remainder would be
    used for the same thing the old harbor maintenance trust fund
    was used for, which was maintenance.
        Senator Domenici. So, somebody has to be able to tell us of
    this $950 million--I understand what you are saying--how much
    resembles, looks like, is very close to what we are currently
    doing, what we are going to do under a new trust fund, and how
    much would be new? Where would the new money come from that we
    are getting? Can you do that for me? If you cannot do it today,
    you can do it in a report to me, or how can you do that?
        Dr. Westphal. Typically we need about $900 million. We want
    to be able to raise that amount of money with the use of the
    new fee to not have any carryover balances, essentially be able
    for you to appropriate what we collect in the fee annually and
    put in the fund.
        Senator Domenici. I understand.
        Dr. Westphal. Now, this first year, since you do not have
    the proposal yet--the proposal is coming in a few weeks--if you
    approve the harbor services fee proposal, we will not have
    enough money in the new fund to fund fully the $1 billion. We
    will have to be able to transfer the monies from the existing
    fund to the new fund to be able to do that.
        Senator Domenici. The fund never paid for new construction,
    but it is going to pay for new construction under the new
    proposal.
        Dr. Westphal. Right.
        Senator Domenici. So, it is a bigger fund with a bigger
    purpose.
        General Fuhrman. Yes, sir. New construction up to this
    point in time has been paid out of general revenues.
        Senator Domenici. Now, obviously, when you increase the
    size of the trust fund on the receipt side so that you will
    have more money to spend, you have got to tax somebody that is
    not being taxed now, and that is what I would like to get. Now,
    maybe it is not ready yet.
        Dr. Westphal. Well, no, the harbor maintenance tax was
    found unconstitutional last year by the Supreme Court--the
    portion of that tax at least that was levied on exports. That
    tax was being levied on the commodities. So, with that, we had
    to basically only collect the import side of that. On the
    import side, we have got problems with GATT and some of our
    trading partners in Europe who are challenging the import side
    of that fee.
        So, our plan that we are going to submit to Congress is to
    repeal the entire harbor maintenance tax and replace it with a
    harbor services user fee, which essentially would shift from a
    tax on the commodities to a fee on the vessel carrier, so on
    the carriers of those commodities; in other words, relating the
    fee to the services we provide to the ships as they enter the
    channels and enter the ports and make that fee equivalent to
    the work we have to do to maintain the ports and maintain their
    accessibility nationwide.

                       support for the harbor service fee

        Senator Domenici. There is an argument against this that
    will be made obviously that the whole Nation benefits, not just
    those from a system of harbors and inland waterways and the
    like. But is there general agreement and support within the
    shipping community for this approach that the administration is
    talking about?
        Dr. Westphal. Well, Senator, when I first came on board, we
    had a proposal ready to go, and I did some vetting of that
    proposal with various stakeholders. There was very little, if
    any, support for it at the time. We had some difficulty
    defending the proposal, to be honest with you. So we sent that
    proposal back to our analysts and our folks that had put it
    together to work up some of the recommendations and concerns of
    the stakeholders. We spent almost 6 to 7 months doing that.
        Today, we have a proposal that is now currently being
    vetted with the other Federal agencies that I think is a much
    more acceptable proposal. I think that it will get a fair
    assessment from stakeholders. It may still be opposed by some,
    but essentially I think we have addressed many of their
    concerns and it is a much more defensible proposal. We hope to
    be able to bring it to you within the next few weeks after we
    go through that interagency process.
        Senator Domenici. So, the acceptability of that and the
    ability of us to count it in the budget is going to be very
    important as to whether you have a good program or not a good
    program. So, we are right back or we might be. If Congress says
    we are not going to do this thing, then we are very short in
    terms of having enough money to do this.
        Dr. Westphal. It will affect approximately about $300
    million roughly for the construction side on the navigation
    part of the budget. Yes, sir.

                             administrative appeals

        Senator Domenici. Now, just two questions about the
    regulatory program, administrative appeals. The conference
    report in 1998 stated, ``The conferees expect that the increase
    provided over the amount appropriated in fiscal year 1997 will
    be used to begin implementation of an administrative appeals
    process for the Corps of Engineers Regulatory Program.'' The
    Energy and Water Subcommittee of the House and Senate both
    stated their concern for implementing this process again in
    1999.
        Have you complied with the directions of Congress, and if
    you have not, why not?
        Dr. Westphal. Well, Mr. Chairman, I have to be honest and
    say, no, we have not complied with it in the sense that it has
    taken us much longer to develop the rule and to put it together
    and get it ready to go to the Federal Register. The rule on the
    denial part is at the Federal Register today as we speak. But
    it has taken much longer than you and the committee wanted us
    to take on that.
        On the jurisdictional determination, the rule is also ready
    to go forward, and we believe that with the added funds that we
    have proposed in the budget this year, we will be able to
    implement that part of the rule once it gets vetted through the
    Federal Register process.
        Senator Domenici. So, the expectation that we had was that
    the Corps would implement both an administrative appeals
    process and the jurisdiction determination appeals process. So,
    what is the timetable for implementing those processes and
    procedures now?
        Dr. Westphal. I probably have to get back to you
    specifically on the dates, but the rule is now in the Federal
    Register on the denial part, and the other, the jurisdictional
    part, is getting ready to go anytime now. So, I do not recall
    if it is a 30-day or 60-day period for response to the rule,
    and then there is the final draft that has to be submitted
    later in the summer. So, I am hoping that by the end of this
    year we will be able to say we are implementing the rule.
        General Fuhrman. With regard to the denial piece, Senator,
    that is essentially in effect as soon as it hits the Federal
    Register. So, any permit actions that take place out there
    after that are subject to the appeals process for that.
        Senator Domenici. Well, Congress has specifically earmarked
    or provided $5 million for the Corps to implement the
    administrative appeals process for 1998 and for 1999. In light
    of the fact that you have not implemented the appeals process,
    how were these funds used and why did you not take appropriate
    action to initiate and fund the administrative appeals process
    pending the rules? How was the money used? Was it used, that $5
    million?
        General Fuhrman. Yes, sir. Last year you appropriated $106
    million to us, which was $5 million over the previous year's
    appropriation of $101 million. Our budget in the regulatory
    business is primarily personnel. Some 80 to 90 percent of that
    is personnel, some 900 people spread throughout the country,
    some 90,000 actions each year.
        And we have worked hard at moving forward in trying to
    satisfy the report language of the Congress in implementing
    these rules. We decided to do it in a phased fashion, given the
    resources that we had to move forward with. From my
    perspective, our folks out there are very dedicated. The folks
    out there have done a good job of trying to reach that goal.
        Senator Domenici. So, you used it to maintain the quality
    of your staff.
        General Fuhrman. The quality of the program, sir.
        General Ballard. Not only the quality of the program, but
    Senator, as you know, we had a tremendous backlog and so we
    used quite a bit of that money to work the backlog off and to
    maintain the quality of the staff.

                           level deferred maintenance

        Senator Domenici. I have only three remaining questions and
    they will not take long. General Ballard and General Fuhrman,
    what is the level of deferred critical maintenance work in the
    civil works program, and does it concern you? Can you give the
    committee an example of the type of work which falls into this
    category of critical deferred maintenance and what the impacts
    would be on project operations or efficiencies if this failed
    to occur?
        General Ballard. Sir, we are looking at a backlog of
    deferred maintenance of about $1.6 billion. It is a concern of
    ours if we are to maintain those critical infrastructures that
    we have out there. This particular budget is a good budget and
    will put a curb to some of that growth, but it does not address
    the fact that we still have back there some $1.6 billion.
        I would ask General Fuhrman to read you some of those
    examples.
        General Fuhrman. I will submit a summary for the record,
    Senator, but just a couple of examples, for instance, to
    replace two miter gates at the Gulf Intercoastal Waterway. It
    is a $3 million cost. Concrete repairs at one of our upper
    Mississippi River locks, about $600,000. Repair structural
    elements at several of our other locks, another $4.4 million.
        [The information follows:]

           Operation and Maintenance--Backlog of Deferred Maintenance

                             [Dollars in Thousands]

            Work Category                                           Estimate

    Additional Operations And Investigations To Optimize
        Project Effectiveness...............................        $109,781
    Construction And Maintenance Of Dredged Material
        Disposal Facilities For Navigation..................          26,952
    Dredging................................................         294,850
    Environmental Compliance................................          13,073
    Maintenance and Development Of Recreation Facilities,
        Visitor Centers, Operating Equipment, Etc...........         190,023
    Maintenance Of Dams, Reservoirs, Structures, Service
        Facilities, Equipment, Etc.--Flood Damage Reduction.         132,046
    Maintenance of Hydropower Projects......................          96,960
    Maintenance Of Locks, Dams, Reservoirs, Service
        Facilities, Equipment, Etc. For Navigation..........         714,029
    Maintenance Of Natural Resources Facilities Including
        Fish And Wildlife...................................          12,983
    Mitigation Of Archeological And Cultural Resources......          14,110
    Real Estate Activities, Including Claims, Audits,
        Encroachments, Etc..................................          22,421
    Remaining O&M Funded Major Rehabilitations For
        Navigation..........................................             252
    Water Management Equipment..............................           1,537
                        --------------------------------------------------------
                        ____________________________________________________
          Total.............................................       1,629,017

                               project conditions

        Senator Domenici. What is the condition that we are talking
    about here that makes these critical? What is wrong?
        General Fuhrman. Very close to failing in the next several
    years, and we need to get in and fix it now. It is not a safety
    issue right now, but has the potential to be a safety issue in
    the very near term.
        General Ballard. And we have similar problems, Senator, in
    powerplants and all of the infrastructure that we own. As you
    know, we have some structures that are well over 100 years old,
    and they are in a sad state of repair and we need to do
    something about it.
        Senator Domenici. Well, let me tell you, every year when we
    go through the individual budgets up here, I bite my lip and
    get more and more concerned. The President of the United States
    goes on national television and tells America how great we are
    and says I need 81 new programs, and we have got a backlog of
    projects that may fail on us causing significant economic
    impact to the country. It seems like it is better to announce
    that you have got something new for everyone than to do what
    you are obligated to do.
        I cannot find $1.6 billion. I cannot find $300 million or
    $400 million to get it started. They did not give us enough of
    a budget, and the Congress is not going to invent this money.
    It all comes out of the same pot.
        So, I wish I could remember these when I have to go debate
    and talk about all these new programs. We could probably add up
    things that line agencies of the Federal Government submitted
    as projects they need, and it probably exceeds all the new
    money for new programs. But just to repeat myself, it is not
    very politically sexy to get up there and say we need $1.6
    billion in the State of the Union for water projects to fix
    locks and dams that are going to fall apart.
        You do not have anything to do with that. That is above
    your pay grade too, except you can fight for it. I hope you
    did. Did you submit these requests for these deferred
    maintenance stuff in your budget process?
        Dr. Westphal. Yes, I did.

                                   dam safety

        Senator Domenici. Now, the same question that I asked with
    reference to dam structure safety of the Bureau of Reclamation.
    Can you submit for the record a summary of what processes and
    procedures you used to end up being able to tell this
    committee, as I assume you will, that the dams that you are in
    control of and manage, et cetera are in good shape and there is
    no imminent danger, unless it is something untoward, of
    failures? Can you submit that to us in writing?
        General Fuhrman. Yes, we can, sir.
        Senator Domenici. Is that a true statement that you would
    answer in some way similar to what I just stated?
        General Fuhrman. Yes, sir. We have a very effective dam
    safety program and consider it one of our most important pieces
    of business.
        [The information follows:]

                     Corps of Engineers Dam Safety Program

        The Corps of Engineers has a very effective dam safety program and
    consider it one of our most important pieces of business. The Army
    Corps of Engineers actively manages our dams to ensure that the risks
    to the public are minimized. We have no dams which are known to present
    an imminent danger to the public.
        Our dam safety program was established and has been maintained to
    be in compliance with the Federal Guidelines for Dam Safety. We are an
    active member of the Interagency Committee on Dam Safety (ICODS)--a
    group of Federal officials who exchange information and ideas on dam
    safety and work to foster interstate cooperation; and the National Dam
    Safety Review Board--which provides a forum to elevate dam safety
    issues of National importance.
        Each Corps District has a senior engineering official designated as
    the Dam Safety Officer. It is the Dam Safety Officer's responsibility
    to ensure the proper operation, maintenance, and funding for all of the
    dams under his or her control. Each Dam Safety Officer has the proper
    technical expertise available either on staff, by contract, or from
    other Corps Districts, to safely operate, maintain and assess our dams.
        Our formal programs which help us to ensure dam safety include the
    following:
        Operations and Maintenance Program.--Under this program, we fund
    our day-to-day work on our dams, including smaller repairs and some
    emergency repairs. The staff who operate and maintain our dams, are our
    everyday eyes and ears who keep an eye on the condition and performance
    of their project. This program also funds our monitoring
    instrumentation, which allows us to monitor and evaluate the
    performance and safety of our dams under all loading conditions and
    provides data on project behavior for application to future evaluation
    and designs.
        Formal Periodic Inspection Program.--Our PI program requires a
    thorough inspection and continuing technical evaluation of each dam on
    a 5-year cycle (or more often). This program allows us to uncover
    problems with our structures that are not readily apparent during day-
    to-day surveillance.
        Dam Safety Assurance Program.--Our DSAP provides us with a
    mechanism to evaluate and remediate dam safety concerns related to
    earthquakes, flood capacity, and changes in the state-of-the-art.
    design and construction criteria.
        Major Rehabilitation Program.--Under this program, we fund larger,
    long-duration construction projects which improve the long-term
    reliability or functionality of a dam.
        And finally, each dam which, due to its location, could pose a
    potential risk to life or of serious property damage, has an Emergency
    Action Plan (EAP) which provides procedures to ensure that proper
    actions are taken during a highly unlikely event of a dam safety
    situation beyond our control. An EAP includes procedures for
    identifying and evaluating emergency situations, guidance for emergency
    operations and potential repairs, and notification of affected parties
    concerning existing and potential emergencies.
        In summary, we continue to make dam safety a priority in the Corps
    of Engineers. Our aging inventory of dams will require our continued
    commitment to uphold our dam safety obligation to the American people.

                         acequias irrigation system, nm

        Senator Domenici. Back to two things in my State. The
    Acequias irrigation system, which is a very special historic
    system being preserved for both utilization and historic
    purposes. We expressed concerns about the progress being made
    in this irrigation system rehabilitation in my State. In
    addition, the committee expressed the expectation that the
    Corps would strengthen its communication and coordination
    efforts with the State and local interests. What can you report
    to the committee in this regard?
        Dr. Westphal. Well, I think I will let General Fuhrman give
    you the details, but I think we have made some really good
    progress in this area.
        Senator Domenici. General Fuhrman.
        General Fuhrman. As you remember, Senator, before we were
    going at these piecemeal with requiring an annual supplement to
    project cooperation agreements [PCA's] between the Corps and
    the State of New Mexico. I am happy to report that now we have
    moved beyond that and have established programmatic PCA's with
    the State and we are in the process of initiating the
    programmatic NEPA so that these projects can move forward under
    those umbrella agreements.
        Senator Domenici. So, if that reaches fruition, that means
    we will not be doing one project at a time with all the delays,
    but will be qualifying a system.
        General Fuhrman. Yes, sir.
        Senator Domenici. Thank you very much.

                     upper rio grande water operation model

        The Upper Rio Grande water operations model in New Mexico.
    The committee requested a report, in consultation with the
    Bureau, on the progress and plans to complete the Upper Rio
    Grande water operations model. What is the status of this
    report?
        General Fuhrman. That is scheduled for completion in fiscal
    year 2000. We are happy to report that the testing to date has
    been very successful in that model. It is looking good.

                         Additional committee questions

        Senator Domenici. Thank you very much, we have some
    additional questions that you can answer for the record.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                    Questions Submitted by Senator Domenici

                                program overview
        Question. Does the increased budget request of the fiscal year 1999
    request reflect a change in the Administration's attitude toward your
    entire program or just parts of it?
        Answer. This budget request reflects the Administration's concern
    for the preservation of the Nation's infrastructure and environmental
    values. Further, it recognizes the importance of the Nation's ports and
    harbors to America's place in the global economy.
        Question. As and example, how does your budget request treat flood
    control and inland navigation waterway projects compared to last year?
    How much more would these projects cost the taxpayer based on the
    budgeted completion schedules than they would if funded at an efficient
    rate or schedule?
        Answer. The fiscal year 2000 budget request for flood control and
    inland navigation projects is substantially better than last year
    although it does not fund these projects at optimum schedules. For
    fiscal year 1999, the budget request for flood control and inland
    navigation projects was $497,000,000; for fiscal year 2000, the budget
    request for these projects totals $785,000,000. It is not possible to
    conduct a definitive analysis of the delay costs because so many
    assumptions about the future are required, and many of these decisions
    have not yet been made. Let it suffice to say there are costs
    associated with inflation and costs associated with inefficiencies.
        Question. General Ballard, how are completion schedules impacted
    based on the budget request compared to the Corps' most efficient
    schedule?
        Answer. Generally, 28 port development projects and activities are
    funded to meet optimum completion schedules in accordance with the
    proposed Harbor Services User Fee which will cover all construction
    costs. Amounts for 165 flood damage reduction, inland waterways, and
    shore protection projects and activities which rely on general tax
    revenues to finance their construction costs are constrained to a level
    that is about two-thirds of what is needed to maintain optimum
    completion schedules. In addition, 9 high priority projects for
    mitigation, ecosystem restoration, and other purposes are funded to
    meet optimum completion schedules. Specifically, completion dates for
    136 projects and activities would be unchanged from the fiscal year
    2000 budget and completion dates for 66 projects and activities would
    be moved up if projects and activities were funded on their most
    efficient schedules. The average change in the completion dates for
    affected projects would be 5 months.
        Question. What was your request to OMB for the construction
    program, and generally, how would completion schedules be impacted if
    projects were funded at the level requested of OMB?
        Answer. The Army recommended a fiscal year 2000 construction
    program to OMB that totaled $1.815 billion. This program was based on
    completing projects on their most efficient schedules and the impacts
    would be the same those noted previously. This amount was later reduced
    to $1.725 billion after enactment of appropriations for fiscal year
    1999.
        Question. Dr. Westphal, you have indicated that `` * * * the plan
    is to stabilize the Civil Works budget in the future'' by reducing the
    General Investigations program of the Corps of Engineers. You have also
    correctly noted that the study program is the pipeline that feeds the
    Corps' construction effort. What do you mean by ``stabilize'' the
    Corps' budget? Given past history with substantially underfunded budget
    requests, why isn't this another effort to put the Corps of Engineers
    out of business by turning off the ``spigot'' of work that feed the
    construction program?
        Answer. There is a large buildup of ongoing work in this part of
    the Corps program. When you compare the eventual large, future
    construction requirements that these projects will incur with the tight
    budgetary ceilings that we are subject to in the outyears, it is
    prudent to slow down continuing projects and severely limit the number
    of new starts in the General Investigations account, for the time
    being. The nationwide activities such as the floodplain management,
    planning assistance and international water study efforts, provide for
    important, grass roots level support for helping local areas with their
    water resource problems and, therefore, were generally kept at the
    fiscal year 1999 appropriations level funding.
        Question. Dr. Westphal, in a recent statement before the Water
    Resources Subcommittee of the House Transportation and Infrastructure
    Committee you said, ``Once the backlog of costly projects is worked
    down somewhat, then we expect to resume funding for studies at a higher
    level.'' Now this sound strangely similar to statements a few years
    back related to the Bureau of Reclamation's program, when the Secretary
    of the Interior indicated that new construction work would be suspended
    for a few years in order to work off some of their backlog and then
    resume funding at higher levels. Yet, we never seemed to get back to
    some of the traditional work of the Bureau, but have now gotten heavily
    involved in environmental enhancement and other work that is not part
    of the Reclamation mission. What can you tell this subcommittee that
    will lessen our concerns about the future of the Corps' Civil Works
    program, realizing that you and the current Administration will not be
    around if the Corps program is adversely impacted by this approach?
        Answer. My plan is definitely not to go out of the design and
    construction business. The Corps Civil Works mission is very much in
    the business of addressing, evaluating and solving the nations water
    resource infrastructure problems. But this year is still a difficult
    one from the standpoint of the current budgetary situation and choices
    must be made. Consequently, while the program presented is a good one,
    particularly from the Operation & Maintenance and construction
    standpoint, including 20 new construction starts, this is achieved by
    holding back on several items, one of which is General Investigations
    and the outyear commitments that it can create. We need a pause in the
    study program in order to put a sizeable dent in the number of projects
    currently in the construction pipeline. I hope, if all goes well with
    the Corps program in 2000 as well as with the economy and the budget in
    general, that we can resume a higher new start program in the outyears.
                              harbor services fund
        Question. A key component of the President's Budget is a
    legislative proposal to replace the existing Harbor Maintenance Trust
    Fund with a New Harbor Services Fund which would fund the annual
    maintenance and construction requirements for deep draft harbors around
    the country. While maintenance has been accomplished through this sort
    of financing for many years, expanding the program to include
    construction is a step which creates some inequities and imbalances in
    the overall water resources program nationwide.
        For example, the fiscal year 2000 budget for the Corps of Engineers
    would ``fully fund'' the annual needs for deepening deep draft harbors
    at the expense of other activities which again are underfunded and have
    completion schedules that are stretched out.
        Dr. Westphal, what is the rationale for extending the availability
    of the Harbor Services Fund to include construction of deeper
    navigation channels? Why wasn't construction authority provided as part
    of the Harbor Maintenance Trust Fund? What is wrong with the present
    way funding is provided through the general fund of the Treasury for
    deepening projects? What would be the impact if this financing
    mechanism was not approved?
        Answer. The Harbor Services Fund would provide the funds necessary
    to pursue improvements of deep draft ports and channels at the optimum
    level, that is, with no delays due to funding constraints. This
    translates into more work accomplished in less time. The revenue
    targets for the Harbor Services User Fee were calculated to allow this
    to happen without the accrual of large surpluses. Who are the winners?
    The ports, the shippers, the economy.
        Extending the authority of the Harbor Maintenance Trust Fund to
    include construction would not be productive. The Supreme Court ruled
    the Harbor Maintenance Tax unconstitutional on exports in March 1998.
    The tax is still being collected on imports and domestic goods.
    However, a replacement needs to be addressed in a timely manner since
    the tax on imports is under scrutiny as the European Union claims that
    it violates articles of the General Agreement on Tariffs and Trade
    (GATT). While the Administration wants to abolish the tax, it also
    wants to offer an alternative, equitable funding mechanism at the same
    time. That mechanism is the proposed Harbor Services User Fee.
        The realities of the Federal Budget process necessitate looking for
    innovative, equitable ways to ensure funds are available to produce the
    navigation benefits that accrue to ports and shippers. It is good for
    the Nation's business to get navigation benefits on line as quickly as
    we can and at the least cost possible. To do this, a funding source
    other than the General Fund is needed. The Harbor Services User Fee
    will ensure the Army has the resources necessary to meet the growing
    demands of the Nation's ports.
        Because the collection of the Harbor Services User Fee will be
    credited to the Operation and Maintenance, General, and Construction,
    General, accounts as offsetting receipts, the lack of the fee would
    constrain obligation authority within the discretionary caps of the
    Budget Enforcement Act. Under such a constrained program, project work
    likely would not be funded at capability levels, which is what the use
    of the Harbor Services Fund would do. The greatest impacts would be in
    the construction program as project schedules would have to be
    stretched out over time in order to keep total budget authority within
    the discretionary ceilings of the Budget Enforcement Act.
        Question. Since the Nation as a whole benefits from a sound system
    of ports and channels, why should the cost of building and maintaining
    them be placed solely on shippers?
        Answer. While it is true that the Nation's economy benefits from a
    healthy port system, it is also true that our economy allows
    individuals to profit from their industries. User fees charged by the
    Federal Government, for whatever reason, are based on the long-
    established principle that those who benefit from a government-provided
    service may be required to help pay for it. Vessel owners and operators
    are the beneficiaries of the port improvement, operation and
    maintenance activities of the Federal Government. They are good at what
    they do and profit from it. Therefore, it is only fitting that they
    contribute financially to a developed, reliable, safe U.S. port system.
        Another reason for a Harbor Services User Fee addresses an even
    more basic economic issue: the allocation of scarce resources. The
    realities of the Federal Budget process necessitate looking for
    innovative, equitable ways to ensure funds are available to produce the
    navigation benefits that accrue to shippers. It is also good business
    practice to get benefits on line as quickly as we can and at the least
    cost possible. To do this, a funding source other than the General Fund
    is needed. The Harbor Services User Fee will ensure the Army has the
    resources necessary to meet the growing demands of the Nation's ports.
        Question. Is there general agreement and support within the
    shipping community with the approach of the Administration has put
    forth related to the Harbor Services Fund?
        Answer. I believe they are still thinking very hard about the
    proposal. The shippers would pay the users fee and the ports are
    concerned about competitiveness. Last year, I conducted several
    outreach sessions with port representatives and listened carefully to
    their concerns. We have been working the key issues very hard to draft
    a proposal which reaps navigation benefits without placing an
    unreasonable financial burden on the shippers.
        Question. General Ballard, do you perceive any problems with
    financing the construction deepening of ports through this type of
    arrangement? Do you think that this approach will adversely impact the
    construction program? How about the fiscal year 2000 budget request,
    are there any impacts as a result of this proposal, in your judgement?
        Answer. I do not see a problem with financing port deepening
    construction projects from the Harbor Services Fund if legislation is
    enacted to allow this arrangement. It will be similar to the manner in
    which port maintenance requirements have been met in prior years, and
    will provide a reliable funding source so that port deepening projects
    could proceed on their most efficient construction schedules. However,
    non-Federal sponsors of other types of projects will very likely not be
    pleased with this proposal because most other projects which rely on
    general tax revenues to finance their construction will proceed on
    constrained schedules. This situation has created two groups projects
    that are treated differently from one another in the fiscal year 2000
    budget request. It may adversely impact the construction program as the
    groups compete for scarce resources.
        Question. Have any projects had to be delayed or under-funded in
    order to accommodate the port deepening construction? What will these
    delays mean in terms of increased costs and delayed benefits?
        Answer. As I indicated previously, 28 port development projects and
    activities that would be funded from the Harbor Services Fund are
    included in the fiscal year 2000 budget request to meet optimum
    completion schedules. Amounts for 165 flood damage reduction, inland
    waterways, and shore protection projects and activities which rely on
    general tax revenues to finance their construction costs are
    constrained to a level that is about two-thirds of what is needed to
    maintain optimum completion schedules. In addition, 9 high priority
    projects for mitigation, ecosystem restoration, and other purposes are
    funded to meet optimum completion schedules. It is not possible to
    conduct a definitive analysis of the delay costs and delayed benefits
    because so many assumptions about the future are required, and many of
    these decisions have not yet been made. Let it suffice to say there are
    costs associated with inflation, costs associated with inefficiencies,
    and costs associated with forgone benefits.
              fully funded projects budgeted for fiscal year 2000
        Question. General Ballard, could you provide for the record a list
    of all projects that are included in the budget which are ``fully
    funded'' at or near the optimum rate for fiscal year 2000?
        Answer. Yes, I will provide such a list for the record.

                            FISCAL YEAR 2000 ``FULLY FUNDED'' CONSTRUCTION, GENERAL PROJECTS
                                                [In thousands of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                                              2000
                       DIV                                  ST                          PROJECT              BUDGET
    ----------------------------------------------------------------------------------------------------------------
    PO.......................................  AK..........................  CHIGNIK AK..................      4,357
    PO.......................................  AK..........................  COOK INLET, AK..............        500
    PO.......................................  AK..........................  KAKE HARBOR, AK.............      2,568
    PO.......................................  AK..........................  ST. PAUL HARBOR, AK.........        500
    SA.......................................  AL..........................  MOBILE HARBOR, AL...........        700
    SP.......................................  CA..........................  GUADALUPE RIVER, CA.........      5,000
    SP.......................................  CA..........................  HUMBOLDT HARBOR AND BAY, CA.      3,200
    SP.......................................  CA..........................  LOS ANGELES HARBOR CA.......      9,785
    SP.......................................  CA..........................  SANTA BARBARA HARBOR, CA....      4,960
    SA.......................................  FL..........................  CANAVERAL HARBOR DEEPENING,         830
                                                                              FL.
    SA.......................................  FL..........................  CANAVERAL HARBOR, FL........      2,750
    SA.......................................  FL..........................  CENTRAL AND SOUTHERN             52,300
                                                                              FLORIDA, FL.
    SA.......................................  FL..........................  EVERGLADES AND SOUTH FLORIDA     21,100
                                                                              ECOSYSTEM RESTORATION, FL.
    SA.......................................  FL..........................  KISSIMMEE RIVER, FL.........     39,800
    SA.......................................  FL..........................  MANATEE HARBOR, FL..........      4,700
    SA.......................................  FL..........................  MIAMI HARBOR CHANNEL, FL....     15,000
    PO.......................................  HI..........................  KIKIAOLA SMALL BOAT HARBOR,          75
                                                                              KAUAI, HI.
    PO.......................................  HI..........................  MAALAEA HARBOR, MAUI, HI....        272
    LR.......................................  IL..........................  CHICAGO SHORELINE, IL.......      7,629
    MV.......................................  LA..........................  PORT FOURCHON, LA...........      2,184
    NA.......................................  MA..........................  BOSTON HARBOR, MA...........      1,000
    NA.......................................  MD..........................  BALTIMORE HARBOR AND              9,578
                                                                              CHANNELS (BREWERTON
                                                                              CHANNEL), MD.
    SA.......................................  MS..........................  PASCAGOULA HARBOR, MS.......      7,792
    SA.......................................  NC..........................  WILMINGTON HARBOR NC........     18,300
    MV.......................................  ND..........................  DEVILS LAKE ND..............     10,000
    NA.......................................  NJ..........................  DELAWARE RIVER MAIN CHANNEL,     16,500
                                                                              NJ, PA & DE.
    NA.......................................  NJ..........................  NEW YORK HARBOR & ADJACENT        2,000
                                                                              CHNLS, PORT JERSEY CHNL, NJ.
    NA.......................................  NY..........................  KILL VAN KULL AND NEWARK BAY     60,000
                                                                              CHANNEL, NY & NJ.
    NA.......................................  PA..........................  WYOMING VALLEY, PA (LEVEE        20,000
                                                                              RAISING).
    SA.......................................  PR..........................  SAN JUAN HARBOR, PR.........      8,000
    SA.......................................  SC..........................  CHARLESTON HARBOR, SC.......     37,284
    SW.......................................  TX..........................  CHANNEL TO VICTORIA, TX.....      8,700
    SW.......................................  TX..........................  HOUSTON--GALVESTON               60,000
                                                                              NAVIGATION CHANNELS TX.
    NA.......................................  VA..........................  NORFOLK HARBOR AND CHANNELS         550
                                                                              (DEEPENING), VA.
    NW.......................................  WA..........................  COLUMBIA RIVER FISH             100,000
                                                                              MITIGATION, WA, OR & ID.
    XX.......................................  XX..........................  DREDGED MATERIAL DISPOSAL        20,000
                                                                              FACILITIES PROGRAM.
    XX.......................................  XX..........................  RIVERINE ECOSYSTEM               25,000
                                                                              RESTORATION AND FLOOD
                                                                              HAZARD MITIGATION.
    ----------------------------------------------------------------------------------------------------------------

                   fiscal year 2000 construction capabilities
        Question. Also, could you provide for the record a list which shows
    the Corp's construction capability, how the funds would be used, and
    how much the schedule could be advanced with the additional funding?
        Answer. Yes, I will provide the requested list for the record.

                                                   FISCAL YEAR 2000 FUNDING CAPABILITIES CONSTRUCTION PROJECTS
                                                                     (Amounts in Thousands)
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Amounts
    Congressional                                Estimated     included in        Study
      Districts     Project and State    Type    Fed, IWTF,    President's     capability              Purpose of additional capability              Amount
                                                & HMTF cost      budget
    --------------------------------------------------------------------------------------------------------------------------------------------------------
               ALABAMA:
            AL 1   BLACK WARRIOR     (N)           18,900       3,000 (C)       3,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    AND TOMBIGBEE
                    RIVERS,
                    VICINITY OF
                    JACKSON, AL
            AL 1   MOBILE HARBOR,    (N)          305,568         700 (C)         700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    AL
            AL 2   WALTER F GEORGE   (MP)          37,000        750 (MR)        750 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            GA 2    POWERHOUSE AND
                    DAM, AL & GA
                    (MAJOR REHAB)
            AL 2   WALTER F GEORGE   (MP)          30,800      3,600 (MR)      3,600 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            GA 2    POWERPLANT, AL
                    & GA (MAJOR
                    REHAB)
               ALASKA:
                   ALASKA            (E)           25,000             (C)      13,911 (C)  COMPLETE BUCKLAND CONSTRUCTION......................     $8,911
                    ENVIRONMENTAL                                                          INITIATE NOME CONSTRUCTION..........................      5,000
                    INFRASTRUCTURE,                                                        NOTE: THE ADMINISTRATION HAS IDENTIFIED ECONOMIC AND/
                    AK                                                                      OR POLICY CONCERNS.
                                                                                                                                                ------------
                       s                                                                     s                                                      13,911
           AK AL   BETHEL BANK       (FC)      \1\ 18,031             (C)             (C)  FULLY FUNDED........................................  .........
                    STABILIZATION,
                    AK
                   CHIGNIK HARBOR,   (N)        \1\ 5,589       4,357 (C)       4,357 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    AK
           AK AL   COOK INLET, AK    (N)        \1\ 9,450         500 (C)       2,178 (C)  ADVANCE CONSTRUCTION BY 1 YEAR......................  .........
           AK AL   DILLINGHAM        (FC)       \1\ 3,277             (C)             (C)  FULLY FUNDED........................................  .........
                    EMERGENCY BANK                                                         NOTE: THE ADMINISTRATION HAS IDENTIFIED ECONOMIC AND/
                    STABILIZATION,                                                          OR POLICY CONCERNS.
                    AK
           AK AL   HOMER SPIT STORM  (FC)       \1\ 6,600             (C)             (C)  FULLY FUNDED........................................  .........
                    DAMAGE
                    REDUCTION, AK
           AK AL   KAKE HARBOR, AK   (N)       \1\ 18,000       2,568 (C)       2,568 (C)  NO ADDITIONAL REQUIREMENT...........................
                   ST PAUL HARBOR,   (N)       \1\ 14,349         500 (C)       2,500 (C)  ADVANCE COMPLETION OF CONTRACT # 1 BY 6 MO AND            2,000
                    AK                                                                      INITIATE CONTRACT # 2.
               ARIZONA:
            AZ 6   CLIFTON, AZ       (FC)      \1\ 16,100         645 (C)         645 (C)  COMPLETE PROJECT....................................  .........
         AZ 2, 5   NOGALES WASH, AZ  (FC)         \1\ 523             (C)         180 (C)  CONSTRUCT FLOODWARNING SYSTEM.......................  .........
         AZ 2, 5   RILLITO RIVER,    (FC)      \1\ 28,600             (C)       2,643 (C)  COMPLETE PROJECT....................................  .........
                    AZ
               ARKANSAS:
            AR 2   ARKANSAS RIVER,   (FC)         \1\ 418             (C)             (C)  FULLY FUNDED........................................  .........
                    TUCKER CREEK,
                    AR
         AR 2, 3   DARDANELLE LOCK   (MP)      \1\ 29,700     11,964 (MR)     11,964 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    AND DAM
                    POWERHOUSE, AR
                    (MAJOR REHAB)
    AR 1, 2, 3, 4  MCCLELLAN--KERR   (N)      \1\ 632,500       3,080 (C)       3,500 (C)  CONTINUE EVALUATION STUDIES OF CUT-OFF STRUCTURE            420
         OK 2, 3   ARKANSAS RIVER                                                           EROSION.
                   NAVIGATION
                    SYSTEM, AR & OK
         AR 1, 4   MONTGOMERY POINT  (N)      \1\ 242,000      20,000 (C)      45,000 (C)  ADVANCE COMPLETION OF PROJECT ONE YEAR..............     25,000
                    LOCK AND DAM,
                    AR
            AR 4   OUACHITA AND      (N)      \1\ 261,000             (C)             (C)  LACK OF LOCAL COOPERATION...........................  .........
      LA 3, 4, 5    BLACK RIVERS,
                    AR & LA
            AR 3   OZARK             (MP)          44,700            (MR)        500 (MR)  INITIATE REDESIGN OF EXISTING FIVE TURBINES.........        500
                    (POWERHOUSE),
                    AR (MAJOR
                    REHAB)
         AR 2, 4   PLUM BAYOU LEVEE  (FC)           1,700             (C)       1,000 (C)  INITIATE CONSTRUCTION OF PROJECT....................      1,000
                    SYSTEM,                                                                NOTE: THE ADMINISTRATION'S REVIEW RIVER LEVEES, AR
                    ARKANSAS                                                                OF THIS PROJECT HAS IDENTIFIED ECONOMIC AND/OR
                                                                                            POLICY CONCERNS.
        AR 3, 4,   RED RIVER         (N)      \1\ 120,262             (C)       4,000 (C)  CONTINUE CONSTRUCTION CONTRACTS FOR BLACK LAKE,           2,600
            LA 4    EMERGENCY BANK                                                          PLEASANT VALLEY AND HUNTERS ISLAND.
                    PROTECTION, AR                                                         INITIATE DESIGN BOIS D'ARC REVETMENT................      1,000
                    & LA                                                                   CONSTRUCTION MANAGEMENT REVETMENT...................        400
                                                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                                                                                                                                                ------------
                       s                                                                     s                                                       4,000
               CALIFORNIA:
      CA 3, 4, 5   AMERICAN RIVER    (FC)      \1\ 28,510       4,000 (C)       4,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
              11    WATERSHED
                    (NATOMAS), CA
      CA 3, 4, 5   AMERICAN RIVER    (FC)      \1\ 47,600      17,000 (C)      17,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
              11    WATERSHED, CA
            CA 3   CACHE CREEK       (FC)      \1\ 15,740             (C)             (C)  FULLY FUNDED........................................  .........
                    SETTLING BASIN,
                    CA
            CA 6   CORTE MADERA      (FC)          21,700         500 (C)         500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    CREEK, CA
     CA 13,15,16   COYOTE AND        (FC)      \1\ 55,735             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    BERRYESSA
                    CREEKS, CA
            CA 1   CRESCENT CITY     (N)            1,446             (C)             (C)  FULLY FUNDED........................................  .........
                    HARBOR, CA
        CA 15,16   GUADALUPE RIVER,  (FC)      \1\ 78,500       5,000 (C)       5,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    CA
            CA 1   HUMBOLDT HARBOR   (N)           12,300       3,200 (C)       3,200 (C)  COMPLETE PROJECT....................................  .........
                    AND BAY, CA
      CA 21, 22,   LOS ANGELES       (FC)     \1\ 150,000      30,000 (C)      50,000 (C)  INITIATE RELOCATION OF UPRR-COMPTON CREEK BRIDGE....     20,000
     23, 24, 25,    COUNTY DRAINAGE                                                        ADVANCE COMPLETION BY 12 MONTHS.....................
     26, 27, 28,    AREA, CA
     29, 30, 31,
     32, 33, 34,
     37, 38, 39,
              42
     1CA 32, 36,   LOS ANGELES       (N)      \1\ 116,200       9,785 (C)       9,785 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
          38, 42    HARBOR, CA
     CA 2, 3, 5,   LOWER SACRAMENTO  (FC)       \1\ 4,660       2,317 (C)       2,317 (C)  COMPLETE PROJECT....................................  .........
           7, 11    AREA LEVEE
                    RECONSTRUCTION,
                     CA
         CA 2, 3   MARYSVILLE/YUBA   (FC)      \1\ 32,260         300 (C)         300 (C)  COMPLETE PROJECT....................................  .........
                    CITY LEVEE
                    RECONSTRUCTION,
                    CA
       CA 18, 19   MERCED COUNTY     (FC)      \1\ 91,800         500 (C)         500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    STREAMS, CA
     CA 2, 3, 5,   MID-VALLEY AREA   (FC)      \1\ 14,900       4,000 (C)       4,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
           7, 11    LEVEE
                    RECONSTRUCTION,
                    CA
            CA 1   NAPA RIVER, CA    (FC)          91,000       4,500 (C)       4,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
    CA 4, 11, 18   NEW MELONES       (MP)     \1\ 402,000             (C)             (C)  FULLY FUNDED........................................  .........
                    LAKE, CA
           CA 43   NORCO BLUFFS,     (FC)           5,580             (C)             (C)  FULLY FUNDED........................................  .........
                    SANTA ANA
                    RIVER, CA
       CA 36, 38   PORT OF LONG      (N)       \1\ 19,800             (C)             (C)  FULLY FUNDED........................................  .........
                    BEACH
                    (DEEPENING), CA
     CA 2, 3, 5,   SACRAMENTO RIVER  (FC)     \1\ 179,900       7,000 (C)       7,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
           7, 11    BANK PROTECTION
                    PROJECT, CA
            CA 3   SACRAMENTO RIVER  (N)       \1\ 24,900             (C)             (C)  COST SHARING AND FINANCING BY LOCAL INTERESTS ARE
                    DEEPWATER SHIP                                                          UNAVAILABLE.
                    CHANNEL, CA
     CA 2, 3, 5,   SACRAMENTO RIVER  (FC)      \1\ 76,322             (C)             (C)  FULLY FUNDED........................................  .........
           7, 11    FLOOD CONTROL
                    PROJECT, CA
                    (DEF CORR)
         CA 2, 3   SACRAMENTO        (FC)      \1\ 16,550       3,000 (C)       6,000 (C)  ADVANCE PROJECT COMPLETION 6 MONTHS.................  .........
                    RIVER, GLENN-
                    COLUSA
                    IRRIGATION
                    DISTRICT, CA
         CA 3, 5   SACRAMENTO URBAN  (FC)      \1\ 28,215             (C)             (C)  FULLY FUNDED........................................  .........
                    AREA LEVEE
                    RECONSTRUCTION,
                     CA
    CA 3, 7, 10,   SAN FRANCISCO     (N)      \1\ 172,250             (C)             (C)  LACK OF ADEQUATE LOCAL SUPPORT......................  .........
              11    BAY TO
                    STOCKTON, CA
       CA 15, 17   SAN LORENZO       (FC)      \1\ 13,230       4,800 (C)       4,800 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    RIVER, CA
           CA 48   SAN LUIS REY      (FC)      \1\ 61,100             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    RIVER, CA
      CA 39, 40,   SANTA ANA RIVER   (FC)     \1\ 896,000      20,000 (C)      28,000 (C)  INITIATE CONSTRUCTION PRADO DAM.....................      5,000
     41, 42, 43,    MAINSTEM, CA                                                           INITIATE K-RAT MITIGATION...........................      3,000
     44, 45, 46,
              47
                                                                                                                                                ------------
                       s                                                                     s                                                       8,000
           CA 22   SANTA BARBARA     (N)        \1\ 5,360       4,960 (C)       4,960 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, CA
           CA 29   SANTA MONICA      (N)        \1\ 4,660             (C)             (C)  FULLY FUNDED........................................  .........
                    BREAKWATER, CA
           CA 23   ANTA PAULA        (FC)      \1\ 36,000      14,800 (C)      16,195 (C)  COMPLETE PROJECT....................................  .........
                    CREEK, CA
           CA 49   SILVER STRAND     (BE)          15,300             (C)         351 (C)  COMPLETE GRR........................................        351
                    SHORELINE,                                                             NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    IMPERIAL BEACH,                                                         HAS IDENTIFIED POLICY CONCERNS.
                    CA
           CA 20   SUCCESS DAM,      (FC)          30,900      1,250 (DS)      1,250 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
                    TULE RIVER, CA
                    (DAM SAFETY)
       CA 45, 47   SURFSIDE--SUNSET  (BE)          43,200             (C)         400 (C)  INITIATE ENGINEERING & DESIGN FOR PERIODIC                  400
                    -NEWPORT BEACH,                                                         NOURISHMENT.
                    CA
         CA 2, 3   UPPER SACRAMENTO  (FC)       \5\ 5,640       3,055 (C)       3,055 (C)  COMPLETE PROJECT....................................  .........
                    AREA LEVEE
                    RECONSTRUCTION,
                     CA
           CA 10   WALNUT CREEK, CA  (FC)      \1\ 71,930             (C)             (C)  FULLY FUNDED........................................  .........
            CA 3   WEST SACRAMENTO,  (FC)      \1\ 24,700       7,700 (C)       7,700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    CA
            CA 7   WILDCAT AND SAN   (FC)      \1\ 20,200             (C)             (C)  FULLY FUNDED........................................  .........
                    PABLO CREEKS,
                    CA
            CA 3   YOLO BASIN        (E)       \1\ 12,145             (C)             (C)  FULLY FUNDED........................................  .........
                    WETLANDS,
                    SACRAMENTO
                    RIVER, CA
               COLORADO:
            CO 3   ALAMOSA, CO       (FC)       \1\ 5,552             (C)             (C)  FULLY FUNDED........................................  .........
               CONNECTICUT:
            CT 3   FAULKNERS         (FC)           4,500             (C)         582 (C)  COMPLETE PROJECT....................................  .........
                    ISLAND, CT                                                             NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
               DELAWARE:
           DE AL   DELAWARE COAST    (BE)      \1\ 11,800         259 (C)         259 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    PROTECTION, DE
           DE AL   DELAWARE COAST-   (BE)          46,090             (C)         325 (C)  INITIATE CONSTRUCTION THE ADMINISTRATION'S REVIEW OF  .........
                    REHOBOTH TO                                                             THIS PROJECT HAS IDENTIFIED POLICY CONCERNS.
                    DEWEY BCH, DE
               DISTRICT OF
                COLUMBIA:
                   AQUATIC           .......       49,000       4,500 (C)       6,000 (C)  FULLY FUND PROGRAM..................................  .........
                    ECOSYSTEM
                    RESTORATION
                    (SECTION 206
                   AQUATIC PLANT     .......       32,000       3,000 (C)       5,000 (C)  FULLY FUND PROGRAM..................................  .........
                    CONTROL
                   BEACH EROSION     .......       27,600       2,500 (C)       4,000 (C)  FULLY FUND PROGRAM..................................  .........
                    CONTROL
                    PROJECTS
                    (SECTION 103
                   BENEFICIAL USES   .......       10,200       1,000 (C)       2,000 (C)  FULLY FUND PROGRAM..................................  .........
                    OF DREDGED
                    MATERIAL
                    (SECTION  204)
                   DREDGED MATERIAL  .......      248,255      20,000 (C)      20,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    DISPOSAL
                    FACILITIES
                    PROGRAM
                   EMERGENCY         .......      100,000       8,500 (C)      13,000 (C)  FULLY FUND PROGRAM..................................  .........
                    STREAMBANK
                    PROTECTION
                    PROJECTS
                    (SECTION 14)
                   EMPLOYEES         .......      214,197      19,554 (C)      19,554 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    COMPENSATION
                   FLOOD CONTROL     .......      295,500      26,900 (C)      35,000 (C)  FULLY FUND PROGRAM..................................  .........
                    PROJECTS
                    (SECTION 205)
                   INLAND WATERWAYS  .......          750          45 (C)          45 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    USERS BOARD--
                    BOARD EXPENSE
                   INLAND WATERWAYS  .......        2,220         185 (C)         185 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    USERS BOARD--
                    CORPS EXPENSE
                   MITIGATION OF     .......        5,100         500 (C)         500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    SHORE DAMAGES
                    (SECTION 111)
                   MODIFICATIONS     .......      126,475       8,500 (C)      12,000 (C)  FULLY FUND PROGRAM..................................  .........
                    FOR IMPROVEMENT
                    OF ENVIRONMENT
                    (SECTION 1135)
                   NAVIGATION        .......       52,509       4,500 (C)       7,000 (C)  FULLY FUND PROGRAM..................................  .........
                    PROJECTS
                    (SECTION 107)
                   RIVERINE          .......      925,000      25,000 (C)      25,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    ECOSYSTEM
                    RESTORATION AND
                    FLOOD HAZARD
                    MITIGATION
                   SNAGGING AND      .......        1,100         100 (C)         500 (C)  FULLY FUND PROGRAM..................................  .........
                    CLEARING
                    PROJECTS
                    (SECTION 208)
               FLORIDA:
           FL 15   BREVARD COUNTY,   (BE)         154,000             (C)       1,000 (C)  INITIATE NOURISHMENT................................  .........
                    FL                                                                     NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED POLICY CONCERNS.
       FL 11, 15   CANAVERAL HARBOR  (N)            6,600         830 (C)         830 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    DEEPENING, FL
       FL 11, 15   CANAVERAL         (N)          124,470       2,750 (C)       2,750 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, FL
           FL 13   CEDAR HAMMOCK     (FC)          11,600             (C)         238 (C)  INITIATE PROJECT....................................  .........
                    (WARES CREEK)
     FL 5, 6, 8,   CENTRAL AND       (FC)       2,586,300      52,300 (C)      52,300 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
     10, 11, 12,    SOUTHERN
     13, 14, 15,    FLORIDA, FL
     16, 17, 18,
     19, 20, 21,
          22, 23
       FL 18, 22   DADE COUNTY, FL   (BE)         163,300       2,000 (C)       4,000 (C)  COMPLETE RENOURISHMENT OF BAL HARBOUR, AWARD TEST     .........
                                                                                            BEACH FILL CONTRACT.
    FL 7, 8, 12,   EVERGLADES AND    (E)           75,000      21,100 (C)      21,100 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
     14, 16, 17,    SOUTH FLORIDA
     18, 19, 20,    ECOSYSTEM
          21, 22    RESTORATION, FL
           FL 12   FORT PIERCE       (BE)          28,000             (C)         500 (C)  CONTINU PROJECT.....................................  .........
                    BEACH, FLO                                                             NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED POLICY CONCERNS.
           FL 11   INDIAN RIVER      (BE)     ...........             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    COUNTY, FL
    FL 3, 4, 11,   INTRACOASTAL      (N)            1,085             (C)         400 (C)  INITIATE PROJECT....................................  .........
     12, 14, 15,    WATERWAY, PALM
     16, 17, 18,    BEACH COUNTY,
      19, 22, 23    FL
            AL 2   JIM WOODRUFF      (MP)          35,600      6,000 (MR)      6,000 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            FL 2    LOCK AND DAM
            GA 2    POWERHOUSE, FL
                    & GA (MAJOR
                    REHAB)
    FL 5, 8, 10,   KISSIMMEE RIVER,  (E)          243,500      39,800 (C)      39,800 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
    11,12,15, 16    FL
           FL 22   LAKE WORTH INLET  (N)            4,500             (C)       1,000 (C)  INITIATE PROJECT....................................  .........
                    SAND TRANSFER
                    PLANT
           FL 14   LEE COUNTY, FL    (BE)           8,900             (C)         185 (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    (REIMBURSEMENT)
           FL 13   MANATEE HARBOR,   (N)           19,885       4,700 (C)       4,700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    FL
    FL 10, 12, 16  MARTIN COUNTY,    (BE)          25,600             (C)         213 (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    FL
       FL 18, 22   MIAMI HARBOR      (N)           47,566      15,000 (C)      15,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    CHANNEL, FL
            FL 4   PALM VALLEY       (N)           18,700       3,000 (C)       5,000 (C)  ADVANCE PROJECT COMPLETION 1 YEAR...................  .........
                    BRIDGE, FL
            FL 1   PANAMA CITY       (BE)          22,905             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........
                    BEACHES, FL
         FL 8, 9   PINELLAS COUNTY,  (BE)         144,600       2,000 (C)       3,476 (C)  RENOURISH SAND KEY & TREASURE ISLAND................  .........
                    FL
            FL 4   ST. JOHNS COUNTY  (BE)         153,400             (C)         300 (C)  COMPLETE DESIGN.....................................  .........
                    (ST. AUGUSTINE                                                         NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    BEACHES), FL                                                            HAS IDENTIFIED POLICY CONCERNS.
           FL 11   TAMPA HARBOR--    (N)            6,932             (C)       1,000 (C)  INITIATE PROJECT....................................  .........
                    BIG BEND
               GEORGIA:
            GA 9   BUFORD            (MP)          32,900      3,650 (MR)      3,650 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    POWERHOUSE, GA
                    (MAJOR REHAB)
           GA 11   HARTWELL LAKE     (MP)      \1\ 20,800      1,500 (MR)      1,500 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            SC 3    POWERHOUSE, GA
                    & SC (MAJOR
                    REHAB)
            GA 1   LOWER SAVANNAH    (N)        \1\ 3,196             (C)         200 (C)  INITIATE PROJECT....................................  .........
            SC 2    RIVER BASIN, GA
                    & SC
           GA 10   RICHARD B         (MP)     \1\ 618,100       8,500 (C)       8,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
            SC 3    RUSSELL DAM AND
                    LAKE, GA & SC
           GA 10   THURMOND LAKE     (MP)      \1\ 69,700      8,000 (MR)      8,000 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            SC 3    POWERHOUSE, GA
                    & SC (MAJOR
                    REHAB)
            GA 1   TYBEE ISLAND, GA  (BE)      \1\ 17,244             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
               HAWAII:
            HI 2   IAO STREAM FLOOD  (FC)      \1\ 14,297         219 (C)         340 (C)  ADVANCE COMPLETION OF GENERAL DESIGN MEMORANDUM BY 6  .........
                    CONTROL, MAUI,                                                          MONTHS.
                    HI (DEF CORR)
            HI 2   KIKIAOLA SMALL    (N)        \1\ 4,997          75 (C)          75 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    BOAT HARBOR,
                    KAUAI, HI
            HI 2   MAALAEA HARBOR,   (N)       \1\ 11,329         272 (C)         272 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    MAUI, HI
               ILLINOIS:
       IL 12, 20   ALTON TO GALE     (FC)         109,018             (C)             (C)  COST SHARING AND FINANCING BY LOCAL INTERESTS ARE     .........
            MO 8    ORGANIZED LEVEE                                                         UNLIKELY.
                    DISTRICT, IL &
                    MO (DEF CORR)
           IL 12   CHAIN OF ROCKS    (N)       \1\ 24,500       1,600 (C)       2,200 (C)  COMPLETE PLACEMENT OF RIPRAP IN IN DRAINAGE DITCH           600
                    CANAL,                                                                  ADVANCES PROJECT COMPLETION BY THREE MONTHS.
                    MISSISSIPPI
                    RIVER, IL (DEF
                    CORR)
           IL 13   CHICAGO SANITARY  (E)        \1\ 2,000         100 (C)         600 (C)  COMPLETE DESIGN AND INITIATE CONSTRUCTION OF PHASE          500
                    AND SHIP CANAL                                                          II.
                    DISPERSAL
                    BARRIER, IL
     IL 1, 2, 5,   CHICAGO           (BE)     \1\ 169,100       7,629 (C)      18,629 (C)  ADVANCE CONSTRUCTION REACH 2 (IRVING TO BELMONT)....      2,000
            7, 9    SHORELINE, IL                                                          ADVANCE CONSTRUCTION REACH 4 (I-55 TO 30TH  ST).....      1,300
                                                                                           ADVANCE CONSTRUCTION REACH 4 (33RD ST TO 37TH ST)...
                                                                                           INITIATE CONSTRUCTION REACH 4 (37TH ST TO 43RD ST)..      4,000
                                                                                           CONSTRUCTION MANAGEMENT.............................      3,000
                                                                                                                                                       700
                                                                                                                                                ------------
                       s                                                                     s                                                      11,000
    IL 8, 10, 12   DES PLAINES       (FC)       \1\ 2,200             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    WETLANDS
                    DEMONSTRATION
                    PROJECT, IL
           IL 12   EAST ST LOUIS &   (FC)           1,369             (C)         488 (C)  COMPLETE GENERAL REEVALUATION REPORT................        488
                    VICINITY                                                               NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    (INTERIOR FLOOD                                                         HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    CONTROL), IL
           IL 12   EAST ST LOUIS,    (FC)      \1\ 32,335       2,000 (C)       2,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    IL
           IL 20   LOCK AND DAM 24   (N)       \1\ 25,000      3,844 (MR)      3,844 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            MO 9    PART 1, MISS
                    RIVER, IL & MO
                    (MAJOR REHAB)
           IL 20   LOCK AND DAM 24   (N)       \1\ 38,400      1,200 (MR)      1,200 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            MO 9    PART 2, MISS
                    RIVER, IL & MO
                    (MAJOR REHAB)
           IL 20   LOCK AND DAM 25,  (N)       \1\ 25,900      4,456 (MR)      4,456 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
            MO 9    MISSISSIPPI
                    RIVER, IL & MO
                    (MAJOR REHAB)
           IL 16   LOVES PARK, IL    (FC)      \1\ 22,500       3,888 (C)       3,888 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
     IL 1, 2, 3,   MCCOOK AND        (FC)     \1\ 490,000       2,500 (C)       4,500 (C)  ADVANCE COMPLETION OF GROUNDWATER PROTECTION SYSTEM.  .........
     4, 5, 6, 7,    THORNTON
    8, 9, 10, 13    RESERVOIRS, IL
       IL 12, 20   MELVIN PRICE      (N)      \1\ 740,700       2,900 (C)       4,000 (C)  ADVANCE CONTRACT FOR PUBLIC ACCESS FACILITIES BY 36       1,100
            MO 2    LOCK AND DAM,                                                           MONTHS SUBJECT TO COMPLETION OF 215 AGREEMENT.
                    IL &  MO
       IL 12, 20   MELVIN PRICE      (N)      \1\ 215,000             (C)             (C)  FULLY FUNDED........................................  .........
            MO 2    LOCK AND DAM,
                    SECOND LOCK, IL
                    & MO
    IL 9, 10, 11   NORTH BRANCH      (FC)      \1\ 21,735             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    CHICAGO RIVER,
                    IL
     IL 3, 5, 6,   O'HARE            (FC)      \1\ 31,377             (C)             (C)  FULLY FUNDED........................................  .........
     8, 9,10, 13    RESERVOIR, IL
           IL 19   OLMSTED LOCKS     (N)      \1\ 1,020,0      28,634 (C)      51,000 (C)  ADVANCE PROJECT COMPLETION BY 12 MONTHS.............     22,366
            KY 1    AND DAM, OHIO                      00
                    RIVER, IL & KY
     IA 1, 2, 3,   UPPER MISS RVR    (E)      \1\ 242,862      18,955 (C)      18,955 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
            4, 5    SYSTEM ENV MGMT
      IL 16, 17,    PROGRAM, IL,
          18, 20    IA, MO, MN & WI
     MN 1, 2, 3,
         4, 5, 6
     MO 1, 2, 4,
         6, 8, 9
     WI 1, 2, 3,
     4, 5, 6, 7,
            8, 9
               INDIANA:
            IN 4   FORT WAYNE        (FC)      \1\ 37,021       4,000 (C)       4,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    METROPOLITAN
                    AREA, IN
            IN 1   INDIANA           (BE)     \1\ 184,000             (C)          40 (C)  CONTINUE MONITORING PROGRAM.........................         40
                    SHORELINE                                                              NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    EROSION, IN                                                             HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
        IN 9, 10   INDIANAPOLIS      (FC)      \1\ 39,975             (C)      10,991 (C)  CONTINUE PROJECT....................................     10,991
                    CENTRAL                                                                NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    WATERFRONT,                                                             HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    WHITE RIVER, IN
     IN 6, 7, 10   INDIANAPOLIS,     (FC)      \1\ 11,837             (C)       1,588 (C)  INITIATE CONSTRUCTION...............................      1,588
                    WHITE RIVER
                    (NORTH), IN
            IN 1   LAKE GEORGE,      (FC)        \1\6,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    HOBART, IN
            IN 1   LITTLE CALUMET    (FC)     \1\ 131,618       3,900 (C)       9,400 (C)  ADVANCE CONSTRUCTION ON STAGE IV-1..................      3,600
                    RIVER, IN                                                              COMPLETE BURR STREET LEVEE..........................        500
                                                                                           INITIATE PUMP STATION 1A............................      1,000
                                                                                           CONSTRUCTION MANAGEMENT.............................        400
                                                                                                                                                ------------
                       s                                                                     s                                                       5,500
         IN 8, 9   NEW HARMONY, IN   (FC)       \1\ 2,455             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                                                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            IN 9   OHIO RIVER        (N)       \1\ 18,000             (C)         500 (C)  INITIATE PROJECT....................................        500
                    (GREENWAY                                                              NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    CORRIDOR), IN                                                           HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
         IN 8, 9   OHIO RIVER FLOOD  (FC)       \1\ 4,378             (C)       1,318 (C)  COMPLETE PROJECT....................................      1,318
                    PROTECTION, IN                                                         NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
         IN 8, 9   PATOKA LAKE, IN   (FC)       \1\ 7,200      2,000 (MR)      3,500 (MR)  ADVANCE PROJECT COMPLETION THREE MONTHS.............      1,500
                    (MAJOR REHAB)
               IOWA:
      IA 3, 4, 5   DES MOINES        (FC)      \1\ 28,000             (C)       6,600 (C)  AWARD LUMP-SUM CONTRACT FOR RED ROCK TRAILS, SEG          4,550
                    RECREATION                                                              IVB;.
                    RIVER AND                                                              CONTINUE P,E&D FOR 11 PROJECTS;.....................      1,430
                    GREENBELT, IA                                                          CONTINUE SUPERVISON AND INSPECTION..................        370
                                                                                           CONTINUE PROGRAM MGT. AND ADVISORY COMMITTEE                250
                                                                                            ACTIVITIES.
                                                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                                                                                                                                                ------------
                       s                                                                     s                                                       6,600
                   LOCK AND DAM 12,  (N)       \1\ 15,500      2,600 (MR)      2,600 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    MISSISSIPPI
                    RIVER, IA
                    (MAJOR REHAB)
            IA 1   LOCK AND DAM 14,  (N)       \1\ 20,000      4,092 (MR)      4,092 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
           IL 17    MISSISSIPPI
                    RIVER, IA
                    (MAJOR REHAB)
         IA 4, 5   MISSOURI RIVER    (E)       \1\ 81,400       5,000 (C)      10,000 (C)  ADVANCE COMPLETION OF CONSTRUCTION AT VARIOUS SITES   .........
         KS 2, 3    FISH AND                                                                BY SIX MONTHS. ADVANCE PROJECT COMPLETION BY SIX
     MO 1, 2, 4,    WILDLIFE                                                                MONTHS.
         5, 6, 9    MITIGATION, IA,
      NE 1, 2, 3    NE, KS & MO
         IA 4, 5   MISSOURI RIVER    (FC)     \1\ 139,193       3,000 (C)       3,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
         KS 2, 3    LEVEE SYSTEM,
     MO 1, 2, 4,    IA, NE, KS & MO
         5, 6, 9
      NE 1, 2, 3
            IA 1   MUSCATINE         (FC)       \1\ 6,820       2,500 (C)       2,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    ISLAND, IA
            IA 5   PERRY CREEK, IA   (FC)      \1\ 42,580       9,500 (C)       9,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
         IA 3, 4   RED ROCK DAM AND  (FC)      \1\ 44,500             (C)         400 (C)  CONTINUE REAL ESTATE ACQUISITION ACTIVITIES.........        400
                    LAKE RED ROCK,                                                         NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    IA                                                                      HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            IA 4   WEST DES MOINES,  (FC)      \1\ 12,996             (C)             (C)  FULLY FUNDED........................................  .........
                    DES MOINES, IA
               KANSAS:
            KS 4   ARKANSAS CITY,    (FC)      \1\ 27,400       4,300 (C)       4,300 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    KS
            KS 4   WINFIELD, KS      (FC)       \1\ 6,600         154 (C)         154 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
               KENTUCKY:
            KY 1   BARKLEY DAM AND   (MP)     \1\ 159,799       1,450 (C)       2,750 (C)  ADVANCE PROJECT COMPLETION 12 MONTHS................      1,300
         TN 7, 8    LAKE BARKLEY,
                    KY & TN
            KY 5   DEWEY LAKE, KY    (FC)      \1\ 13,700      2,500 (DS)      4,900 (DS)  ADVANCE PROJECT COMPLETION BY 12 MONTHS.............      2,400
                    (DAM SAFETY)
         AL 4, 5   KENTUCKY LOCK     (N)      \1\ 533,000       7,750 (C)      15,000 (C)  ADVANCE PROJECT COMPLETION 9 MONTHS.................      7,250
         KY 1, 5    AND DAM,
            MS 1    TENNESSEE
     TN 2, 3, 4,    RIVER, KY
      5, 6, 7, 8
            IN 9   MCALPINE LOCKS    (N)      \1\ 268,000       2,800 (C)      10,800 (C)  ADVANCE AWARD OF PHASE I LOCK CONSTRUCTION 24             8,000
            KY 3    AND DAM, OHIO                                                           MONTHS; AWARD BOAT MOORING CONTRACT; ADVANCE
                    RIVER, KY & IN                                                          PROJECT COMPLETION BY 24 MONTHS.
         KY 3, 4   METROPOLITAN      (FC)      \1\ 12,115       3,251 (C)       3,251 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    LOUISVILLE,
                    POND CREEK, KY
            KY 5   SALYERSVILLE, KY  (FC)       \1\ 8,630             (C)             (C)  FULLY FUNDED........................................  .........
         KY 4, 5   SOUTHERN AND      (E)       \1\ 10,000             (C)       2,000 (C)  INCREASE COMMUNITY PARTICIPATION IN PROGRAM.........  .........
                    EASTERN
                    KENTUCKY
         KY 2, 6   TAYLORSVILLE      (FC)      \1\ 92,980             (C)             (C)  FULLY FUNDED EXCEPT FOR UNPROGRAMMED RECREATION       .........
                    LAKE, KY                                                                FACILITIES.
               LOUISIANA:
         LA 5, 6   ALOHA--RIGOLETTE  (FC)       \1\ 7,078         581 (C)         581 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    , LA
      LA 1, 4, 6   COMITE RIVER, LA  (FC)      \1\ 82,700       4,000 (C)       4,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
            LA 3   GRAND ISLE AND    (FC)      \1\ 36,547             (C)             (C)  ENGINEERING AND DESIGN WILL CONTINUE WITH AVAILABLE
                    VICINITY, LA                                                            FUNDS.
      LA 1, 2, 3   INNER HARBOR      (N)      \1\ 533,000      13,000 (C)      15,900 (C)  INITIATE DEMOLITION OF EASTSIDE BUSINESS............        500
                    NAVIGATION                                                             ADVANCE ENGINEERING AND DESIGN......................      2,400
                    CANAL LOCK, LA
                                                                                                                                                ------------
                       s                                                                     s                                                       2,900
      LA 1, 2, 3   LAKE              (FC)     \1\ 520,000      11,887 (C)      27,046 (C)  PARALLEL PROTECTION:
                    PONTCHARTRAIN                                                            COMPLETE LONDON, SIMON-LONDON.....................        151
                    AND VICINITY,                                                            COMPLETE GENTILLY.................................        383
                    LA (HURRICANE                                                            COMPLETE ORLEANS, PHASE 1C........................      1,200
                    PROTECTION)                                                              COMPLETE LONDON PUMPING STATION # 4...............      3,320
                                                                                             COMPLETE LONDON PUMPING STATION # 3...............      6,150
                                                                                             INITIATE ORLEANS PHASE 1B LEE & LONDON............        100
                                                                                             INITIATE MIRABEAU AND FILMORE.....................      2,516
                                                                                             CONTINUE ENGINEERING AND DESIGN AND CONSTRUCTION        1,339
                                                                                            MANAGMENT.
                                                                                             NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                                                                                                                                                ------------
                                                                                                                                                    15,159
         LA 1, 2   LAKE              (E)       \1\ 22,800             (C)         500 (C)  COMPLETE PROJECT....................................  .........
                    PONTCHARTRAIN                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    STORMWATER                                                              HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    DISCHARGE, LA
         LA 2, 3   LAROSE TO GOLDEN  (FC)      \1\ 80,000       2,000 (C)       2,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    MEADOW, LA
                    (HURRICANE
                    PROTECTION)
     LA 1, 2, 3,   MISSISSIPPI       (N)      \1\ 171,000       1,500 (C)       1,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
            4, 6    RIVER SHIP
                    CHANNEL, GULF
                    TO BATON ROUGE,
                    LA
      LA 1, 2, 3   NEW ORLEANS TO    (FC)     \1\ 171,000       1,400 (C)       2,000 (C)  ADVANCE INITIATION OF ONE CONSTRUCTION CONTRACT BY          600
                    VENICE, LA                                                              12 MONTHS.
                    (HURRICANE
                    PROTEC-  TION)
      LA 4, 5, 6   OUACHITA RIVER    (FC)          29,500             (C)       3,300 (C)  INITIATE CONTINUING CONTRACTS FOR LEVEE ITEM 2,           3,300
                    LEVEES, LA                                                              GRAVEL SURFACING FOR MONROE TO SANDY BAYOU AND
                                                                                            INITIATE P&S FOR ITEM 3.
                                                                                           NOTE: THE ADMINISTRATIOIN'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            LA 3   PORT FOURCHON,    (N)            2,557       2,184 (C)       2,184 (C)  COMPLETE PROJECT....................................  .........
                    LA
         AR 3, 4   RED RIVER BELOW   (FC)      \1\ 83,069             (C)         600 (C)  INITIATE CONTINUING CONTRACTS TO CONSTRUCT LEVEE            400
         LA 4, 5    DENISON DAM,                                                            ITEMS 5 & 9A.
            TX 1    LA, AR & TX                                                            INITIATE DESIGN OF LEVEE ITEM 6.....................        100
                                                                                           CONSTRUCTION MANAGEMENT.............................        100
                                                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                                                                                                                                                ------------
                       s                                                                     s                                                         600
      LA 4, 5, 6   RED RIVER         (N)        1,895,691      21,113 (C)      23,613 (C)  ACCELERATE INITIATION:
                    WATERWAY,                                                                COGNAC REINFORCEMENT DIKES........................      1,250
                    MISSISSIPPI                                                              POISSON ACS.......................................      1,000
                    RIVER TO                                                                 CONSTRUCTION MANAGEMENT...........................        250
                    SHREVEPORT, LA
                                                                                                                                                ------------
                       s                                                                     s                                                       2,500
         LA 1, 2   SOUTHEAST         (FC)     \1\ 374,000      47,066 (C)     100,000 (C)  JEFFERSON PARISH:
                    LOUISIANA, LA                                                            COMPLETE 17 CONTRACTS.............................     28,448
                                                                                             CONTINUE 7 CONTRACTS..............................      4,230
                                                                                             ENGINEERING AND DESIGN............................         50
                                                                                             SUPERVISION AND ADMINISTRATION....................      4,386
                                                                                           ORLEANS PARISH:
                                                                                             COMPLETE 2 CONTRACTS..............................      6,463
                                                                                             CONTINUE 4 CONTRACTS..............................      8,154
                                                                                             SUPERVISION AND ADMINISTRATION....................      1,203
                                                                                                                                                ------------
                       s                                                                     s                                                      52,934
      LA 1, 2, 3   WEST BANK         (FC)         192,000       7,000 (C)      15,070 (C)  WESTWEGO TO HARVEY CANAL AREA:
                    VICINITY OF NEW                                                          ADVANCE INITIATION OF REACH 3 STRUCTURES (MT              852
                    ORLEANS, LA                                                             KENNEDY/AMES/OAK COVE FLOODWALLS) CONTRACT BY 6
                                                                                            MONTHS.
                                                                                             ADVANCE INITIATION OF ESTELLE PUMPING STATION TO          283
                                                                                            LP&L 2ND LIFT CONTRACT BY 7 YEARS.
                                                                                           WEST OF ALGIERS:
                                                                                             ADVANCE INITIAION OF ALGIERS LOCK TO BELLE CHASSE       1,606
                                                                                            HWY (ORLEANS LEVEE # 9) BY 8 YEARS.
                                                                                             ADVANCE INITIATION OF ALGIERS LOCK TO BELLE CHASSE      3,804
                                                                                            HWY TO CUTOFF (PLAQ LEVEE # 8) BY 8 YEARS.
                                                                                           EAST OF ALGIERS:
                                                                                             ADVANCE INITIAION OF ALGIERS LOCK TO BELLE CHASSE         387
                                                                                            HWY TO HERO LEVEE (PLAQ LEVEE # 11) BY 8 YEARS.
                                                                                             ADVANCE INITIATION OF ALGIERS LOCK TO BELLE CHASSE        500
                                                                                            HWY (ORLEANS LEVEE # 12) BY 9 YEARS.
                                                                                           LAKE CATAOUATCHE AREA: ADVANCE ENGINEERING AND              638
                                                                                            DESIGN.
                                                                                                                                                ------------
                       s                                                                     s                                                       8,070
               MAINE:
            ME 2   ST JOHN RIVER I-  (FC)           3,432             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    C DEMO PROJECT
               MARYLAND:
           DC DE   ANACOSTIA RIVER   (E)           12,000       4,031 (C)       4,031 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
      MD 4, 5, 8    AND
                    TRIBUTARIES, MD
                    & DC
            MD 1   ASSATEAGUE        (BE)      \1\ 16,900             (C)       6,200 (C)  INITIATE CONSTRUCTION...............................  .........
                    ISLAND, MD
            MD 1   ATLANTIC COAST    (BE)     \1\ 270,300         200 (C)         200 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    OF MARYLAND, MD
    MD 1, 2, 3, 4  BALTIMORE HARBOR  (N)           44,521       9,578 (C)       9,578 (C)  COMPLETE PROJECT....................................  .........
            VA 1    AND CHANNELS
                    (BREWERTON
                    CHANNEL), MD
            MD 1   CHESAPEAKE BAY    (E)       \1\ 10,000             (C)         210 (C)  DESIGN WORK ON SMITH ISLAND WSTWTR TREATMENT PL. &    .........
            VA 1    ENVIRONMENTAL                                                           NORFOLK DIST. PROJ.
                    PROGRAM, MD, VA                                                        NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    & PA                                                                    HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            MD 1   CHESAPEAKE BAY    (E)            2,500         559 (C)         559 (C)  COMPLETE PROJECT....................................  .........
                    OYSTER
                    RECOVERY, MD
            MD 6   CUMBERLAND, MD    (FC)      \1\ 27,584             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
            WV 1    AND RIDGELEY,                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    WV                                                                      HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
           VA 11   NEABSCO CREEK,    .......    \1\ 1,125             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    VA
            MD 1   POPLAR ISLAND,    (E)      \1\ 320,000       9,502 (C)      16,000 (C)  INITIATE FIRST DREDGED MATERIAL PLACEMENT PROJECT...  .........
                    MD
               MASSACHUSETTS:
     MA 8, 9, 10   BOSTON HARBOR,    (N)       \1\ 12,150       1,000 (C)       1,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    MA
           MA 10   CAPE COD CANAL    (N)       \1\ 30,500      5,000 (MR)      5,000 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    RAILROAD
                    BRIDGE, MA
                    (MAJOR REHAB)
            MA 2   HODGES VILLAGE    (FC)      \1\ 18,600      3,257 (MR)      3,257 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    DAM, MA (MAJOR
                    REHAB)
            MA 7   REVERE BEACH, MA  (BE)           6,825             (C)             (C)  PERIODIC NOURISHMENT NOT CURRENTLY REQUIRED.........  .........
            MA 7   ROUGHANS POINT,   (FC)       \1\ 8,000             (C)             (C)  FULLY FUNDED........................................  .........
                    REVERE, MA
        MA 9, 10   TOWN BROOK,       (FC)      \1\ 30,600       1,500 (C)       1,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    QUINCY AND
                    BRAINTREE, MA
               MICHIGAN:
            MI 1   GREAT LAKES       (N)       \1\ 11,254             (C)         500 (C)  INITIATE CONSTRUCTION UPPER ST MARYS RIVER (VIDAL           500
            MN 8    CONNECTING                                                              SHOALS). CHANNEL DEEPENING.
            WI 7    CHANNELS AND
                    HARBORS, MI,
                    MN, & WI
               MINNESOTA:
            MN 2   CHASKA, MN        (FC)      \1\ 30,397             (C)             (C)  FULLY FUNDED........................................  .........
            MN 1   LOCK AND DAM 3,   (N)       \1\ 15,400      3,200 (MR)      5,000 (MR)  ADVANCE PROJECT COMPLETION 6 MONTHS.................  .........
                    MISSISSIPPI
                    RIVER, MN
                    (MAJOR REHAB)
            MN 2   MARSHALL, MN      (FC)       \1\ 7,850       2,275 (C)       3,275 (C)  ADVANCE PROJECT COMPLETION 9 MONTHS.................  .........
            MN 8   PINE RIVER DAM,   (N)        \1\ 9,820      3,390 (DS)      3,390 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
                    CROSS LAKE, MN
                    (DAM SAFETY)
            MN 1   ROCHESTER, MN     (FC)      \1\ 67,210             (C)             (C)  FULLY FUNDED........................................  .........
            MN 6   STILLWATER, MN    (BE)       \1\ 8,700             (C)       1,158 (C)  COMPLETE STAGE 2 CONSTRUCTION.......................  .........
                                                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
               MISSISSIPPI:
            LA 1   EAST PEARL,       (E)        \1\ 4,000             (C)             (C)  FULLY FUNDED........................................  .........
    MS 2, 3, 4, 5   WALKIAH BLUFF--
                    BG155
            MS 5   JACKSON COUNTY    (FC)          10,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    INDUSTRIAL
                    WATER SUPPLY,
                    MS
            MS 4   NATCHEZ BLUFF,    (FC)      \1\ 13,039             (C)         500 (C)  CONTINUING CONSTRUCTION OF MADISON STREET TO STATE          500
                    MS                                                                      STREET.
                                                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            MS 5   PASCAGOULA        (N)           39,041       7,792 (C)       7,792 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, MS
      AL 1, 4, 7   TENNESSEE--TOMBI  (N)           91,800             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
      MS 1, 3, 5    GBEE WATERWAY
                    WILDLIFE
                    MITIGATION, AL
                    & MS
            MS 5   WOLF AND JORDAN   (N)            2,943             (C)       1,000 (C)  INITIATE PROJECT....................................  .........
                    RIVERS MS
               MISSOURI:
            MO 5   BLUE RIVER        (FC)     \1\ 211,000      13,700 (C)      13,700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    CHANNEL, KANSAS
                    CITY, MO
            MO 8   CAPE GIRARDEAU,   (FC)      \1\ 36,293       1,900 (C)       1,900 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    JACKSON, MO
            MO 9   LONG BRANCH       (FC)          20,288             (C)             (C)  FULLY FUNDED EXCEPT FOR UNPROGRAMMED RECREATION       .........
                    LAKE, MO                                                                FACILITIES.
            MO 2   MERAMEC RIVER     (FC)      \1\ 28,030       3,500 (C)       3,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    BASIN, VALLEY
                    PARK LEVEE, MO
       IL 12, 20   MISS RIVER BTWN   (N)       \1\274,000       3,000 (C)       4,650 (C)  ADVANCE INITIATION OF THE CHESTER REACH CONTRACT BY         600
      MO 1, 3, 8    THE OHIO AND MO                                                         SEVEN MONTHS.
                    RIVERS (REG                                                            INITIATE AND COMPLETE PLANS AND SPECIFICATIONS FOR          450
                    WORKS), MO & IL                                                         DEVILS ISLAND AND ELIZA PT/GREENFIELD (PH 2).
                                                                                           INITIATE PLANS AND SPECIFICATIONS FOR IVORY LANDING.        100
                                                                                           CONTINUE REGIONAL ENGINEERING AND ENVIRONMENTAL             250
                                                                                            GEOSPATIAL INFORMATION SYSTEM (REEGIS).
                                                                                           CONTINUE ESSENTIAL DATA COLLECTION ADVANCE PROJECT          250
                                                                                            COMPLETION BY 6 MONTHS.
                                                                                                                                                ------------
                       s                                                                     s                                                       1,650
         MO 3, 8   STE GENEVIEVE,    (FC)      \1\ 36,100       7,000 (C)      10,000 (C)  ADVANCE COMPLETION OF PUMP STATION/GRAVITY DRAIN BY       1,000
                    MO                                                                      6 MONTHS.
                                                                                           ADVANCE COMPLETION OF LEVEE/DITCHING/GRADING              2,000
                                                                                            CONTRACT BY 12 MONTHS. ADVANCE PROJECT COMPLETION
                                                                                            BY 4 MTHS.
                                                                                                                                                ------------
                       s                                                                     s                                                       3,000
            AR 3   TABLE ROCK LAKE,  (MP)      \1\ 60,200     13,000 (DS)     13,000 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
            MO 7    MO & AR (DAM
                    SAFETY)
               MONTANA:
           MT AL   FLATHEAD RIVER,   (FC)              90             (C)             (C)  FULLY FUNDED........................................  .........
                    MT
               NEBRASKA:
            NE 1   MISSOURI          (FC)      \1\ 21,000         300 (C)         300 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
           SD AL    NATIONAL
                    RECREATIONAL
                    RIVER, NE & SD
         NE 1, 3   WOOD RIVER,       (FC)      \1\ 10,000         100 (C)         100 (C)  NO ADDITIONAL REQUIREMENT...........................
                    GRAND ISLAND,
                    NE
               NEVADA:
         NV 1, 2   TROPICANA AND     (FC)     \1\ 208,500      20,100 (C)      35,000 (C)  COMPLETE CONSTRUCTION OF LOWER FLA-MINGO DIVERSION       14,900
                    FLAMINGO                                                                CHANNEL AND INITIATE AND COMPLETE CONSTRUCTION OF F-
                    WASHES, NV                                                              1 DEBRIS BASIN ADVANCE PROJECT COMPLETION 12 MONTHS.
           NJ 13   ARTHUR KILL       (N)          216,000             (C)             (C)  PROJECT REQUIRES REAUTHORIZATION....................  .........
           NY 13    CHANNEL,
                    HOWLAND HOOK
                    MARINE
                    TERMINAL, NY &
                    NJ
         NJ 2, 3   BRIGANTINE TO     (FC)         329,000             (C)       7,000 (C)  INITIATE CONSTRUCTION...............................  .........
                    GREAT EGG                                                              NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    (ABSECON)                                                               HAS IDENTIFIED POLICY CONCERNS.
            NJ 2   CAPE MAY INLET    (BE)      \1\ 87,700       1,700 (C)       1,700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    TO LOWER
                    TOWNSHIP, NJ
           DE AL   DELAWARE RIVER    (N)      \1\ 214,000      16,500 (C)      16,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
     NJ 1, 2, 4,    MAIN CHANNEL,
       5, 12, 13    NJ, PA & DE
     PA 1, 2, 3,
    7, 8, 10, 15
            NJ 2   GREAT EGG HARBOR  (BE)     \1\ 358,800         419 (C)         419 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    INLET AND PECK
                    BEACH, NJ
            NJ 9   HACKENSACK        (FC)          12,500             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    MEADOWLANDS, NJ                                                        NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONERNS.
    NJ 5, 8, 10,   JOSEPH G MINISH   (FC)          33,705             (C)       8,000 (C)  CONTINUE CONSTRUCTION.NOTE: THE ADMINISTRATION'S
          11, 13    HISTORIC                                                                REVIEW OF THIS PROJECT HAS IDENTIFIED ECONOMIC AND/
                    WATERFRONT                                                              OR POLICY CONCERNS.
                    PARK,NJ
       NJ 10, 13   LIBERTY STATE     (FC)          19,150             (C)             (C)  FULLY FUNDED........................................  .........
                    PARK LEVEE AND
                    SEAWALL, NJ
         NJ 5, 8   MOLLY ANN'S       (FC)      \1\ 20,600             (C)             (C)  FULLY FUNDED........................................  .........
                    BROOK AT
                    HALEDON,
                    PROSPECT PARK
                    AND PATERSON,
                    NJ
           NJ 13   NEW YORK HARBOR   (N)           72,100       2,000 (C)       2,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    & ADJACENT
                    CHANNELS, PORT
                    JERSEY CHANNEL,
                    NJ
           NJ 11   PASSAIC RIVER     (FC)          18,300       1,800 (C)       1,800 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    PRESERVATION OF
                    NATURAL STORAGE
                    AREAS, NJ
            NJ 5   RAMAPO AND        (FC)           6,530             (C)             (C)  COST SHARING AND FINANCING BY LOCAL INTERESTS ARE     .........
           NY 22    MAHWAH RIVERS,                                                          UNAVAILABLE.
                    MAHWAH, NJ AND
                    SUFFERN, NY
         NJ 5, 8   RAMAPO RIVER AT   (FC)      \1\ 11,240       1,300 (C)       1,300 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    OAKLAND, NJ
         NJ 3, 6   RARITAN BAY AND   (BE)          30,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    SANDY HOOK BAY,                                                        NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    NJ                                                                      HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
     NJ 6, 7, 12   RARITAN RIVER     (FC)     \1\ 286,000       1,000 (C)       1,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    BASIN, GREEN
                    BROOK SUB-
                    BASIN, NJ
         NJ 3, 6   SANDY HOOK TO     (BE)     \1\ 979,000       9,000 (C)       9,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    BARNEGAT INLET,
                    NJ
               NEW MEXICO:
            NM 3   ABIQUIU DAM       (FC)       \1\ 7,000             (C)             (C)  FULLY FUNDED........................................  .........
                    EMERGENCY
                    GATES, NM
      NM 1, 2, 3   ACEQUIAS          (FC)      \1\ 66,000       1,500 (C)       1,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    IRRIGATION
                    SYSTEM, NM
            NM 2   ALAMOGORDO, NM    (FC)      \1\ 41,400         700 (C)         700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
            NM 3   GALISTEO DAM, NM  (FC)       \1\ 3,990            (DS)            (DS)  FULLY FUNDED........................................  .........
                    (DAM SAFETY)
            NM 2   LAS CRUCES, NM    (FC)       \1\ 6,600       2,400 (C)       2,400 (C)  COMPLETE PROJECT....................................  .........
         NM 1, 3   MIDDLE RIO        (FC)      \1\ 46,800         600 (C)         600 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    GRANDE FLOOD
                    PROTECTION,
                    BERNALILLO TO
                    BELEN, NM
            NM 2   RIO GRANDE        (FC)      \1\ 62,300         600 (C)         600 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    FLOODWAY, SAN
                    ACACIA TO
                    BOSQUE DEL
                    APACHE, NM
            NM 2   TWO RIVERS DAM,   (FC)       \1\ 1,932            (DS)            (DS)  FULLY FUNDED........................................  .........
                    NM (DAM SAFETY)
               NEW YORK:
        NY 9, 13   ATLANTIC COAST    (BE)      \1\ 91,000         300 (C)         300 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    OF NYC,
                    ROCKAWAY INLET
                    TO NORTON
                    POINT, NY
    NY 6, 10, 16   EAST ROCKAWAY     (BE)      \1\ 63,000       3,320 (C)       3,320 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    INLET TO
                    ROCKAWAY INLET
                    AND JAMAICA
                    BAY, NY
         NY 1, 2   FIRE ISLAND       (BE)     \1\ 532,000       3,000 (C)       3,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    INLET TO JONES
                    INLET, NY
            NY 1   FIRE ISLAND       (BE)     \1\ 571,400       3,250 (C)       3,750 (C)  INITIATE CONSTRUCTION OF WEST OF SHINNECOCK INLET     .........
                    INLET TO                                                                ELEMENT.
                    MONTAUK POINT,                                                         NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    NY                                                                      HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERN'S.
           NY 22   HUDSON RIVER, NY  (N)           12,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    (NEW YORK CITY                                                         NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    TO WATERFORD-                                                           HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    ATHENS CHANNEL)
        NJ 7, 10   KILL VAN KULL     (N)      \1\ 823,300      60,000 (C)      60,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
       NY 13, 14    AND NEWARK BAY
                    CHANNEL, NY &
                    NJ
      NY 3, 4, 5   LONG BEACH        (BE)         239,500             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    ISLAND, NY
            NY 1   MORICHES INLET,   (N)        \1\ 9,100             (C)             (C)  FULLY FUNDED........................................  .........
                    NY
    NY 8, 18, 23,  NEW YORK CITY     (E)           22,500             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
              26    WATERSHED, NY                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND /OR POLICY CONCERNS.
     NJ 6, 9, 13   NEW YORK HARBOR   (N)      \1\ 131,661             (C)             (C)  FULLY FUNDED........................................  .........
    NY 7, 8, 11,    COLLECTION AND
     12, 13, 14,    REMOVAL OF
              15    DRIFT, NY & NJ
           NY 25   NEW YORK STATE    (N)        \1\ 8,000             (C)       4,200 (C)  REIMBURSE PROJECTS COMPLETED BY NYS BARGE CANAL CORP      4,200
                    CANAL SYSTEM,                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    NY                                                                      HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
           NY 26   NORTH             (FC)       \1\ 3,194             (C)             (C)  FULLY FUNDED........................................  .........
                    ELLENVILLE, NY
                    (DEF CORR)
           NY 25   ONONDAGA LAKE     (FC)       \1\ 4,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    STORM WATER
                    DISCHARGE, NY
       NY 16, 18   ORCHARD BEACH,    (BE)           5,200             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    NY                                                                     NOTE: THE ADMINISTRATION'S REVIEW OF THIS STUDY HAS
                                                                                            IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            NY 1   SHINNECOCK        (N)       \1\ 16,900             (C)             (C)  FULLY FUNDED........................................  .........
                    INLET, NY
       NY 17, 18   YONKERS, NY (DEF  (FC)      \1\ 13,529             (C)             (C)  FULLY FUNDED........................................  .........
                    CORR)
               NORTH CAROLINA:
            NC 3   AIWW,             (N)           70,700       7,000 (C)       7,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    REPLACEMENT OF
                    FEDERAL HIGHWAY
                    BRIDGES, NC
            NC 4   B EVERETT JORDAN  (FC)         147,557             (C)             (C)  FULLY FUNDED........................................  .........
                    DAM AND LAKE,
                    NC
            NC 7   BRUNSWICK COUNTY  (BE)          73,800             (C)         200 (C)  INITIATE CONSTRUCTION...............................  .........
                    BEACHES, NC--                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    OCEAN ISLE                                                              HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    BEACH PORTION
            NC 7   CAROLINA BEACH    (BE)         163,780             (C)             (C)  PERIODIC NOURISHMENT NOT CURRENTLY REQUIRED.........  .........
                    AND VICINITY,
                    NC
         NC 2, 4   FALLS LAKE, NC    (FC)         183,000             (C)             (C)  FULLY FUNDED........................................  .........
            NC 8   HAMLET CITY       (FC)           3,200             (C)             (C)  FULLY FUNDED........................................  .........
                    LAKE, NC
            NC 7   WILMINGTON        (N)          247,100      18,300 (C)      18,300 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, NC
            NC 7   WRIGHTSVILLE      (BE)          25,200             (C)             (C)  PERIODIC NOURISHMENT NOT CURRENTLY REQUIRED.........  .........
                    BEACH, NC
               NORTH DAKOTA:
           ND AL   BUFORD-TRENTON    (FC)      \1\ 40,000       5,000 (C)      10,000 (C)  ACQUIRE ADDITIONAL EASEMENTS FROM WILLING SELL-  ERS      5,000
                    IRRIGATION
                    DISTRICT LAND
                    ACQUISITION, ND
           ND AL   DEVILS LAKE       (FC)      \1\ 29,000      10,000 (C)      10,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    EMERGENCY
                    OUTLET, ND
           ND AL   FT YATES BRIDGE,  (MP)          40,577             (C)             (C)  CURRENT FUNDS ARE ADAQUATE MAJOR ACTIVITIES ON THIS   .........
                    ND                                                                      PROJECT HAVE CURTAILED PENDING EXECUTION OF A MOA
                                                                                            WITH THE STANDING ROCK SIOUX TRIBE.
           ND AL   GARRISON DAM AND  (MP)      \1\ 37,000      6,500 (MR)      6,500 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    POWER PLANT, ND
                    (MAJOR REHAB)
            MN 7   GRAND FORKS, ND-- (FC)     \1\ 175,900      10,000 (C)      10,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
           ND AL    EAST GRAND
                    FORKS, MN
           ND AL   HOMME LAKE, ND    (FC)      \1\ 16,000      3,000 (DS)      3,000 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
                    (DAM SAFE-  TY)
           ND AL   LAKE ASHTABULA    (FC)      \1\ 14,700            (DS)            (DS)  FULLY FUNDED........................................  .........
                    AND BALDHILL
                    DAM, ND (DAM
                    SAFETY)
           ND AL   LAKE ASHTABULA    (FC)       \1\ 7,800        500 (MR)      1,535 (MR)  ADVANCE PROJECT COMPLETION 12 MONTHS................  .........
                    AND BALDHILL
                    DAM, ND (MAJOR
                    REHAB)
           ND AL   SHEYENNE RIVER,   (FC)      \1\ 30,610             (C)       1,700 (C)  INITIATE CONSTRUCTION OF BALDHILL DAM POOL RAISE      .........
                    ND                                                                      SEPERABLE ELEMENT.
           ND AL   SOURIS RIVER, ND  (FC)     \1\ 101,387             (C)             (C)  FULLY FUNDED........................................  .........
               OHIO:
       OH 16, 18   BEACH CITY LAKE,  (FC)       \1\ 3,500      1,400 (DS)      1,400 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
                    MUSKINGUM RIVER
                    LAKES, OH (DAM
                    SAFETY)
         OH 3, 6   HOLES CREEK,      (FC)       \1\ 3,896             (C)             (C)  FULLY FUNDED........................................  .........
                    WEST
                    CARROLLTON, OH
    OH 13, 17, 19  LOWER GIRARD      (FC)       \1\ 1,593             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
            PA 4    LAKE, OH
            OH 9   MAUMEE BAY STATE  (BE)       \1\ 8,317             (C)             (C)  PERIODIC NOURISHMENT NOT CURRENTLY REQUIRED.........  .........
                    PARK, OH
         OH 1, 2   METROPOLITAN      (FC)      \1\ 13,035       2,266 (C)       4,000 (C)  ADVANCE PROJECT COMPLETION BY 6 MONTHS..............      1,734
                    REGION OF
                    CINCINNATI,
                    DUCK CREEK, OH
         OH 1, 2   MILL CREEK, OH    (FC)     \1\ 163,000         915 (C)         915 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
        OH 12,15   WEST COLUMBUS,    (FC)      \1\ 91,700       8,000 (C)      16,000 (C)  ADVANCE PROJECT COMPLETION BY 12 MONTHS.............      8,000
                    OH
               OKLAHOMA:
         OK 1, 2   MINGO CREEK,      (FC)          75,400             (C)             (C)  FULLY FUNDED........................................  .........
                    TULSA, OK
            TX 4   RED RIVER         (N)          \1\ 400             (C)         275 (C)  CONTINUE SEDIMENTATION STUDY........................        275
                    EMERGENGY BANK                                                         NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    PROTECTION, AR                                                          HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    & LA
         OK 1, 2   SKIATOOK LAKE,    (FC)       \1\ 9,800        500 (DS)        500 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
                    OK (DAM SAFETY)
            OK 2   TENKILLER FERRY   (MP)      \1\ 37,900      6,800 (DS)      6,800 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
                    LAKE, OK (DAM
                    SAFETY)
               OREGON:
            ID 1   BONNEVILLE        (N)      \1\ 336,298             (C)             (C)  FULLY FUNDED........................................  .........
           MT AL    NAVIGATION
    OR 1, 2, 3, 5   LOCK, OR & WA
    WA 3, 4, 5, 6
         OR 2, 3   BONNEVILLE        (MP)      \1\ 24,267            (MR)            (MR)  FULLY FUNDED........................................  .........
            WA 4    POWERHOUSE
                    PHASE I, OR &
                    WA (MAJOR
                    REHAB)
         OR 2, 3   BONNEVILLE        (MP)     \1\ 104,600     10,800 (MR)     16,300 (MR)  ADVANCE PROJECT COMPLETION ONE YEAR (1) FROM              5,500
            WA 4    POWERHOUSE                                                              SEPTEMBER 2009 TO SEPTEMBER 2008.
                    PHASE II, OR &
                    WA (MAJOR
                    REHAB)
         OR 2, 3   BONNEVILLE        (MP)     \1\ 678,707             (C)             (C)  FULLY FUNDED........................................  .........
            WA 4    SECOND
                    POWERHOUSE, OR
                    & WA
         OR 2, 3   COLUMBIA RIVER    (MP)      \1\ 73,966       6,368 (C)       6,368 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
         WA 3, 4    TREATY FISHING
                    ACCESS SITES,
                    OR & WA
            OR 1   COLUMBIA RIVER,   (N)          \1\ 150             (C)             (C)  FULLY FUNDED........................................  .........
                    SEAFARERS
                    MEMORIAL,
                    HAMMOND, OR
            OR 2   ELK CREEK LAKE,   (FC)         174,000         500 (C)       7,000 (C)  ACCOMPLISH PASSIVE FISH PASSAGE CORRIDOR IN FISCAL        6,500
                    OR                                                                      YEAR 2000.
         OR 1, 3   LOWER COLUMBIA    (FC)          28,000         262 (C)         617 (C)  PREPARE PLANS AND SPECIFICATIONS FOR BARLOW POINT            90
            WA 3    RIVER BASIN                                                             SITE.
                    BANK                                                                   PREPARE P&S FOR COLUMBIA SLOUGH SITE................        100
                    PROTECTION, OR                                                         PREPARE DECISION DOCUMENT ON OTHER SITES............        165
                    & WA
                                                                                                                                                ------------
                       s                                                                     s                                                         355
    OR 1, 3, 4, 5  WILLAMETTE RIVER  (FC)          33,300             (C)         118 (C)  PROVIDE DESIGN, PREPARE PLANS AND SPECIFICATIONS,           118
                    BASIN BANK                                                              AND CONSTRUCT THE SHADY DELL SITE.
                    PROTECTION, OR
            OR 4   WILLAMETTE RIVER  (FC)      \1\ 70,600       1,700 (C)       3,500 (C)  INITIATE DIVERSION WORK.............................        500
                    TEMPERATURE                                                            COMPLETE P & S FOR INTAKE TOWER.....................      1,000
                    CONTROL, OR                                                            GATE FABRICATION....................................        300
                                                                                                                                                ------------
                       s                                                                     s                                                       1,800
               PENNSYLVANIA:
            PA 9   BROAD TOP         (FC)       \1\ 5,500             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    REGION, PA                                                             NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJEC HAS
                                                                                            IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            PA 3   GLEN FOERD, PA    (FC)       \1\ 1,110             (C)             (C)  FULLY FUNDED........................................  .........
           PA 12   JOHNSTOWN, PA     (FC)      \1\ 32,664      6,800 (MR)      6,800 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    (MAJOR REHAB)
           PA 10   LACKAWANNA        (FC)       \1\ 9,839             (C)             (C)  FULLY FUNDED........................................  .........
                    RIVER,
                    OLYPHANT, PA
           PA 10   LACKAWANNA        (FC)      \1\ 47,575             (C)             (C)  FULLY FUNDED........................................  .........
                    RIVER,
                    SCRANTON, PA
       PA 18, 20   LOCKS AND DAMS    (N)      \1\ 705,000      21,600 (C)      53,078 (C)  ADVANCE PROJECT COMPLETION BY 12 MONTHS.............     31,478
                    2, 3 AND 4,
                    MONONGAHELA
                    RIVER,  PA
           PA 21   PRESQUE ISLE      (BE)      \1\ 58,085         520 (C)         520 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    PENINSULA, PA
                    (PERMANENT)
           PA 14   SAW MILL RUN,     (FC)      \1\ 10,575       3,500 (C)       3,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    PITTSBURGH, PA
                   SCHUYLKILL RIVER  (FC)           2,700             (C)       2,625 (C)  CONTINUE CONSTRUCTION...............................  .........
                    PARK,                                                                  NOTE: THE ADMINISTRATION'S REVIEW PA OF THIS PROJECT
                    PHILADELPHIA,                                                           HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    PA
           PA 12   SOUTH CENTRAL PA  (E)       \1\ 36,750             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    ENVIRONMENTAL                                                          NOTE: THE ADMINISTRATIONS REVIEW OF THIS PROJECT HAS
                    IMPROVEMENT,                                                            IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    PA
    PA 9, 10, 12   SOUTH CENTRAL PA  (E)       \1\ 44,650             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    ENVIRONMENTAL                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    IMPROVEMENT,                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    PA
            PA 3   SOUTHEASTERN      (FC)          25,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    ENV. ASSIS.                                                            NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    EAST CENTRAL                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    INCINERATOR
                    SITE
            PA 6   SUNBURY, PA       (FC)      \1\ 18,063             (C)             (C)  LACK OF LOCAL COOPERATION...........................  .........
           PA 11   SUSQUEHANNA       (E)        \1\ 2,000             (C)             (C)  LACK OF LOCAL COOPERATION...........................  .........
                    RIVER, PA
           PA 12   WEST VIRGINIA     (FC)      \1\ 12,000             (C)       2,000 (C)  CONTINUE DPR FOR WV PROJECTS........................      2,000
            WV 1    AND                                                                    NOTE: THE ADMINISTRATIONS REVIEW OF THIS PROJECT HAS
                    PENNSYLVANIA                                                            IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    FLOOD CONTROL,
                    PA & WV
           PA 10   WILLIAMSPORT, PA  (FC)      \1\ 13,190             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
           PA 11   WYOMING VALLEY,   (FC)     \1\ 108,300      20,000 (C)      20,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    PA (LEVEE
                    RAISING)
               PUERTO RICO:
           PR DE   ARECIBO RIVER,    (FC)          12,500       2,500 (C)       2,500 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    PR
           PR DE   PORTUGUES AND     (FC)         430,300       5,434 (C)       5,434 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    BUCANA RIVERS,
                    PR
           PR DE   RIO DE LA PLATA,  (FC)          63,300       1,000 (C)       3,000 (C)  INITIATE CONTRACT FOR FLOOD PROTECTION WORKS FROM     .........
                    PR                                                                      RIVER MOUTH TO DORADO ADVANCE PROJECT COMPLETION 6
                                                                                            MONTHS.
           PR DE   RIO GRANDE DE     (FC)         138,300             (C)         500 (C)  INITIATE PROJECT....................................  .........
                    LOIZA, PR
           PR DE   RIO PUERTO        (FC)         321,000       9,566 (C)       9,566 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    NUEVO, PR
           PR DE   SAN JUAN HARBOR,  (N)           24,100       8,000 (C)       8,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    PR
               RHODE ISLAND:
            RI 1   ALLENDALE DAM,    (FC)             300             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    RI                                                                     NOTE: THE ADMINSTRATION'S REVIEW OF THIS PROJECT HAS
                                                                                            IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            RI 2   NARRAGANSETT      (N)            1,425             (C)             (C)  COST SHARING AND FINANCING BY LOCAL INTERESTS ARE     .........
                    TOWN BEACH,                                                             UNAVAILABLE.
                    NARRAGANSETT,
                    RI
            RI 2   QUONSET POINT-    (FC)           2,400             (C)             (C)  FULLY FUNDED........................................  .........
                    DAVISVILLE, RI
         RI 1, 2   SEEKONK RIVER,    (N)          \1\ 700             (C)             (C)  FULLY FUNDED........................................  .........
                    PROVIDENCE, RI
               SOUTH CAROLINA:
            SC 1   CHARLESTON        (N)           98,444      37,284 (C)      37,284 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, SC
                    (DEEPENING &
                    WIDENING)
            SC 1   FOLLY BEACH, SC   (BE)          98,689             (C)             (C)  PERIODIC NOURISHMENT NOT CURRENTLY REQUIRED.........  .........
            SC 1   MYRTLE BEACH, SC  (BE)         140,535             (C)             (C)  PERIODIC NOURISHMENT NOT CURRENTLY REQUIRED.........  .........
               SOUTH DAKOTA:
           SD AL   BIG SIOUX RIVER,  (FC)          27,975             (C)         150 (C)  COMPLETE OPTIMIZATION STUDY, CHUTE/STILLING BASIN           150
                    SIOUX FALLS, SD                                                         DESIGN, AND P&S.
           SD AL   CHEYENNE RIVER    (E)          108,000       2,000 (C)       3,000 (C)  ACCELERATE REAL ESTATE ACTIVITIES...................      1,000
                    SIOUX TRIBE,
                    LOWER BRULE
                    SIOUX, SD
           SD AL   PIERRE, SD        (MP)         100,000      10,000 (C)      10,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
               TENNESSEE:
            TN 6   BLACK FOX,        (E)        \1\ 6,817             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    MURFREE AND
                    OAKLANDS
                    SPRINGS
                    WETLANDS, TN
            TN 3   EAST RIDGE,       (FC)      \1\ 18,750             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    HAMILTON CO.,TN
            TN 3   TENNESSEE RIVER,  (FC)       \1\ 6,669             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    HAMILTON
                    COUNTY, TN
               TEXAS:
    TX 7, 18, 22,  BRAYS BAYOU,      (FC)     \1\ 293,010       9,800 (C)       9,800 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
              25    HOUSTON, TX
           TX 14   CHANNEL TO        (N)       \1\ 26,820       8,700 (C)       8,700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    VICTORIA, TX
    TX 9, 22, 25   CLEAR CREEK, TX   (FC)      \1\ 75,830       3,200 (C)       3,200 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
         TX 7, 8   CYPRESS CREEK,    (FC)       \1\ 9,848             (C)       4,569 (C)  INITIATE & COMPLETE CONSTRUCTION....................      4,569
                    HOUSTON, TX
    TX 5, 24, 26,  DALLAS FLOODWAY   (FC)         112,150             (C)             (C)  PROJECT REQUIRES ADDITIONAL AUTHORIZATION...........  .........
              30    EXTENSION,
                    TRINITY RIVER
                    PROJECT, TX
           TX 16   EL PASO, TX       (FC)     \1\ 116,300       6,200 (C)       6,200 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
       TX 11, 14   GIWW, ARANSAS     (N)       \1\ 20,660       9,000 (C)       9,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    NATIONAL
                    WILDLIFE
                    REFUGE, TX
    TX 8, 9, 18,   HOUSTON--GALVEST  (N)      \1\ 415,543      60,000 (C)      60,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
          25, 29    ON NAVIGATION
                    CHANNELS, TX
    TX 6, 24, 26   JOE POOL LAKE,    (FC)     \1\ 227,000             (C)      26,700 (C)  REIMBURSE JUDGEMENT FUND............................     26,700
                    TX
           TX 13   MCGRATH CREEK,    (FC)          11,050             (C)             (C)  FULLY FUNDED........................................  .........
                    WICHITA FALLS,
                    TX
     TX 2, 9, 11   NECHES RIVER AND  (N)       \1\ 41,895       2,000 (C)       2,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    TRIBUTARIES
                    SALTWATER
                    BARRIER, TX
    AR 1, 2, 3, 4  RED RIVER BASIN   (FC)      \1\ 88,422             (C)       2,100 (C)  CONTINUE PROJECT....................................  .........
         LA 4, 5    CHLORIDE                                                               NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
    OK 2, 3, 4, 6   CONTROL, TX &                                                           HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
    TX 1, 4, 13,    OK
      17, 19, 26
         AR 1, 2   RED RIVER         (FC)     \1\ 318,600             (C)       5,500 (C)  CONTINUE PROJECT....................................      5,500
            LA 5    WATERWAY, TX,                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
            OK 3    AR, OK, LA                                                              HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
         TX 1, 4    (INDEX AR TO
                    DENISON DAM, TX
      TX 20, 21,   SAN ANTONIO       (FC)     \1\ 153,100         610 (C)         610 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
          23, 28    CHANNEL
                    IMPROVEMENT, TX
      TX 18, 22,   SIMS BAYOU,       (FC)     \1\ 214,320      18,300 (C)      18,300 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
          25, 29    HOUSTON, TX
         TX 2, 9   WALLISVILLE       (N)       \1\ 78,000             (C)       4,756 (C)  COMPLETE PROJECT....................................      4,756
                    LAKE, TX                                                               NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
               UTAH:
            UT 2   LITTLE DELL       (FC)      \1\ 41,215             (C)             (C)  FULLY FUNDED........................................  .........
                    LAKE, UT
            UT 2   UPPER JORDAN      (FC)       \1\ 9,660             (C)             (C)  FULLY FUNDED........................................  .........
                    RIVER, UT
               VIRGINIA:
            VA 4   AIWW, BRIDGE AT   (N)       \1\ 23,100       3,000 (C)       5,000 (C)  ADVANCE PROJECT COMPLETION BY 24 MONTHS.............  .........
                    GREAT BRIDGE,
                    VA
            VA 6   JAMES R OLIN      (FC)      \1\ 34,800             (C)             (C)  FULLY FUNDED........................................  .........
                    FLOOD CONTROL
                    PROJECT, VA
            VA 5   JOHN H KERR DAM   (MP)          59,600      1,400 (MR)      1,400 (MR)  NO ADDITIONAL REQUIREMENT...........................  .........
                    AND RESERVOIR,
                    VA & NC (MAJOR
                    REHAB)
            VA 5   LYNCHBURG, VA     (FC)          20,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    (COMBINED SEWER                                                        NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    OVERFLOW)                                                               HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
      VA 1, 2, 4   NORFOLK HARBOR    (N)      \1\ 137,496         550 (C)         550 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    AND CHANNELS
                    (DEEPENING), VA
         VA 3, 7   RICHMOND          (FC)           8,100             (C)             (C)  FULLY FUNDED........................................  .........
                    FILTRATION
                    PLANT, VA
            VA 7   RICHMOND LOCAL    (FC)         105,153             (C)             (C)  FULLY FUNDED........................................  .........
                    PROTECTION
                    PROJECT, VA
         VA 3, 7   RICHMOND, VA      (FC)          20,000             (C)      10,000 (C)  CONTINUE CONSTRUCTION OF RETENTION TUNNEL...........  .........
                    (COMBINED SEWER                                                        NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    OVERFLOW)                                                               HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            VA 6   ROANOKE RIVER     (FC)          28,800       1,197 (C)       1,197 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    UPPER BASIN,
                    HEADWATERS
                    AREA, VA
            VA 2   VIRGINIA BEACH,   (BE)     \1\ 247,300             (C)      26,600 (C)  CONTINUE CONSTRUCTION...............................  .........
                    VA (HURRICANE                                                          NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    PROTECTION)                                                             HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            VA 2   VIRGINIA BEACH,   (BE)      \1\ 27,658             (C)       1,400 (C)  CONTINUE PROJECT....................................  .........
                    VA                                                                     NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    (REIMBURSEMENT)                                                         HAS IDENTIFIED POLICY CONCERNS.
               WASHINGTON:
            ID 1   COLUMBIA RIVER    (E)        1,376,330     100,000 (C)     100,000 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
            OR 2    FISH
         WA 4, 5    MITIGATION, WA,
                    OR & ID
         WA 3, 6   GRAYS HARBOR, WA  (N)           18,507             (C)         450 (C)  COMPLETE FINAL CRAB MITIGATION AND CLOSE OUT THE      .........
                                                                                            PROJECT.
         ID 1, 2   LOWER SNAKE       (E)          232,000       1,300 (C)       1,800 (C)  PROVIDE ADDITIONAL WILDLIFE LAND DEVELOPMENT........        500
            OR 2    RIVER FISH &
         WA 4, 5    WILDLIFE
                    COMPENSATION,
                    WA, OR & ID
         WA 3, 4   MT ST HELENS      (FC)         195,800         540 (C)         540 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    SEDIMENT
                    CONTROL, WA
         WA 8, 9   MUD MOUNTAIN      (FC)          68,717            (DS)            (DS)  FULLY FUNDED........................................  .........
                    DAM, WA (DAM
                    SAFETY)
            OR 2   THE DALLES        (MP)      \1\ 94,000      2,300 (MR)      3,300 (MR)  PROCURE WINDINGS....................................      1,000
            WA 4    POWERHOUSE
                    (UNITS 1-14, WA
                    & OR (MAJOR
                    REHAB)
               WEST VIRGINIA:
            WV 3   BLUESTONE LAKE,   (FC)     \1\ 107,300        750 (DS)      4,200 (DS)  ADVANCE PROJECT COMPLETION BY 12 MONTHS.............      3,450
                    WV (DAM SAFETY)
            WV 3   GREENBRIER RIVER  (FC)      \1\ 12,000             (C)       1,000 (C)  CONTINUE DETAILED DESIGN............................      1,000
                    BASIN, WV                                                              NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
         KY 4, 5   LEVISA AND TUG    (FC)     \1\ 1,837,8       5,400 (C)      23,100 (C)  CONTINUE LOWER MINGO CO, WV N/S.....................      1,300
            VA 9    FORKS AND UPPER                    41                                  CONTINUE PIKE CO, KY N/S............................      1,100
            WV 3    CUMBERLAND                                                             CONTINUE MARTIN CO, KY, N/S.........................        900
                    RIVER, WV, VA &                                                        CONTINUE UPPER MINGO CO, WV N/S.....................        600
                    KY                                                                     CONTINUE WAYNE CO, WV N/S...........................        300
                                                                                           CONTINUE MCDOWELL CO, WV N/S........................      2,200
                                                                                           CONTINUE BUCHANAN CO, VA DPR........................        800
                                                                                           INITIATE PIKE CO, KY TRIB DPR.......................        500
                                                                                           CONTINUE HARLAN, KY.................................      1,500
                                                                                           CONTINUE MIDDLESBOROUGH, KY.........................      5,000
                                                                                           CONTINUE CLOVER FORK, KY N/S........................      3,000
                                                                                           INIT PLAN--3QTR--TOWN OF MARTIN,KY..................        500
                                                                                           N/S: THE ADMINISTRATION'S REVIEW OF THIS PROJECT HAS
                                                                                            IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                                                                                                                                                ------------
                       s                                                                     s                                                      17,700
            WV 2   LONDON LOCKS AND  (N)       \1\ 20,300        600 (MR)      1,400 (MR)  ADVANCE PROJECT COMPLETION BY 12 MONTHS.............        800
                    DAM, KANAWHA
                    RIVER, WV
                    (MAJOR REHAB)
            WV 2   MARMET LOCK,      (N)      \1\ 294,000       9,800 (C)      11,350 (C)  ADVANCE PROJECT COMPLETION BY 6 MONTHS..............      1,550
                    KANAWHA RIVER,
                    WV
            WV 2   MOOREFIELD, WV    (FC)      \1\ 20,494             (C)             (C)  FULLY FUNDED........................................  .........
            WV 2   PETERSBURG, WV    (FC)      \1\ 19,711             (C)             (C)  FULLY FUNDED........................................  .........
            OH 6   ROBERT C BYRD     (N)      \1\ 363,474       7,150 (C)       9,300 (C)  COMPLETE BANK STABILIZATION.........................      2,150
         WV 2, 3    LOCKS AND DAM,
                    OHIO RIVER, WV
                    & OH
            WV 3   SOUTHERN WV       (E)       \1\ 20,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    ENVIRONMENTAL
                    INFRASTRUCTURE
                    PROGRAM, WV
            WV 2   STONEWALL         (FC)     \1\ 231,000             (C)             (C)  FULLY FUNDED EXCEPT FOR UNPROGRAMMED RECREATION       .........
                    JACKSON LAKE,                                                           FACILITIES.
                    WV
            WV 1   TYGART LAKE, WV   (FC)       \1\ 7,500      2,900 (DS)      2,900 (DS)  NO ADDITIONAL REQUIREMENT...........................  .........
                    (DAM SAFETY)
            PA 9   WEST VIRGINIA     (FC)       \1\ 4,000             (C)             (C)  PROJECT WILL CONTINUE WITH AVAILABLE FUNDS..........  .........
                    AND                                                                    NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                    PENNSYLVANIA                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                    FLOOD CONTROL,
                    WV & PA
            WV 2   WINFIELD LOCKS    (N)      \1\ 227,400       1,400 (C)       3,200 (C)  ADVANCE PROJECT COMPLETION BY 24 MONTHS.............      1,800
                    AND DAM,
                    KANAWHA RIVER,
                    WV
               WISCONSIN:
            WI 3   LAFARGE LAKE &    (FC)      \1\ 17,000             (C)       3,000 (C)  CONTINUE ACTIVITIES IN SUPPORT OF PROJECT LAND        .........
                    CHANNEL IMPRV,                                                          TRANSFER AND DEAUTHORIZATION.
                    WI 1962 ACT                                                            NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
            WI 2   PORTAGE, WI       (FC)       \1\ 7,666             (C)             (C)  FULLY FUNDED........................................  .........

    --------------------------------------------------------------------------------------------------------------------------------------------------------
               NOTE: ALTHOUGH PROJECT AND STUDY CAPABILITIES REFLECT THE READINESS OF THE WORK FOR ACCOMPLISHMENT, THEY ARE IN COMPETITION FOR AVAILABLE
                 FUNDS AND MANPOWER ARMY-WIDE IN THIS CONTEXT, THE FISCAL YEAR 2000 CAPABILITY AMOUNTS SHOWN CONSIDER EACH PROJECT OR STUDY BY ITSELF
                 WITHOUT REFERENCE TO THE REST OF THE PROGRAM. HOWEVER, IT IS EMPHASIZED THAT THE TOTAL AMOUNT PROPOSED FOR THE ARMY'S CIVIL WORKS PROGRAM
                 IN THE PRESIDENT'S BUDGET FOR FISCAL YEAR 2000 IS THE APPROPRIATE AMOUNT CONSISTENT WITH THE ADMINISTRATION'S ASSESSMENT OF NATIONAL
                 PRIORITIES FOR FEDERAL INVESTMENTS. IN ADDITION, THE TOTAL AMOUNT PROPOSED FOR THE ARMY'S CIVIL WORKS PROGRAM IN THE PRESIDENT'S BUDGET IS
                 THE MAXIMUM THAT CAN BE EFFICIENTLY AND EFFECTIVELY USED. THEREFORE, WHILE WE COULD UTILIZE ADDITIONAL FUNDS ON INDIVIDUAL PROJECTS AND
                 STUDIES, OFFSETTING REDUCTIONS WOULD BE REQUIRED IN ORDER TO MAINTAIN OUR OVERALL BUDGETARY OBJECTIVES.

               \1\ COST ESTIMATE INCLUDES AN ALLOWANCE FOR INFLATION THROUGH THE CONSTRUCTION PERIOD.

                           reimbursements and credits
        Question. General Ballard, what you have done to manage non-Federal
    sponsor requests to perform work for credit or reimbursement or to
    advance funds for projects?
        Answer. In the past, we have entertained all requests to perform
    creditable or reimbursable work or advance funds if we had the
    authority and the request was consistent with the project schedule and
    other decisions on budget and appropriations. However, because of the
    growth in interest in these arrangements, we will review the program
    and will consider establishing criteria to limit the impact of such
    arrangements on the program. Also, our policy is that before
    negotiating an agreement involving non-Federal work or advanced funds
    that could require possible future Federal appropriations we will
    coordinate the request within the Administration and with the
    Appropriations' Committees.
                     general expenses appropriation request
        Question. General Ballard or General Fuhrman, the budget request
    for fiscal year 2000 includes $148 million for executive direction and
    management functions of the Corps of Engineers. Is this level of
    funding adequate to manage the Civil Works program?
        Answer. The General Expenses funding level has remained at the $148
    million level for the last two fiscal years as the headquarters and
    division offices have undergone several restructuring and downsizing
    initiatives. These initiatives included a review and realignment of
    roles and missions to eliminate duplication, remove operating
    functions, reduce the number of division offices, and reorganize
    internally. These efforts were taken to make the most efficient use of
    the reduced workforce while still providing the executive direction and
    management needed to accomplish the civil works mission and be
    responsive to our customers.
        This reduced workforce has permitted us to maintain an appropriate
    level of executive direction and management with a constant $148
    million budget. However, as we approach our target manpower level,
    staffing reductions begin to taper off and it no longer is possible to
    absorb the increased costs of salaries, operations, and inflation.
    Nonetheless, we continue to look at ways to get our job done in the
    best manner possible at the lowest cost.
        Question. The General Expenses program has been held constant for
    the past several years. What impact has this had on your program,
    especially your ability to attract and retain talent needed to manage
    the program?
        Answer. I am very concerned about maintaining the technical and
    managerial expertise of the workforce, especially in the division
    offices and the headquarters. The problem is that when we cut staff to
    fit dollar ceilings not all the reductions are in the right job
    disciplines. To correct these imbalances, we then have to step up
    recruitment and, when we fill those positions, our costs of moving
    people to the jobs goes up. This puts more pressure on the General
    Expenses account so that we have to cut more staff to stay within our
    budget. You can see the predicament which is being driven by trying to
    manage a people-intensive account with a negative-growth budget. I call
    it a negative-growth budget because, although it's a flat budget in
    real dollars, the purchasing power is less than the prior year's.
        Question. What actions have you taken to streamline or bring about
    efficiencies required to maintain your Executive Direction and
    Management at this level?
        Answer. The Corps of Engineers has taken significant steps to
    reduce costs and increase efficiency. In compliance with Congressional
    direction, we reduced the number of divisions from 11 to 8 in fiscal
    year 1997. While reducing the number of divisions, we have reduced the
    number of positions funded by the General Expense account. The total
    number of positions to be funded from the General Expenses account in
    fiscal year 2000 is 1,142 which is 35 below the fiscal year 1999 level,
    and 226 below the number we had with 11 divisions in fiscal year 1996.
    Of the fiscal year 1996-2000 reduction, 56 percent comes from the
    division offices while the remaining 44 percent is from the
    headquarters and support activities.
        While we have reduced staff in accordance with the Federal
    Workforce Restructuring Act of 1994, our General Expenses staffing
    levels have been reduced by one-third from fiscal year 1990 to fiscal
    year 1999 and about one-third of this reduction has come in the last 3
    fiscal years. We have seen the division office staffing go from 950 in
    fiscal year 1990 to 584 in fiscal year 1999 while the headquarters has
    gone from 608 to 453 during this period. These reductions have
    permitted us to maintain an appropriate level of ED&M with a constant
    $148 million budget.
        Question. Your statement identifies business process improvements
    you are currently undertaking in an effort to hold down executive
    direction expenses. Given these process improvements, will it be
    possible to further reduce your General Expenses budget?
        Answer. We continue to look at ways to get our job done in the best
    manner possible at the lowest cost. I have undertaken a comprehensive
    review of the headquarters operating budget this year to assure we are
    staffed appropriately, and that we only incur expenses for essential
    goods and services. However, as we approach our target manpower level,
    staffing reductions begin to taper and it no longer is possible to
    absorb the increased costs of salaries, operations, and inflation.
        The executive direction and management activities performed by the
    headquarters and division offices plays a key role in providing
    guidance and oversight to our vital civil works mission. We will
    continue to work this issue and would greatly appreciate the support of
    the Appropriations Committees as we guide our Civil Works program into
    the next millenium.
        Question. What is the justification for maintaining extra offices
    in Chicago and Omaha?
        Answer. The regional offices in Chicago and Omaha are the remnants
    of the two division offices that we have closed and merged with the
    Great Lakes and Ohio River Division and the Northwestern Division
    respectively. Since our division office restructuring in fiscal year
    1997, we have been steadily reducing the staffs of each of these
    combined offices, taking into consideration the well-being of our
    workforce. The Great Lakes and Ohio River Division office and the
    Northwestern Division office have had their General Expenses staffing
    levels reduced by a total of 50 full-time equivalents, or FTE, between
    fiscal year 1997 and fiscal year 1999. We are continuing with our plan
    to size these two division offices in accordance with our standard
    sizing of all division offices. This will result in these two division
    offices being staffed at approximately 75 FTE each, or 150 combined. I
    intend, however, to continue to maintain a very small presence in
    Chicago in order to support our international team efforts with Canada
    through the International Joint Commission (IJC).
                   regulatory program--administrative appeals
        Question. The Conference Report on the fiscal year 1998 Energy and
    Water Appropriations Act stated, ``The conferees expect that the
    increase provided over the amount appropriated in fiscal year 1997 will
    be used to begin implementation of an administrative appeals process
    for the Corps of Engineers Regulatory Program.'' The Energy and Water
    subcommittees of the House and Senate both stated their concern for
    implementing this process again in the fiscal year 1999 report. Have
    you complied with the directions of the Congress? If not, why not?
        Answer. We have complied with the Congressional direction in the
    Committee report language as best as we could, consistent with our
    commitment to protect aquatic resources as required by law and to
    provide fair and responsive services to the public. The final
    regulation for appeals of permit denials and conditions was published
    in the Federal Register on 9 March 1999, with an effective date of 6
    August 1999. The process for the appeals of jurisdiction determinations
    is more complex and labor intensive. With the levels of funding for the
    Regulatory Program in recent years and the increase in the number of
    permit applications, we have not been able to start up this part of the
    appeals process without compromising our services to the public. We
    could not implement it within the below-budget appropriations in fiscal
    year 1998 and fiscal year 1999 without adversely impacting our services
    to the public. Consequently, the President's Budget again requests an
    appropriation of $5 million to implement the appeals process for
    jurisdiction determinations.
        Question. Now the expectation was that the Corps would implement
    both the administrative appeals process and the jurisdiction
    determination appeals process. What are your plans and timetable for
    implementing the procedures?
        Answer. Based on our budget request, the timetable for the full
    appeals process would be as follows:
    Permit Denials and Conditions
        March 9, 1999. Final regulation published in the Federal Register.
    Permit applicants are being notified that they may submit appeals of
    district decisions regarding their applications. Division offices are
    in the process of filling appeals officer positions and conducting
    training.
        August 6, 1999. Effective date for the appeals process to begin.
    Division appeals officers review the appeals submitted by the public
    and render decisions.
    Jurisdiction Determinations (Fast-track Implementation)
        Initiation of Action.--Once funding is provided, the Corps could
    begin the process of interagency coordination and approval by ASA(CW)
    quickly.
        First 150 days.--This period would be used to complete interagency
    coordination and approval by ASA(CW) and OMB. The final regulation
    would be published in Federal once approvals are received. The
    additional appeals officers required for this part of the appeals
    process would be hired and trained.
        Tenth month after initiation.--Effective date when we would begin
    reviewing appeals submitted by the public. (If the Corps began
    interagency coordination in, let's say, September/October 1999, the
    effective date would be extended by about 3 months to the June/July
    2000 time frame).
        Question. The Congress specifically earmarked or provided $5
    million for the Corps to implement the administrative appeals process
    in fiscal year 1998 and fiscal year 1999. In light of the fact that you
    have not implemented the administrative appeals process, how were these
    funds used? Why didn't you take appropriate actions to initiate and
    fund the administrative appeals process?
        Answer. The Appropriations Committee report language stated the
    intentions of the Committee to have a full appeals process implemented.
    However, the appropriations the Corps received in the fiscal years you
    mention were below the President's budget requests which would have
    provided for the full appeals process without sacrificing services to
    the public. At 90,000 permit actions in fiscal year 1998, workload is
    at an all time high. More citizens depend on our responsiveness to
    their permit applications than the number that would use the appeals
    process. Therefore, most of the Regulatory funds in these years was
    prudently used to continue providing timely, equitable services to the
    public. In fiscal year 1999, we were able to set aside some funds for
    the appeals of permit denials and conditions which will become
    effective on August 6, 1999.
        Question. I believe the Corps has indicated that they will
    implement only a partial administrative appeals process for permits
    denied. This means that property owners who disagree with the Corps on
    jurisdiction determinations will still have to spend an extended period
    of time in the permitting process before having the ability to
    challenge the decision in court. Please explain your justification for
    the Corps' decision to focus both its regulatory efforts and increased
    budget on a program already subjected to direct judicial review, and
    how do you believe this to be a fair and equitable process?
        Answer. A wetland delineation does not restrict an applicant from
    doing anything. He or she simply has to apply for a permit if the
    activity is in a wetland. If the permit is disapproved, or approved
    with certain conditions, then the applicant can challenge the
    delineation. The Corps performance goal is to process permit actions
    within 60 days and the most recent analyses of performance data showed
    that this goal is achieved 95 percent of the time. Everyone agrees that
    the appeals process is less expensive and less time consuming than
    litigation. Our experience has been that most applicants within the
    local Corps district office are satisfied with a fair hearing, even if
    they do not get the result they want. We want the permit process to be
    fair and equitable to our citizens and we do not believe that
    litigation is the best way to resolve differences. While we have
    supported the implementation of administrative appeals, the problem has
    been the affordability of a full appeals process and its impacts on the
    other parts of the Regulatory Program. To have dedicated $5 million
    from our already austere program for the full process would have meant
    shortages of regulatory personnel in the districts. This would have
    meant a noticeable reduction in our responsiveness.
        Question. The Conference Report on the fiscal year 1999 bill
    indicated that implementation of an administrative appeals process for
    only permit denials is unacceptable. Why has the Corps recently again
    insisted that it will only implement a program that addresses permit
    denials and that it needs more money to implement a full program,
    against the expressed instructions of the Congress?
        Answer. The Army's position is to support Committee report language
    as fully and as best as we can, within the resources provided in
    appropriation acts. However, the appropriations we received in the
    fiscal years you mention were well below the President's budget
    requests. To have dedicated $5 million from our already austere program
    for the full process would have meant shortages of regulatory personnel
    in the districts. The public would suffer because, with fewer team
    members to process permit applications, backlogs would grow and private
    citizens and businesspersons would have to wait longer to receive a
    permit. Given the limited funding and the number of people impacted by
    the permit program vs. the number who would benefit from an appeals
    program, we believed that a phased implementation would work best for
    the program and the public.
                       mississippi river and tributaries
        Question. General Ballard, I'm informed that the MR&T flood control
    system cannot pass the project design flood, or even a recurrence of
    the flood that actually accrued in 1927. Is the budget request for the
    MR&T project sufficient to make meaningful progress in addressing the
    flood control needs along the Mississippi River and tributaries, in
    your judgment?
        Answer. While the budget request for the Mississippi River and
    Tributaries project would allow work to proceed on all projects, albeit
    not on optimal schedules, the development of the budget required
    difficult trade-offs. It does not reflect the full level of capability
    within the Mississippi River and Tributaries project.
        Question. Are you concerned that the budget request is not
    sufficient to address this critical situation?
        Answer. Until critical work is completed on the Mississippi River
    and the Atchafalaya River, the entire lower valley remains at risk from
    major flood events. Because I am concerned, I have exercised my full
    authority to assure that the most critical work within the Mississippi
    River and Tributaries project receives a funding priority.
        Question. What risk does not having the ability to pass the project
    or near project flood pose to the region and the Nation?
        Answer. Through the Army Corps of Engineers, the Federal Government
    has made major investments over the past 70 years to reduce the risk of
    a recurrence of the level of flood damages experienced during the 1927
    Flood. As a result of these Federal investments, the risk of failure
    has been diminishing with each passing year. However, if the project
    flood or a near project flood were to occur, because the project is not
    yet complete and because of the increased development throughout the
    valley since 1927, we would experience major damage on a large scale.
    If large areas of the 35,457 square mile alluvial floodplain were
    flooded, life and property would be threatened; and interruption to
    highway, rail, and interstate commerce would result. Both agricultural
    and industrial interests would be adversely affected and would require
    a significant time to recover.
        Question. General Ballard, do you believe that the amount requested
    for fiscal year 2000 for the MR&T project is adequate to address the
    flood control, navigation, and environmental problems and opportunities
    facing the lower Mississippi Valley?
        Answer. No, sir. In my opinion, adequate progress in solving these
    problems and meeting needs within the Lower Mississippi Valley would
    require a larger program in fiscal year 2000.
        Question. General Ballard, what is the Corps' capability for the
    MR&T project in fiscal year 2000?
        Answer. The Corps capability for fiscal year 2000 for the
    Mississippi River and Tributaries project is $350 million.
        Question. How much do you think is needed to make adequate progress
    toward completion of this extremely important work?
        Answer. An appropriation of $350 million would be needed to
    maintain optimal schedules.
        Question. Please provide for the record a list which shows the
    Corps' capability for studies, construction and operations and
    maintenance for fiscal year 2000.
        Answer. Yes, sir. I will provide for the record the fiscal year
    2000 capabilities for the Mississippi River and Tributaries Project.

                                              FISCAL YEAR 2000 FUNDING CAPABILITIES MISSISSIPPI RIVER & TRIBUTARIES
                                                                     (Amounts in Thousands)
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Amounts
    Congressional                                Estimated     included in        Study
      Districts      Study and State     Type     Federal      President's     capability              Purpose of additional capability              Amount
                                                    cost         budget
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                AUTHORIZED STUDIES

               ARKANSAS:
                   COLLECTION AND    .......          725             365             365  NO ADDITIONAL REQUIREMENT...........................  .........
                    STUDY OF BASIC
                    DATA
            AR 4   SOUTHEAST         (COM)          4,495  ..............           1,200  CONTINUE FEASIBILITY STUDY..........................     $1,200
                    ARKANSAS, AR                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.

                  PRECONSTRUCTION
                  ENGINEERING AND
                      DESIGN

               ARKANSAS:
      AR 1, 2, 4   BAYOU METO        (FC)          12,000           1,767           5,000  ADVANCE COMPLETION OF PED 24 MONTHS.................      3,233
                    BASIN, AR
      AR 1, 2, 4   GRAND PRAIRIE     (FC)          11,584  ..............  ..............  FULLY FUNDED........................................  .........
                    REGION, AR
                    (SEPERABLE
                    ELEMENT)

                   CONSTRUCTION
                     PROJECTS

               ARKANSAS:
            AR 1   CACHE RIVER       (FC)         155,000             (C)             (C)  LACK OF LOCAL COOPERATION...........................  .........
                    BASIN, AR
      AR 1, 2, 4   CHANNEL           (FC)       3,667,000      37,685 (C)      43,165 (C)  COMPLETE TENN/WILLOW MS LA..........................      1,100
           IL 19    IMPROVEMENT,                                                           COMPLETE YUCATAN LA.................................      1,000
            KY 1    AR, IL, KY, LA,                                                        COMPLETE WARFIELD MS................................      1,500
     LA 1, 2, 3,    MS, MO &  TN                                                           COMPLETE VAUCLUSE AR................................      1,000
      4, 5, 6, 7                                                                           INITIATE WOLF ISLAND BAR KY ADVANCE PROJECT                 880
         MO 8, 9                                                                            COMPLETION BY 2 MO.
     MS 1, 2, 3,
            4, 5
      TN 7, 8, 9
                                                                                                                                                ------------
                                                                                                                                                     5,480
            AR 1   EIGHT MILE        (FC)       \1\ 9,000         700 (C)         700 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    CREEK, AR
      AR 1, 2, 4   GRAND PRAIRIE     (FC)     \1\ 245,350      21,900 (C)      21,900 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    REGION, AR
            AR 1   HELENA AND        (FC)       \1\ 8,370       2,190 (C)       2,190 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    VICINITY, AR
            AR 1   HELENA HARBOR,    (N)           32,156             (C)             (C)  FULLY FUNDED........................................  .........
                    PHILLIPS
                    COUNTY, AR
      AR 1, 2, 4   MISSISSIPPI       (FC)       1,995,000      23,250 (C)      35,750 (C)  ADVANCE COMMERCE BIRDS PT LEVEE GRADE RAISE MO......      1,000
           IL 19    RIVER LEVEES,                                                          ADVANCE WILSON PT PT LOOKOUT LA ITEM 489 R..........      1,000
            KY 1    AR, IL, KY, LA,                                                        ADVANCE CAROLINA VALEWOOD MS ITEM 502-L.............      1,000
     LA 1, 2, 3,    MS, MO & TN                                                            ADVANCE VALEWOOD CARLISLE MS IT 496L................      2,200
      4, 5, 6, 7                                                                           ADVANCE STATELINE WILSON PT LA ITEM 503-R...........      1,000
         MO 8, 9                                                                           ADVANCE WILSON PT PT LOOKOUT LA ITEM 487-R..........        300
     MS 1, 2, 3,                                                                           ADVANCE CARVILLE MARCHAND LA........................        500
            4, 5                                                                           ADVANCE ALHAMBRA HOHEN SOLMS LA.....................        300
      TN 7, 8, 9                                                                           ADVANCE HOHEN SOLMS MODESTE LA......................        700
                                                                                           ADVANCE REVEILLE PT PLEASANT LA.....................        500
                                                                                           ADVANCE DRINKWATER MO PUMP STATION..................      1,000
                                                                                           INITIATE BLUE LAKE AR...............................      1,000
                                                                                           INITIATE CAIRO IL ITEM 2............................        500
                                                                                           INITIATE ISLAND 8, KY...............................      1,000
                                                                                           INITIATE ABOVE CAIRO IL ITEM 1 ADVANCE PROJECT              500
                                                                                            COMPLETION 6 MONTHS.
                                                                                                                                                ------------
                                                                                                                                                    12,500
            AR 1   ST FRANCIS        (FC)     \1\ 387,000       4,350 (C)       4,850 (C)  ADVANCE COMPLETION OF CHANNEL IMPROVEMENTS AT MAIN &        500
            MO 8    BASIN, AR & MO                                                          DITCH 2, ITEM 2, MO BY 9 MONTHS.
            AR 4   TENSAS BASIN--    (FC)     \1\ 475,336       8,930 (C)       9,930 (C)  SEE BELOW...........................................  .........
      LA 4, 5, 6    OVERALL
                   TENSAS BASIN,     (FC)        (94,280)         (0) (C)         (0) (C)  LACK OF ADEQUATE LOCAL SUPPORT......................  .........
                    BOEUF TENSAS
                    LESS TENSAS R
                   TENSAS BASIN,     (FC)        (96,230)         (0) (C)         (0) (C)  PROJECT COMPLETE....................................  .........
                    LAKE CHICOT
                    PUMPING PLANT
                   TENSAS COCODRIE   (FC)        (56,466)         (0) (C)         (0) (C)  COMPLETED PROJECT...................................  .........
                    PUMPING PLANT
                   TENSAS RIVER      (FC)        (42,600)         (0) (C)         (0) (C)  LACK OF ADEQUATE LOCAL SUPPORT......................  .........
            AR 1   WHITEMAN'S        (FC)       \1\ 3,300             (C)             (C)  FULLY FUNDED........................................  .........
                    CREEK, AR

                   OPERATION AND
                    MAINTENANCE

               ARKANSAS:
                   CHANNEL           (FC)     ...........          55,876          66,676  ....................................................  .........
                    IMPROVEMENT,
                    AR, IL, KY, LA,
                    MS, MO &  TN
      AR 1, 2, 4   CHANNEL           (FC)     ...........        (17,046)        (20,046)  DREDGE ADDITIONAL 4,000,000 CY ON MISSISSIPPI RIVER       3,000
            KY 1    IMPROVEMENT,                                                            BUDGET AMT IS FOR 110 DAYS; 5 YR AVERAGE IS 184
     LA 1, 2, 3,    DREDGING, AR,                                                           DAYS; CAPABILITY WOULD ALLOW FOR AN ADDITIONAL 70
      4, 5, 6, 7    IL, KY, LA, MS,                                                         DREDGING DAYS.
            MO 8    MO & TN
    MS 1, 2, 3, 4
      TN 6, 7, 8
      AR 1, 2, 4   CHANNEL           (FC)     ...........        (38,830)        (46,630)  STABILIZE BANK TO PROTECT SHORELINE.................      7,400
            KY 1    IMPROVEMENT,                                                           STONE REPAIRS TO REVETMENTS AND DIKS................        400
     LA 1, 2, 3,    RVT & DIKES,
      4, 5, 6, 7    AR, IL, KY, LA,
         MO 8, 9    MS, MO, TN
     MS 1, 2, 3,
            4, 5
      TN 6, 7, 8
                                                                                                                                                ------------
                                                                                                                                                     7,800
            AR 1   HELENA HARBOR,    (N)      ...........             284             484  DREDGE HARBOR ADDITIONAL 200,000 CY BUDGET AMT IS           200
                    PHILLIPS                                                                FOR 9 DAYS; 5 YR AVG IS 12 DAYS; CAPABILITY WOULD
                    COUNTY, AR                                                              ALLOW FOR AN ADDITIONAL 6 DREDGING DAYS.
                   INSPECTION OF     (FC)     ...........             443             443  ....................................................  .........
                    COMPLETED
                    WORKS, AR
            AR 4   LOWER ARKANSAS    (FC)     ...........              66              66  NO ADDITIONAL REQUIREMENT...........................  .........
                    RIVER, NORTH
                    BANK, AR
            AR 4   LOWER ARKANSAS    (FC)     ...........             108             108  NO ADDITIONAL REQUIREMENT...........................  .........
                    RIVER, SOUTH
                    BANK, AR
      AR 1, 2, 4   MISSISSIPPI       (FC)     ...........           3,736           4,686  REPLACE DOLPHIN, GOOSE POND IL......................        150
           IL 19    RIVER LEVEES,                                                          RESTORE SLOPE, WEST MEMPHIS AR......................        500
            KY 1    AR, IL, KY, LA,                                                        RESTORE SLOPE, JOINER AR............................        100
     LA 1, 2, 3,    MS, MO & TN                                                            REPLACE CULVERT NEW MADRID MO.......................        200
      4, 5, 6, 7
         MO 8, 9
     MS 1, 2, 3,
            4, 5
      TN 7, 8, 9
                                                                                                                                                ------------
                                                                                                                                                       950
            AR 1   ST FRANCIS        (FC)     ...........           6,300           9,550  CLEANOUT CHANNEL AT HIGHWAY 90, AR & MO.............      2,400
            MO 8    BASIN, AR & MO                                                         CLEANOUT CHANNEL, DITCH 251 UPPER, MO...............        250
                                                                                           CLEAR CHANNEL, BIG SLOUGH & MAYO DITCHES, AR........        300
                                                                                           CLEANOUT CHANNEL, DITCH 9, LAKE CITY, AR............        100
                                                                                           AERIAL BRUSH CONTROL ON VARIOUS CHANNELS............        200
                                                                                                                                                ------------
                                                                                                                                                     3,250
            AR 4   TENSAS BASIN,     (FC)     ...........           2,344           2,344  NO ADDITIONAL REQUIREMENT...........................  .........
            LA 5    BOEUF AND
                    TENSAS RIVERS,
                    AR & LA
         AR 1, 2   WHITE RIVER       (FC)     ...........             964             964  NO ADDITIONAL REQUIREMENT...........................  .........
                    BACKWATER, AR

                AUTHORIZED STUDIES

               ILLINOIS:
           IL 12   MISSISSIPPI       (FDP)        \1\ 100              30              30  NO ADDITIONAL REQUIREMENT...........................  .........
            MO 8    RIVER,
                    ALEXANDER
                    COUNTY, IL AND
                    SCOTT COUNTY,
                    MO

                   OPERATION AND
                    MAINTENANCE

               ILLINOIS:
                   INSPECTION OF     (FC)     ...........              45              45  ....................................................  .........
                    COMPLETED
                    WORKS, IL

                   CONSTRUCTION
                     PROJECTS

               KENTUCKY:
            KY 1   HICKMAN BLUFF,    (FC)      \1\ 19,810             (C)             (C)  FULLY FUNDED........................................  .........
                    KY

                   OPERATION AND
                    MAINTENANCE

               KENTUCKY:
                   INSPECTION OF     (FC)     ...........              25              25  ....................................................  .........
                    COMPLETED
                    WORKS, KY
            KY 1   LAKE NO 9         (FC)     ...........  ..............  ..............  PERIODIC MAITNENANCE OF PUMPING PLANT NOT CURRENTLY   .........
            TN 8    PUMPING PLANT,                                                          REQUIRED.
                    KY

                AUTHORIZED STUDIES

               LOUISIANA:
    LA 3, 5, 6, 7  ALEXANDRIA, LA    (FDP)          3,150             700             700  NO ADDITIONAL REQUIREMENT...........................  .........
                    TO THE GULF OF
                    MEXICO
            LA 6   DONALDSONVILLE    (FDP)          3,500             250             250  NO ADDITIONAL REQUIREMENT...........................  .........
                    TO THE GULF, LA
            LA 5   SPRING BAYOU,     (SPE)            100  ..............             100  INITIATE RECONNAISSANCE PHASE OF STUDY..............  .........
                    LOUISIANA
            LA 6   WEST BATON ROUGE  (SPE)          2,100  ..............             100  INITIATE RECONNAISSANCE PHASE OF STUDY..............  .........
                    PARISH, LA

                  PRECONSTRUCTION
                  ENGINEERING AND
                      DESIGN

               LOUISIANA:
            LA 6   LA STATE PEN      (FC)             424  ..............  ..............  FULLY FUNDED........................................  .........
                    LEVEE
    LA 3, 5, 6, 7  MORGANZA, LA TO   (FC)           2,025             700             700  NO ADDITIONAL REQUIREMENT...........................  .........
                    THE GULF OF
                    MEXICO

                   CONSTRUCTION
                     PROJECTS

               LOUISIANA:
     LA 3, 4, 5,   ATCHAFALAYA       (FC)     \1\ 185,000       7,500 (C)       8,000 (C)  ADVANCE LAND ACQUISITION ADVANCE PROJECT COMPLETION         500
            6, 7    BASIN, FLOODWAY                                                         9 MONTHS.
                    SYSTEM, LA
     LA 3, 4, 5,   ATCHAFALAYA       (FC)     \1\ 1,720,0      19,750 (C)      23,750 (C)  ADVANCE BAYOU YOKELY PUMPING STATION 9 YEARS........      2,000
            6, 7    BASIN, LA                          00                                  INITIATE LEVEE ENLARGEMENT CONTRACT, 2ND LIFT--ITEMS      2,000
                                                                                            W46 & W52.
                                                                                                                                                ------------
                                                                                                                                                     4,000
            LA 6   LOUISIANA STATE   (FC)          19,500       3,000 (C)       9,000 (C)  ADVANCE LEVEE UPSTREAM CAMP C 12 MONTHS--CONTRACT #       2,200
                    PENITENTIARY                                                            1.                                                       2,200
                    LEVEE, LA                                                              ADVANCE LEVEE UPSTREAM CAMP C CONT 2 12 MONTHS--          1,600
                                                                                            CONTRACT # 2.
                                                                                           ADVANCE DRAINAGE STRUCTURE CONTRACT 6 MONTHS ADVANCE
                                                                                            PROJECT COMPLETION 1 YEAR.
                                                                                                                                                ------------
                                                                                                                                                     6,000
      LA 1, 2, 3   MISSISSIPPI AND   (FC)      \1\ 66,900         100 (C)         100 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
            MS 5    LOUISIANA
                    ESTUARINE
                    AREAS, LA & MS
            LA 3   MISSISSIPPI       (FC)      \1\ 99,200      10,400 (C)      11,884 (C)  ADVANCE BURLINGTON NORTHERN RR CONTRACT 6 MONTHS....        706
                    DELTA REGION,                                                          ADVANCE DIVERSION STURCTURE CONTRACT 6 MONTHS.......        778
                    LA
                                                                                                                                                ------------
                                                                                                                                                     1,484
                   TENSAS BASIN,     (FC)       (166,900)     (8,930) (C)     (9,930) (C)  ADVANCE AWARD ITEM 1C...............................        469
                    RED RIVER                                                              ADVANCE AWARD ITEM 1D...............................        375
                    BACKWATER, LA                                                          PURCHASE LANDS......................................        156
                                                                                           NO IMPACT ON PROJECT COMPLETION.....................
                                                                                                                                                ------------
                                                                                                                                                     1,000

                   OPERATION AND
                    MAINTENANCE

               LOUISIANA:
     LA 3, 4, 5,   ATCHAFALAYA       (FC)     ...........             644           1,702  REFOREST FOR HABITAT REQUIREMENTS AND FULLY FUND            143
            6, 7    BASIN, FLOODWAY                                                         EXISTING CONTRACT.
                    SYSTEM, LA                                                             REPAIR INTERIOR ROADS AND CONSTRUCT NEW TRAILS......        276
                                                                                           PROCURE SUPPLIES AND EQUIPMENT FOR PEST AND FOREST          354
                                                                                            MANAGEMENT.
                                                                                           CONSTRUCT ACCESS POINTS TO LANDS AND PROVIDE SAFETY         285
                                                                                            & HANDICAPPED FEATURES TO FACILITIES.
                                                                                                                                                ------------
                                                                                                                                                     1,058
     LA 3, 4, 5,   ATCHAFALAYA       (FC)     ...........          10,560          14,925  REPLACE GUIDEWALL AT BERWICK LOCK...................        500
            6, 7    BASIN, LA                                                              REPLACE SOUTHWEST GUIDEWALL AT BAYOU BOEUF LOCK.....      1,750
                                                                                           REPLACE SOUTHWEST GUIDEWALL AT SORREL LOCK..........        525
                                                                                           REPLACE NORTHWEST GUIDEWALL AT BAYOU SORREL  LOCK...      1,170
                                                                                           REPAIR WEST CHAMBER GUIDEWALL AT BAYOU SORREL LOCK..
                                                                                                                                                       420
                                                                                                                                                ------------
                                                                                                                                                     4,365
    LA 4, 5, 6, 7  BATON ROUGE       (N)      ...........             157             157  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, DEVIL
                    SWAMP, LA
    LA 4, 5, 6, 7  BAYOU COCODRIE    (FC)     ...........             101             101  NO ADDITIONAL REQUIREMENT...........................  .........
                    AND
                    TRIBUTARIES, LA
      LA 1, 2, 3   BONNET CARRE, LA  (FC)     ...........           1,068           1,068  NO ADDITIONAL REQUIREMENT...........................  .........
                   INSPECTION OF     (FC)     ...........             373             373  ....................................................  .........
                    COMPLETED
                    WORKS, LA
      LA 4, 5, 6   LOWER RED RIVER,  (FC)     ...........              84           3,034  INITIATE CONSTRUCTION OF BAYOU RAPIDES REPLACEMENT        2,950
                    SOUTH BANK                                                              STRUCTURE.
                    LEVEES, LA
      AR 1, 2, 4   MAPPING           (FC)     ...........           1,117           1,117  NO ADDITIONAL REQUIREMENT...........................  .........
            KY 1
     LA 1, 2, 3,
      4, 5, 6, 7
         MO 8, 9
    MS 1, 2, 3, 4
      TN 7, 8, 9
            LA 3   MISSISSIPPI       (FC)     ...........             436             591  OPERATION OF DAVIS POND PUMPING STATION.............        155
                    DELTA REGION,
                    LA
    LA 3, 5, 6, 7  OLD RIVER, LA     (FC)     ...........           4,027           8,110  ACQUIRE EXHIBITS FOR VISITOR CENTER.................      1,208
                                                                                           REPLACE ELECTRICAL WIRING AT OLD RIVER LOCK.........        150
                                                                                           CONSTRUCT NEW SHOP BUILDING AT THE OLD RIVER COMPLEX        700
                                                                                           SAND BLAST AND PAINT GANTRY CRANE...................
                                                                                           REPLACE CREOSOTE NEEDLES AT THE OVERBANK STRUCTURE..        430
                                                                                           REPLACE MITER GATES AT OLD RIVER LOCK...............        250

                                                                                                                                                     1,345
                                                                                                                                                ------------
                                                                                                                                                     4,083
            AR 4   TENSAS BASIN,     (FC)     ...........           2,927           2,927  NO ADDITIONAL REQUIREMENT RIVER BACKWATER, LA.......  .........
            LA 5    RED

                   CONSTRUCTION
                     PROJECTS

               MISSISSIPPI:
            MS 1   HORN LAKE CREEK   (FC)       \1\ 3,120             (C)             (C)  FULLY FUNDED........................................  .........
            TN 9    & TRIBUTARIES
                    (INCL COW PEN
                    CREEK), MS & TN
         MS 1, 2   YAZOO BASIN--     (FC)       1,740,246      24,279 (C)      40,985 (C)  ....................................................  .........
                    OVERALL
                   YAZOO BASIN,      (FC)        (38,954)         (0) (C)         (0) (C)  FUNDED AS PART OF TRIBUTARIES ASCALMORE-TIPPO-OPOS    .........
                                                                                            SUM, MS.
                   YAZOO BASIN,      (FC)        (18,505)         (0) (C)         (0) (C)  COST SHARING AND FINANCING BY LOCAL.................  .........
                    BACKWATER--ROCK
                    Y INTEREST IS
                    UNAVAILABLE
                    BAYOU AREA, MS
                   YAZOO BASIN,      (FC)       (254,491)        (20) (C)        (20) (C)  FUNDED AS PART OF THE YAZOO ACKWATER UNIT...........  .........
                    BACKWATER LESS
                    ROCKY BAYOU, MS
                   YAZOO BASIN,      (FC)        (97,840)       (500) (C)     (1,000) (C)  ADVANCE DESIGN ON YAZOO REFORMULATED PLAN NO IMPACT         500
                    BACKWATER PUMP,                                                         ON COMPLETION OF UNIT.
                    MS
                   YAZOO BASIN, BIG  (FC)       (109,383)     (3,915) (C)     (4,415) (C)  PURCHASE MITIGATION LANDS SUNFLOWER RIVER, MS.......        500
                   YAZOO BASIN,      (FC)       (161,439)         (0) (C)         (0) (C)  COMPLETED WORK......................................
                    COMPLETED
                    UNITS, MS
                   YAZOO BASIN,      (FC)       (244,284)     (6,294) (C)    (20,000) (C)  INITIATE & COMPLETE:................................
                    DEMONSTRATION                                                            1--FLOODWATER RETARDING STRUCTURE.................      1,363
                    EROSION                                                                  11--RISER PIPE CONTRACTS..........................      2,777
                    CONTROL,  MS                                                             3--BANK STAB ITEMS................................        962
                                                                                             4--BOX CULVERT CONTRACTS..........................        616
                                                                                             6--LOW DROP CONTRACTS.............................      1,102
                                                                                             REAL ESTATE ACQUISITION, MONITORING, E&D AND S&A..      6,886
                                                                                           NOTE: THE ADMINISTRATION'S REVIEW OF THIS PROJECT
                                                                                            HAS IDENTIFIED ECONOMIC AND/OR POLICY CONCERNS.
                                                                                                                                                ------------
                                                                                                                                                    13,706
                   YAZOO BASIN,      (FC)         (7,511)         (0) (C)         (0) (C)  FULLY FUNDED........................................  .........
                    F&WL MITIGATION
                    LANDS, MS
                   YAZOO BASIN,      (FC)       (194,431)        (20) (C)        (20) (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    MAIN STEM, MS
                   YAZOO BASIN,      (FC)        (32,408)     (1,570) (C)     (1,570) (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    REFORMULATION
                    UNIT, MS
                   YAZOO BASIN,      (FC)       (243,000)       (340) (C)       (340) (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    TRIBUTARIES, MS
                   YAZOO BASIN,      (FC)       (338,000)    (11,620) (C)    (13,620) (C)  ACCELERATE CONST CHANNEL ITEM 4.....................      1,000
                    UPPER YAZOO                                                            PURCHASE MITIGATION LANDS NO IMPACT ON PROJECT            1,000
                    PROJECTS, MS                                                            COMPLETION.
                                                                                                                                                ------------
                                                                                                                                                     2,000

                   OPERATION AND
                    MAINTENANCE

               MISSISSIPPI:
            MS 2   GREENVILLE        (N)      ...........             333             333  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, MS
                   INSPECTION OF     (FC)     ...........             193             193  ....................................................  .........
                    COMPLETED
                    WORKS, MS
            MS 2   VICKSBURG         (N)      ...........             199             199  NO ADDITIONAL REQUIREMENT...........................  .........
                    HARBOR, MS
            MS 1   YAZOO BASIN,      (FC)     ...........           3,265           4,865  REPAIR INTAKE STRUCTURE & TOE DRAIN SYSTEM..........        800
                    ARKABUTLA LAKE,                                                        REPLACE UNDERGROUND ELECTRICAL SYSTEMS..............        800
                    MS
                                                                                                                                                ------------
                                                                                                                                                     1,600
            MS 2   YAZOO BASIN, BIG  (FC)     ...........             209           4,709  CONTINUE CONSTRUCTION OF BOGUE PHALIA...............      4,500
                    SUNFLOWER
                    RIVER, MS
            MS 1   YAZOO BASIN,      (FC)     ...........           3,214           4,354  REPAIR OUTLET STRUCTURE & EMERGENCY SPILLWAY........        500
                    ENID LAKE, MS                                                          REPLACE UNDERGROUND ELECTRICAL SYSTEMS..............        640
                                                                                                                                                ------------
                                                                                                                                                     1,140
            MS 2   YAZOO BASIN,      (FC)     ...........             946             946  NO ADDITIONAL REQUIREMENT...........................  .........
                    GREENWOOD, MS
            MS 1   YAZOO BASIN,      (FC)     ...........           4,280           6,580  REPAIR DAM BERM DRAINAGE SYSTEM.....................        800
                    GRENADA LAKE,                                                          REPAIR & RESURFACE ACCESS ROADS.....................      1,500
                    MS
                                                                                                                                                ------------
                                                                                                                                                     2,300
         MS 1, 2   YAZOO BASIN,      (FC)     ...........           1,059           1,059  NO ADDITIONAL REQUIREMENT...........................  .........
                    MAIN STEM, MS
            MS 1   YAZOO BASIN,      (FC)     ...........           4,334           5,534  REPAIR OUTLET STRUCTURE AND TOE DRAIN SYSTEM........      1,200
                    SARDIS LAKE, MS
         MS 1, 2   YAZOO BASIN,      (FC)     ...........           1,269           1,269  NO ADDITIONAL REQUIREMENT...........................  .........
                    TRIBUTARIES, MS
         MS 3, 4   YAZOO BASIN,      (FC)     ...........             493             493  NO ADDITIONAL REQUIREMENT...........................  .........
                    WILL M
                    WHITTINGTON AUX
                    CHAN, MS
      MS 1, 2, 3   YAZOO BASIN,      (FC)     ...........             560             560  NO ADDITIONAL REQUIREMENT...........................  .........
                    YAZOO BACKWATER
                    AREA, MS
            MS 3   YAZOO BASIN,      (FC)     ...........             846             846  NO ADDITIONAL REQUIREMENT...........................  .........
                    YAZOO CITY, MS

                   CONSTRUCTION
                     PROJECTS

               MISSOURI:
            MO 8   ST JOHNS BAYOU    (FC)      \1\ 58,800       7,800 (C)       9,800 (C)  ADVANCE COMPLETION OF NEW MADRID PUMPING STATION 12       2,000
                    AND NEW MADRID                                                          MONTHS.
                    FLOODWAY, MO

                   OPERATION AND
                    MAINTENANCE

               MISSOURI:
                   INSPECTION OF     (FC)     ...........             202             202  ....................................................  .........
                    COMPLETED
                    WORKS, MO
            MO 8   WAPPAPELLO LAKE,  (FC)     ...........           3,500           7,705  COMPLETE HIGHWAY D3 RELOCATIONS.....................        880
                    MO                                                                     INITIATE CONTRACT FOR HIGHWAY D4 RELOCATION.........      2,975
                                                                                           OVERLAY ASPHALT GREENVILLE DAY USE AREA.............        100
                                                                                           MANTAIN NON-REC ROAD BELOW THE DAM..................        150
                                                                                           REPAIR HOLIDAY LANDING ENTRANCE FORSAFETY...........        100
                                                                                                                                                ------------
                                                                                                                                                     4,205

                AUTHORIZED STUDIES

               TENNESSEE:
            MS 1   MEMPHIS METRO     (COM)          2,075             675             675  NO ADDITIONAL REQUIREMENT...........................  .........
      TN 7, 8, 9    AREA, TN & MS

                  PRECONSTRUCTION
                  ENGINEERING AND
                      DESIGN

               TENNESSEE:
            KY 1   REELFOOT LAKE,    (FC)             750             318             318  NO ADDITIONAL REQUIREMENT...........................  .........
            TN 8    TN & KY
      TN 7, 8, 9   WOLF RIVER,       (FC)             579             525             525  NO ADDITIONAL REQUIREMENT...........................  .........
                    MEMPHIS, TN

                   CONSTRUCTION
                     PROJECTS

               TENNESSEE:
            TN 9   NONCONNAH CREEK-- (FC)      \1\ 18,400       2,500 (C)       2,500 (C)  ....................................................  .........
                    OVERALL, TN &
                    MS
            TN 9   NONCONNAH CREEK,  (FC)       \1\ (131)         (0) (C)         (0) (C)  LACK OF RECENT EXPRESSION OF LOCAL INTEREST.........  .........
                    ENVIRONMENTAL
                    ENHANCEMENT, TN
                    & MS
            TN 9   NONCONNAH CREEK,  (FC)     \1\ (17,941     (2,500) (C)     (2,500) (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    FLOOD CONTROL                      1)
                    FEATURE, TN &
                    MS
            TN 9   NONCONNAH CREEK,  (FC)       \1\ (328)         (0) (C)         (0) (C)  LACK OF RECENT EXPRESSION OF LOCAL INTEREST.........  .........
                    RECREATION
                    FACILITIES, TN
                    &  MS
         TN 7, 8   WEST TENNESSEE    (FC)     \1\ 143,000       2,398 (C)       2,398 (C)  NO ADDITIONAL REQUIREMENT...........................  .........
                    TRIBUTARIES, TN

                   OPERATION AND
                    MAINTENANCE

               TENNESSEE:
                   INSPECTION OF     (FC)     ...........             113             113  ....................................................  .........
                    COMPLETED
                    WORKS, TN
            TN 9   MEMPHIS HARBOR,   (N)      ...........             800           1,400  DREDGE HARBOR ADDITIONAL 800,000 CY BUDGET AMT IS           600
                    MCKELLAR LAKE,                                                          FOR 27 DAYS; 5 YR AVG IS FOR 42 DAYS; CAPABILITY
                    TN                                                                      WOULD ALLOW AN ADDITIONAL 20 DREDGING DAYS.

    --------------------------------------------------------------------------------------------------------------------------------------------------------
               NOTE: ALTHOUGH PROJECT AND STUDY CAPABILITIES REFLECT THE READINESS OF THE WORK FOR ACCOMPLISHMENT, THEY ARE IN COMPETITION FOR AVAILABLE
                 FUNDS AND MANPOWER ARMY-WIDE IN THIS CONTEXT, THE FISCAL YEAR 2000 CAPABILITY AMOUNTS SHOWN CONSIDER EACH PROJECT OR STUDY BY ITSELF
                 WITHOUT REFERENCE TO THE REST OF THE PROGRAM. HOWEVER, IT IS EMPHASIZED THAT THE TOTAL AMOUNT PROPOSED FOR THE ARMY'S CIVIL WORKS PROGRAM
                 IN THE PRESIDENT'S BUDGET FOR FISCAL YEAR 2000 IS THE APPROPRIATE AMOUNT CONSISTENT WITH THE ADMINISTRATION'S ASSESSMENT OF NATIONAL
                 PRIORITIES FOR FEDERAL INVESTMENTS. IN ADDITION, THE TOTAL AMOUNT PROPOSED FOR THE ARMY'S CIVIL WORKS PROGRAM IN THE PRESIDENT'S BUDGET IS
                 THE MAXIMUM THAT CAN BE EFFICIENTLY AND EFFECTIVELY USED. THEREFORE, WHILE WE COULD UTILIZE ADDITIONAL FUNDS ON INDIVIDUAL PROJECTS AND
                 STUDIES, OFFSETTING REDUCTIONS WOULD BE REQUIRED IN ORDER TO MAINTAIN OUR OVERALL BUDGETAR OBJECTIVES.
               BUDGET AND CAPABILITY AMOUNTS REFLECT FEDERAL FUNDS, EXCEPT FOR PROJECTS WITH COSTS ALLOCATED TO NAVIGATION, FOR WHICH THE AMOUNTS INCLUDE
                 NON-FEDERAL FUNDING FROM THE INLAND WATERWAYS & HARBO MAINTENANCE TRUST FUNDS.
               \1\ COST ESTIMATE INCLUDES AN ALLOWANCE FOR INFLATION THROUGH THE CONSTRUCTION PERIOD.

                    operation and maintenance budget request
        Question. Does this budget provide the funds necessary to
    adequately operate and maintain the project and to respond to the
    Corps' many challenges in this environmentally sensitive area?
        Answer. The budget maintains the operations portion at current
    funding level. We have funded the most critical maintenance in fiscal
    year 2000. However, repeated reductions in the maintenance program
    could delay, slow down or defer channel surveys, repair of levee
    slides, repair of equipment, maintenance of flood control, navigation,
    and salinity control structures, and maintenance of recreation
    facilities. Reductions would also cause adverse impacts on commercial
    navigation and related industries and local, regional, national, and
    international commerce.
                formerly utilized sites remedial action program
        Question. Briefly, describe for the Committee the differences in
    the Department of Energy's proposed accelerated clean up plan for the
    FUSRAP program. How does the Corps' overall project costs and schedules
    compare to the DOE accelerated cleanup plan?
        Answer. In June 1997, the Department of Energy (DOE) developed a
    draft accelerated cleanup plan, which showed that FUSRAP could be
    completed in 2002. To achieve that completion schedule, the accelerated
    plan limited the scope of the program, principally by proposing that
    hazardous wastes at the Niagara Falls Storage Site remain on site and
    by proposing to clean up the St. Louis sites to a restricted use
    industrial standard rather than industrial use. The draft accelerated
    cleanup plan also was based on an estimate of the requirement at the
    Luckey site which, it has since been established, greatly
    underestimated the quantities requiring remediation. In addition, DOE
    estimates did not include any requirement for remediating contaminated
    ground water. Further, DOE's completion date of 2002 for the draft
    accelerated cleanup plan was premised on an annual funding level of
    $182 million per year. The Corps received only $140 million in fiscal
    year 1998 and in fiscal year 1999, and has been allocated a ceiling of
    $150 million a year, starting in fiscal year 2000, to complete FUSRAP.
    We estimate that at this funding level, with a remaining requirement of
    $1.1 billion, it will require until at least 2010 to complete the
    program. The review of cost estimates, by site, which the Corps
    completed during the 3rd quarter fiscal year 1998 confirmed that our
    costs to complete are comparable to DOE's proposed accelerated cleanup
    plan, when adjustments are made to compensate for the scope
    differences. The Corps has also built new cost estimates from the
    bottom up to validate our initial assessment in the Report to Congress.
    These estimates fall within the range provided in the Report to
    Congress.
        Question. General Ballard, the Congress has directed DOE and the
    Corps to enter into a Memorandum of Understanding to carry out the
    program and to eliminate any misunderstandings that may exist between
    the two agencies as to the roles and responsibilities related to the
    FUSRAP cleanup program? What is the status of the MOU and when do you
    expect to have it finalized? What are the remaining sticking points in
    working out a final MOU?
        Answer. The Corps and DOE have entered final negotiations regarding
    the MOU. I anticipate that the final agreement will be signed shortly.
    All major issues have been resolved.
        Question. Last year you indicated that the execution of the program
    was not being hampered by your lack of regulatory authority, or the
    lack of an MOU with DOE. Is this still true? Please explain.
        Answer. It is still true that our execution of the program has not
    been adversely impacted by our lack of regulatory authority under the
    Atomic Energy Act or the lack of a memorandum of understanding with the
    Department of Energy. As I testified last year, we believe that the
    Comprehensive Environmental Response, Compensation, and Liability Act,
    as amended, provides sufficient authority for the Corps to execute
    FUSRAP. In addition, language in the Energy and Water Development
    Appropriations Act, 1999, clarifies Corps cleanup responsibilities
    under FUSRAP.
        Question. The Corps has been in charge of the FUSRAP cleanup effort
    for about 18 months. Update the Committee on the Corps' progress,
    particularly in maintaining cost and schedules since the Corps took
    over the program. What are the most significant issues or problems you
    now face in maintaining the momentum of the cleanup program? How does
    your fiscal year 1998 performance compare to that which DOE had planned
    to execute?
        Answer. During fiscal year 1998, the Corps succeeded in maintaining
    or improving on the schedules which it inherited when responsibility
    for executing the program was transferred to the Corps. In a few cases,
    the Corps developed slightly different schedules based on local
    community involvement and optimizing available resources. We are in the
    process of adjusting our schedules based upon our current funding
    limitations.
        Question. In your report to Congress last March, you indicated that
    your assessment of the program would allow the Corps to complete 16 of
    the sites transferred to you by 2002 with the remaining being completed
    by 2006. Is that assessment still valid? Can you provide a more
    definitive schedule and cost to complete the program?
        Answer. That report provided technical capability without regard to
    any fund constraints. We still believe that with funding to support
    optimal schedules we could complete the remaining sites by 2006. In
    order to do so, however, we would require an appropriation in fiscal
    year 2000 of $264,000,000, in fiscal year 2001 of $217,500,000, in
    fiscal year 2002 of $187,500,000, in fiscal year 2003 of $187,000,000,
    in fiscal year 2004 of $376,500,000, in fiscal year 2005 of
    $82,500,000, and in fiscal year 2006 of $22,000,000.
        Question. What success is the Corps having in establishing clean up
    standards at the various sites left to be addressed?
        Answer. Each site has a set of circumstances unique to that
    individual site, and requires considerable coordination with
    stakeholders and regulators to establish the cleanup criteria. During
    fiscal year 1998 the Corps completed two Records of Decisions
    documenting final cleanup standards. We also completed documentation,
    Engineering Evaluation/Cost Analysis (EE/CA), to carry out interim
    removal actions at five sites. Interim removal actions also require the
    determination of an appropriate cleanup criteria. I believe that we
    have been successful in establishing cleanup criteria which will permit
    us to complete cleanup within the estimated range provided in the
    Report to Congress.
        Question. Since some sites are being completed, what is the process
    for transferring those sites off of the government's books? Is this a
    problem between you and DOE, if so, what is being done to resolve the
    differences between the two agencies? Who will be responsible for long
    term monitoring and site control once cleanup has been completed?
        Answer. The Corps and DOE are in agreement that the Corps would be
    responsible for site surveillance and maintenance during the first two
    years following completion of remedial activities, while DOE will be
    responsible for site surveillance and maintenance after the first two
    years and for the long term. DOE will retain accountability for real
    property during remediation and will be responsible for disposing of
    government owned sites. Now that the broader issues have been resolved,
    the Corps and DOE will develop specific procedures for documenting that
    the cleanup at a site is complete.
        Question. Now, just recently, DOE informed the Corps that an
    additional area, the Dayton sites, is eligible for inclusion in the
    FUSRAP effort. What can you tell the Committee about the potential cost
    impact of the Dayton sites on the annual funding level for FUSRAP? How
    many other additional sites are there that could be eligible for the
    FUSRAP, and how will this additional cleanup requirement impact future
    budgets?
        Answer. At present I am unable to estimate the potential cost
    impact of the Dayton sites. I have requested that our Great Lakes and
    Ohio River Division develop a preliminary cost estimate based on
    sampling data currently available, including information developed by
    DOE in the late 1940's and by the Ohio Environmental Protection Agency
    (OEPA) just last year. We are aware of 18 potential new sites which
    then Secretary of Energy Frederico Pena referenced in his letter to
    Secretary of Defense Cohen around the same time when transfer of
    Program execution to the Corps became effective. We have made no
    attempt to estimate the potential impact of these sites on future
    requirements.
                               program execution
        Question. General Ballard, your statement indicates that the Corps'
    expenditure performance in fiscal year 1998 increased by $400 million.
    How do you account for this increase?
        Answer. Senator, my commanders focused on execution. It is vital
    that they carry out the work that you and the rest of the Congress have
    assigned us. In fiscal year 1998 we had the added work of the FUSRAP
    program and we had a substantial increase in expenditures for the
    Construction, General program. A number of large projects are well into
    their construction cycles thereby generating large expenditures.
        Question. You also indicate that you expect to have another
    improvement in performance in fiscal year 1999. How will you accomplish
    this increase?
        Answer. The majority of the increase will come in the construction
    and maintenance programs. I have made it a top priority of mine to
    execute the program that you have assigned us. It is then a top
    priority of the Division Commanders and they are pressing hard to
    accomplish the projects. In the operation and maintenance program there
    is identified work that can and should be accomplished that will
    require the expenditure of all available funds, about $150 million more
    than fiscal year 1998.
        In the construction program the divisions have laid out schedules
    that will result in expenditures of almost $300 million more than
    fiscal year 1998. My Commanders are continuing to seek ways to improve
    their performance even more. The projects have been funded and we will
    see that they are implemented to serve their intended purpose.
        Question. What is the estimated level of unobligated carryover
    balances into fiscal year 2000 that you don't expect to utilize, and
    what is the reason for this level of carryover balance?
        Answer. We have an estimated unobligated carryover of $724 million
    in direct appropriations into fiscal year 2000. The majority of the
    carryover falls into two appropriations, Construction, General (CG) and
    Flood Control and Coastal Emergencies (FCCE) appropriations. The
    estimated unobligated Construction, General carryover is $447 million.
    Most of this carryover is due to one or more of several reasons. The
    most significant of these reasons are overly optimistic scheduling,
    design delays, environmental problems, problems with local sponsor
    financing, lack of local sponsor, delays in real estate acquisition,
    insufficient authorization, sponsor requested protracted schedule,
    fully funded multiyear projects, and contractor delays. Much of the
    carryover is associated with projects that have had appropriations in
    statutory language, which cannot be reprogrammed for use on other
    projects when delays occur. Most of the funds appropriated to the FCCE
    account are from emergency supplemental appropriations acts. The
    current balance represents carryover of funds appropriated in the
    fiscal year 1997 emergency supplemental appropriations act. This
    balance has been used to fund the emergency preparedness program in
    fiscal year 1999 and will be used to fund that program in fiscal year
    2000.

       Army Corps of Engineers (Civil Works) Fiscal Year 1999 Projected
                             Unobligated Carryover

                             [Dollars in Millions]

                                                                   SCHEDULED
            DIRECT APPROPRIATIONS                                  CARRYOVER

    General Investigations........................................        37
    Construction, General.........................................       408
    Operation & Maintenance, General..............................        70
    FC, Mississippi River & Tributaries...........................        12
    Regulatory Program............................................         4
    General Expenses..............................................        11
    Flood Control & Coastal Emergencies...........................       177
    FUSRAP........................................................         5
                        --------------------------------------------------------------
                        ____________________________________________________

          TOTAL...................................................       724

        Question. General Ballard and General Fuhrman, what is the level of
    deferred critical maintenance work in the civil works program?
        Answer. The backlog of deferred maintenance items is currently
    estimated at $1.6 billion.
        Question. Is this of concern to you?
        Answer. This is of major concern to me. In addition to our mission
    as the nation's water resources problem solvers, we are responsible for
    maintaining a very complex and diversified system of harbors,
    reservoirs, hydropower facilities, locks and dams. So far, we have
    managed to keep our aging infrastructure operating safely with minimal
    down time. When maintenance is put off, it may not be noticed the first
    year, but deterioration worsens with the continued exposure of project
    features to the elements and normal usage. Eventually, conditions can
    no longer be ignored and remedial action is necessary.
        Question. Can you give the Committee an example of the type of work
    which falls into the category of critical deferred maintenance and what
    impacts would be on project operations or efficiencies if failure
    occurred?
        Answer. Some of our deferred work packages are as follows (a)
    replacement of deteriorated miter gates at the Port Allen lock--if the
    old gate sticks or breaks loose, the facility would be shut down; (b)
    additional rip rap to bolster the Jackson Levees--failure to reinforce
    weakened areas could result in a breach and extensive flooding; (c)
    flushing the Los Angeles River subdrain system--a blocked system causes
    excessive hydrostatic pressure on the concrete structure and possible
    failure; (d) repair spillway gates and upgrade overhead crane at
    Millers Ferry Lock and Dam--inoperable spillway gates threaten the
    integrity of the entire embankment and the old crane is becoming
    increasingly difficult and unsafe to operate; and (e) concrete
    guidewall repairs on Okeechobee Waterway--defective guidewalls can
    result in navigation traffic congestion and possible damages to
    transiting vessels which could, in-turn, damage the lock structure,
    causing a shut down.
        Question. Has the Corps evaluated the problem and developed a plan
    to address the issue?
        Answer. I have asked each of the Corps Division Commanders to
    personally evaluate his backlog situation and present to me a plan for
    coming to grips with the issue. The backlog of deferred maintenance is
    very dynamic in nature. As certain previously-deferred items become
    critical, they are included in the budget or addressed with available
    funds during the year of execution. By establishing a goal of expending
    all of available O&M funds during the fiscal year managers at all
    levels have been put on notice to take advantage of any available funds
    for the purpose of reducing the backlog. Our fiscal year 2000 budget
    includes some work that had been previously deferred, but at the same
    time, new items have been added to the list. Although the backlog has
    grown, the fiscal year 2000 budget request reflects a more favorable
    balance between those work items added and those taken off the list.
                             south pacific division
                     acequias irrigation system, new mexico
        Question. Last year, the Committee expressed concerns about the
    progress being made on the Acequias Irrigation system rehabilitation
    project in my State of New Mexico. In addition, the Committee express
    the expectation that the Corps would strengthen its communication and
    coordination efforts with State and local interests. What can you
    report to the Committee in this regard?
        Answer. The Corps has made significant progress in the last year in
    streamlining our processes and strengthening coordination effort with
    local stakeholders. First, with approval of the amended Project
    Cooperation Agreement on March 8, 1999, we will no longer require
    annual review and approval of this agreement by the Corps and our local
    sponsor, the New Mexico Interstate Stream Commission. Second, the
    amended agreement incorporates Section 215 crediting/reimbursement
    provisions allowing the sponsor to design and build projects and
    receive credit for this work toward project cost sharing. Third, the
    amended agreement provides for 100 percent Federal funding of
    ``reconnaissance'' level studies of individual Acequia projects.
    Finally, our environmental procedures are being streamlined through
    preparation of a programmatic environmental impact statement in the Rio
    Chama Basin. The Fish and Wildlife Service has prepared a draft
    Coordination Act Report for the basin as well. We expect these changes
    to accelerate project construction in the near future.
              upper rio grande water operations model, new mexico
        Question. The Committee requested a report, in consultation with
    the Bureau of Reclamation, on the Corps' progress and plans to complete
    the Upper Rio Grande Water Operations Model in New Mexico. What is the
    status of that report?
        Answer. The report has been drafted and forwarded to our Washington
    level headquarters. It will be forwarded to the Army and, subsequently,
    to the Committee shortly.
        Question. Funding was provided by the Congress for the current year
    to award a construction contract on the Dushore, Sullivan County
    Pennsylvania small project. What is the status of and schedule for
    completing plans and specifications, and awarding the construction
    contract of the project?
        Answer. Following completion of a feasibility study for this
    project at Loyalsock Creek, Borough of Dushore, Sullivan County,
    Pennsylvania, in March 2001, the Corps of Engineers is scheduled to
    initiate plans and specifications and these would be completed in
    December 2001. A construction contract award is set for March 2002.
                         technical centers of expertise
        Question. General Ballard, I have some question regarding a recent
    policy directive you issued, which restructured the project approval
    process for Technical Center of Expertise (TCX), and its specific
    effects on the St. Louis TCX, the Center of Photogrammetric Mapping.
        I understand, and I believe you are aware, General Ballard, that
    the St. Louis Center received its TCX designation in 1995 in
    recognition for the unique specialized expertise it had developed in
    the area of photogrammetry, Geographic Information Systems (GIS),
    Global Positioning Systems, civil engineering and remote sensing, among
    others. Due to its expertise, the Center has developed a large non-COE
    customer base and heavy workload, with a vast majority of these
    projects short term and in the $50,000 to $150,000 range--which is
    relatively small. Furthermore, almost 100 percent of the project work
    is contracted out to the private sector, allowing for a significant
    amount of firms to grow and prosper around this work.
        General Ballard, as you are also aware, recently the Corps
    restructured the process by which a Technical Center of Expertise can
    do work for customers outside of its particular District. Is it now
    necessary for the [St. Louis District Photogrammetric Mapping Technical
    Center of Expertise] to receive approval from both Corps HQ as well as
    the district in which the work is to be done, whether or not the work
    is to be done in support of assigned Corps missions or for non-COE
    customers? Is all this correct?
        Answer. It is not necessary for a Center of Expertise (CX) to
    obtain Headquarters approval to work for customers outside its
    particular district. However, the Corps recently introduced a
    requirement that there be coordination between division offices before
    an activity, including a CX, in one division performs work outside the
    geographical boundaries of that division. The Corps established this
    requirement to ensure that division commanders would have complete
    responsibility for the flow of work within their geographic area of
    responsibility. This is central to the Corps regional business center
    concept which we have established to maximize our organization's
    effectiveness and efficiency in delivering services to our customers.
        Question. Is it true that the nature of most of the projects, which
    the St. Louis Center undertakes on behalf of non-COE clients, require a
    high level of technical understanding as well as a rapid response
    capability?
        Answer. Much of the facility engineering and natural resources
    photogrammetric mapping performed by the St. Louis District requires
    highly skilled technical expertise; in many case a rapid response is
    also required.
        Question. Is this same level of expertise available elsewhere
    within the Corps? If so, why was St. Louis designated a TCX in 1995 and
    labeled the Center for Photogrammetric Mapping?
        Answer. The St. Louis District was designated as a Technical Center
    of Expertise in 1995 because of its superior combination of technical
    expertise, project management experience, and contracting capability in
    photogrammetric mapping. Under revised regulatory guidance, which
    eliminated the Technical Center of Expertise classification, the
    technical expertise of Photogrammetric Mapping Center has been
    recognized through its listing on the Directory of Expertise (DX).
    However, some other districts also have the technical expertise in
    photogrammetric mapping and contracting experience sufficient to meet
    many requirements.
        Question. Has the restructuring of the approval process had a
    negative effect on the ability of the Center for Photogrammetric
    Mapping to respond rapidly, which, in the past, outside clients have
    come to both expect and depend upon.
        Answer. There have been some instances in which the requirement to
    coordinate with another division in order to do work outside the
    assigned geographical boundaries has caused delays in initiating aerial
    mapping photography for customers. They can reasonably be expected to
    diminish as Corps activities, including the CX, become familiar with
    the new procedures, and develop and implement measures to streamline
    the coordination process.
        Question. Is it not true that, since implementation of the
    restructuring, the project load of the St. Louis TCX has dropped off,
    as clients have sought and found alternative contracting avenues
    besides the Corps, such as the US Geological Survey and the Tennessee
    Valley Authority, which are not restricted by a lengthy and
    unpredictable approval process?
        Answer. I am aware that there have been specific instances when
    other activities have sought and found alternative contracting avenues
    besides the Corps, such as the US Geological Survey and the Tennessee
    Valley Authority, as a result of the requirement that the CX coordinate
    with another division in order to do work outside the geographical
    boundaries of its division.
        Question. Do you believe that, as a result of a possible loss of
    work, the inflow of funds will substantially decrease, thus restricting
    the ability of the [St. Louis District] Center for Photogrammetric
    Mapping to continually build upon its resource base and not even
    increase, but maintain its technical edge?
        Answer. I believe that the Photogrammetric Mapping Center may
    experience some loss of workload in the short term as a result of our
    requirement that use of the CX be coordinated across division
    boundaries. However I am confident that over the long term, as a result
    of providing superior service and streamlined approval procedures, the
    TCX will be able to maintain a workload which will sustain the current
    level of technical expertise.
        Question. Hasn't this restructuring that you have ordered--
    protracted response process, decreased workload and diminished level of
    expertise--directly conflicted with the Corps strategic mission of
    becoming more streamlined and responsive to non-COE clients, also known
    as the ``Support for Others'' program?
        Answer. While there have been delays in the processing of requests
    for photogrammetric mapping support by the CX, I believe that the
    number and length of these delays will decrease as Corps activities,
    including the CX, become familiar with the new procedures and develop
    and implement measures to streamline the coordination process.
    Furthermore, I believe that, on balance, the Corps regional business
    center concept will maximize our organization's effectiveness and
    efficiency in delivering services to our customer.
        Question. Is it correct that by taking the simple step of
    reclassifying the St. Louis District Center for Photogrammetric Mapping
    from a Directory of Expertise to a Mandatory Center of Expertise, the
    Center would be recognized as possessing unique technical expertise and
    management skills, and thus be allowed to perform work for others
    without the restricting additional layers of review?
        Answer. The St. Louis District's Photogrammetric Mapping Center has
    previously been recognized as possessing unique technical expertise and
    management skills through its listing on the Directory of Expertise
    (DX). I fully expect this listing to be renewed. However, performing
    work for others outside the Mississippi Valley Division's geographical
    area of responsibility, without prior coordination with the division
    having responsibility for the area where the work is located, would be
    inconsistent with the regional business center concept.
        Question. Is it not true that an internal Corps review of this
    reclassification of St. Louis District] has indeed already been
    conducted, with no adverse impact found on either the Corps or the
    private sector?
        Answer. The Corps initial Approval Request Report for a Mandatory
    Center of Expertise designation for St. Louis District did not identify
    any adverse impacts on either the Corps or the private sector. What was
    decisive in this case, however, was the inconsistency of the MCX
    designation with the concept of regional business process centers.
        Question. Is it not also true that the reclassification process was
    in its final stages as early as last November, receiving all of the
    required civilian signatures and half of those needed from military
    personnel?
        Answer. There were differing opinions on my staff. That is not
    uncommon. However, after weighing the pros and cons of the
    alternatives, as presented by my staff, I decided that the best course
    was not to designate the St. Louis District as a Mandatory Center of
    Expertise.
        Question. Why did this process come to a complete standstill?
        Answer. The process did not come to a complete standstill. However,
    because of the differing opinions on my staff, the process took longer
    than might originally have been anticipated.
        Question. The inability of the Corps leadership to reclassify the
    St. Louis Center as a Mandatory Center of Expertise will clearly have
    an adverse impact upon not only the Center, but all photogrammetric and
    GIS activities that the Corps undertakes. Efficiency will be reduced,
    increased personnel will be required and costs will rise--do you
    believe that the Corps has sufficient resources and manpower available
    to handle these increased costs and personnel?
        Answer. Although there may be some initial impacts on the St. Louis
    District's photogrammetric mapping program, I do not believe that there
    will be a long term adverse impact on the St. Louis District nor an
    adverse impact on the Corps as a whole. On balance, I believe that our
    regional business center concept will increase our efficiency and
    effectiveness in serving our customers.
                                     ______

                     Questions Submitted by Senator Cochran

                       mississippi river and tributaries
        Question. The budget request for the Mississippi River and
    Tributaries program remains at $280 million, the same amount requested
    for fiscal year 1999. What is the Corps capability for this program?
        Answer. The Corps capability for the Mississippi River and
    Tributaries program is $350 million.
        Question. Is there a funding level for this account which will
    obviate the need for earmarks, while allowing work to continue on
    priority projects?
        Answer. The President's budget for the Mississippi River and
    Tributaries program in fiscal year 2000 is $280 million. The budget
    would allow work to proceed on all projects, albeit not on optimal
    schedules.
                            mississippi river levees
        Question. What is the status of the ongoing work to address
    deficiencies on the mainline Mississippi River levees?
        Answer. Construction continues on the Mississippi River Mainline
    Levee and Berm Enlargement project, to bring the levees up to grade and
    otherwise assure the capability of the levee system to successfully
    pass the project flood. A Supplemental Environmental Impact Statement
    was completed and a Record of Decision was signed on 5 October 1998.
    Construction of most work items scheduled to commence in fiscal year
    1997 and fiscal year 1998 has proceeded during preparation of the
    Supplemental Environmental Impact Statement and is either complete or
    nearing completion. The Corps expects to award the next two
    construction contracts in May and June 1999, for work items located in
    Missouri and Mississippi. These work items represent levee enlargements
    for the purpose of eliminating levee grade deficiencies at critical
    reaches of the levee system. On 4 December 1998, EARTHJUSTICE Legal
    Defense Fund, Inc., challenged the adequacy of the Supplemental
    Environmental Impact Statement.
        A hearing is tentatively scheduled for late May 1999. The Corps is
    proceeding with planned fiscal year 1999 work, neither expediting nor
    delaying work due to the litigation.
                              natchez, mississippi
        Question. What is the status of work to address erosion on the
    bluffs in and around the city of Natchez, Mississippi?
        Answer. A portion of the top priority reach, Area 3, Clifton
    Avenue, was constructed in 1997 by the Natural Resource Conservation
    Service under its Emergency Watershed Protection Program. Construction
    of the remainder of Area 3 is presently underway by the Corps of
    Engineers and scheduled for completion later this year. A Project
    Cooperation Agreement was executed in March 1998 and the construction
    contract awarded in June 1998. Preparation of a Project Cooperation
    Agreement amendment, supporting documents, and design covering the next
    priority reach, Area 4, Madison Street to State Street, is currently
    underway, and every effort is being made to accelerate activities to
    award a construction contract for Area 4 this fiscal year.
        Question. How much funding is needed within the existing
    authorization?
        Answer. Sir, through fiscal year 1999, $12,500,000 has been
    appropriated. The total additional amount considered necessary to fully
    fund the remaining authorized work is $7,049,000. This includes funding
    the remaining work on Area 4, Madison Street to State Street at a cost
    of $3,769,000; and the remaining two authorized reaches--Area 6, Bluff
    above Silver Street, $1,110,000 and Area 7, Bluff above Natchez Under-
    the-Hill, $2,170,000.
        Question. What work needs additional authorization?
        Answer. Sir, additional authorization would be required for the
    Corps to construct additional features sought by the local sponsor,
    which are: bluff stabilization measures in Area 1, Weymouth Hall, Area
    2, Between Weymouth Hall; and Park Street; and Area 8, D.A. Biglane
    Street. Bluff stabilization for Area 5, Silver Street has been
    accomplished by the city, and no additional work or authorization is
    required for this area.
        Question. What is the estimated cost of this work?
        Answer. The estimated cost of construction for Areas 1, 2 and 8 is
    $13,935,000. This would increase the total first cost of the authorized
    project from $26,065,000 to $40,000,000. The estimated Federal cost
    would be approximately $30,000,000 and the estimated non-Federal cost
    would be approximately $10,000,000.
                          jackson county, mississippi
        Question. What is the status of the Jackson County, Mississippi,
    water supply project?
        Answer. Sir, the non-Federal sponsor, Jackson County, Mississippi,
    is preparing the construction plans and specifications which are
    scheduled for completion in April 1999. The Project Cooperation
    Agreement is scheduled to be signed in July 1999. The construction
    contract is scheduled for award in November 1999, with completion in
    January 2001.
        Question. How much funding is needed within the existing
    authorization?
        Answer. Sir, the existing funding authorization is $10,000,000. We
    have received $9,200,000 to date through Congressional Adds. Therefore,
    an additional $800,000 is needed to fulfill the existing authorization.
        Question. What work needs additional authorization?
        Answer. Sir, the project calls for expansion of the Jackson County
    industrial water supply system in segments based on funding
    availability. Jackson County has already constructed a portion of the
    total project and desires to use Corps funding in the construction of
    the remaining project.
        Question. What is the estimated cost of this work?
        Answer. Sir, the estimated cost of this work is $5,000,000.
                coastal environmental impact study, mississippi
        Question. It is my understanding that the Corps has undertaken a
    coastal environmental impact study for the Gulf Coast of Mississippi.
    What is the purpose and scope of this study?
        Answer. Sir, The Mississippi Gulf Coast has been developed by the
    casino industry at a greater rate than was envisioned by either the
    State of Mississippi or the Federal agencies when Mississippi first
    allowed gaming on navigable waters. As a result, existing casinos have
    developed most of the coastline previously used for commercial and
    industrial facilities. New casino applicants must obtain Department of
    the Army permits to build in environmentally sensitive areas in
    Harrison and Hancock Counties, MS. Additionally, other large projects
    such as malls and subdivisions are also being proposed to locate in
    these same sensitive areas. We believe it is necessary and timely to
    undertake a Coastal Environmental Impact Statement (CEIS) to determine
    the likelihood and number of additional casinos locating on the
    Mississippi Gulf Coast in the future, estimate the numbers of other
    large-scale projects, and do a broad study of the environmental
    consequences of these future casinos and projects. The scope of the
    CEIS is expected to encompass the coastline of Harrison and Hancock
    Counties, and extend landward about one mile north of Interstate 10.
        Question. What is the estimated cost of this study?
        Answer. Sir, The estimated cost of this study is approximately
    $750,000.
        Question. Is the necessary funding included in the President's
    budget?
        Answer. Sir, the Regulatory Program fiscal year 2000 Budget request
    includes $325,000, which is sufficient to continue this study effort.
        Question. What is the schedule of work for this study?
        Answer. Sir, the study will be initiated in June 1999, and is
    scheduled for completion in September 2001.
                         demonstration erosion control
        Question. Please provide a summary of all ongoing Demonstration
    Erosion Control (DEC) projects in Mississippi. Please include total
    estimated cost of each and funding to date.
        Answer. The total estimated cost of ongoing work in the Black Creek
    Watershed is $3,495,000 of which $1,398,000 has been provided for work
    on 1 riser pipe, 1 floodwater retarding structure and 2 bank
    stabilization items.
        The total estimated cost of ongoing work in the Hurricane-Wolfe
    Watershed is $375,000, of which $351,000 has been provided for work on
    15 riser pipes.
        The total estimated cost of ongoing work in the Coldwater River
    Watershed is $1,879,000, of which $1,094,000 has been provided for work
    on 2 low drop structures, 3 box culvert, and 1 bank stabilization.
        The total estimated cost of ongoing work in the Abiaca Creek
    Watershed is $2,308,000, of which $441,000 has been provided for work
    on 1 levee and 1 riser pipe.
        The total estimated cost of ongoing work in the Batupan Bogue
    Watershed is $2,615,000, of which $2,226,000 has been provided for work
    on 2 low drop structures, and 3 bank stabilizations.
        The total estimated cost of ongoing work in the Cane--Mussacuna
    Watershed is $439,000, of which $189,000 has been provided for work on
    1 low drop structure.
        The total estimated cost of ongoing work in the Hotophia Creek
    Watershed is $350,000, of which $325,000 has been provided for work on
    1 low drop structure.
        The total estimated cost of ongoing work in the Otoucalofa Creek
    Watershed is $1,876,000, of which $951,000 has been provided for work
    on 1 channel improvement, 1 riser pipe, 1 low drop structure, and 1 box
    culvert.
        The total estimated cost of ongoing work in the Yalobusha River
    Watershed is $1,755,000, of which $1,618,000 has been provided for work
    on 2 riser pipes, 2 low drop structures, and 3 box culvert.
        The total estimated cost of ongoing work in the Toby Tubby Creek
    Watershed is $2,527,000, of which $275,000 has been provided for work
    on 1 floodwater retarding structure, and 1 bank stabilization.
        Additionally, $5,000,000 has been provided for engineering and
    design, construction management, data collection and monitoring
    activities, and approximately $850,000 has been provided for lands and
    relocation activities which will be expended throughout these
    watersheds.
        In summary, work with an estimated total cost of $26,469,000 has
    been initiated in ten watersheds. Of the total cost, $14,718,000 has
    been provided through fiscal year 1999 with a balance to complete of
    $11,751,000. The fiscal year 2000 budget request of $6,294,000 will
    allow completion of all contracts scheduled for award in fiscal year
    1999. The budget does not, however, propose to continue the program and
    does not include funding for additional contracts in fiscal year 2000
    or beyond.
        Question. Please also provide a list of all DEC watersheds.
        Answer. A list of the authorized watersheds in the Demonstration
    Erosion Control project include: Black Creek; Hurricane-Wolfe;
    Coldwater River; Abiaca Creek; Batupan Bogue; Cane-Mussacuna; Hickahala
    Creek; Hotophia Creek; Long Creek; Otoucalofa Creek; Yalobusha River;
    Pelucia Creek; Toby Tubby Creek; Burney Branch; Sherman Creek; and Town
    Creek.
                                     ______

                     Questions Submitted by Senator Bennett

                   regulatory program--administrative appeal
        Question. Why hasn't the Corps done as Congress and the President
    instructed by creating an appeals program that allows for
    jurisdictional challenges?
        Answer. The President's budget for the last two years has included
    funding requests for the Regulatory Program that provided for the full
    appeals program. However, the appropriations for these years have been
    significantly below the requests. The Corps has difficulty maintaining
    its staffing levels in the districts to cover the basic program
    services. At the appropriations levels enacted, the Corps could not
    implement the full appeals program without making significant
    reductions to the basic services. The Corps has worked hard to improve
    its regulatory services to the public and does not want those services
    to be degraded.
        Question. What has the Corps done with the monies (both fiscal year
    1998 and fiscal year 1999) that were specifically earmarked, at the
    request of the Corps, for the implementation of the administrative
    appeals process?
        Answer. The Army budgeted for the administrative appeals process in
    fiscal year 1998 and fiscal year 1999 but did not request that the
    funds be earmarked. The Appropriations Committee report language stated
    the intentions of the Committee to have a full appeals process
    implemented. However, the appropriations we received in the fiscal
    years you mention were well below the President's budget requests which
    would have funded the full appeals process without sacrificing services
    to the public. More citizens depend on our responsiveness to their
    permit applications than the number that would use the appeals process.
        The Regulatory Program is a labor-intensive program and, as such,
    requires a 2-3 percent increase in funds each year just to maintain
    staffing levels. Most of the Regulatory funds in these years was
    prudently used to maintain staffing levels of the districts in order to
    continue providing timely, equitable services to the public. In fiscal
    year 1999, we have been able to set aside some funds for the appeals of
    permit denials and conditions which will become effective on August 6,
    1999.
        Question. One of the purposes of the 1993 wetlands plan is that the
    regulatory program must be efficient, fair, flexible and predictable,
    and must be administered in a manner that avoids unnecessary impacts
    upon private property and the regulated public. The administrative
    appeal was designed to ``increase fairness in the wetlands permitting
    process.'' Yet the Corps has implemented an appeals program that is
    opposed by the regulated community and only increases the burden on
    private property owners. Why has the Corps implemented an appeals
    program that contradicts the Presidents instructions?
        Answer. The Corps has heard from members of the regulated community
    that they are pleased we have an appeals process for permit denials and
    conditions going into effect this year. Many in the development
    community wish we had gone further and adopted the appeals process for
    jurisdictional determinations as well. However, at five times the cost
    of appeals of denials and conditions, the cost of jurisdictional
    appeals has not made its implementation feasible.
        The President's budget requests have included the funds for a full
    appeals process and they have been specific as to the costs required to
    fund it. These requests also included funds to maintain current staff
    in order to ensure other services do not decline. In the fiscal year
    1998 appropriation, there was a program increase equivalent to the cost
    of the appeals program, but no funds were provided to cover the labor
    cost increases needed to maintain the rest of the regulatory program.
    After three years of level funding at $101 million, the program was
    unable to maintain its staffing level and even today the districts have
    many vacancies. We believe that we would have unfairly sacrificed the
    basic services of the program (e.g., timely decisions and protection of
    the environment) and reversed the progress made to improve these
    services if we had set aside $5 million for jurisdictional appeals that
    would benefit fewer members of the public.
        Question. In fiscal year 1997, the Corps acted on 65,138 Section
    404 permit applications. Out of those, there were only 28 individual
    permit denials. As the Corps has most recently indicated that it plans
    to only implement a partial administrative appeals process for only
    permit denials, the Corps appears prepared to spend about $180,000 per
    permit denial. Meanwhile, property owners who disagree with the Corps
    over their jurisdictional determinations will still have to spend over
    a year in the permitting process before having ability to challenge the
    decision in court. Please justify the Corps decision to focus both its
    regulatory efforts and increased budget on a program already subjected
    to direct judicial review and how you believe this to be a fair an
    equitable process.
        Answer. While we have supported the implementation of
    administrative appeals, the problem has been the affordability of a
    full appeals process and its impacts on the other parts of the
    Regulatory Program. Our cost estimate for appeals of permit denials and
    conditions is $1 million per year. The cost to implement a
    jurisdictional appeals process is estimated to be $5 million. To have
    dedicated $5 million from an already austere program for the full
    process would have meant shortages of regulatory personnel in the
    districts. This would have meant cutting back on other services. The
    program impacts a sizable segment of the public through its permit and
    enforcement-resolution programs. While everyone recognizes the
    advantages of jurisdictional appeals, it does not make sense to cut
    basic services in order to spend money on an activity which would
    benefit a much smaller group.
        A wetland delineation does not restrict an applicant from using his
    or her property. He or she has to apply for a permit if the activity is
    in a wetland. The Corps' performance goal is to evaluate permit actions
    within 60 days, and the most recent analysis or performance data showed
    that this goal is achieved 95 percent of the time. If the permit is
    disapproved, or approved with certain conditions, then the applicant
    can bring a lawsuit against the Corps to challenge the delineation. In
    addition to 31 permit denials in fiscal year 1997, there also were
    5,000 permits issued that were subject to conditions. These will be
    subject to the existing appeals process.
        Everyone agrees that the appeals process is less expensive and less
    time consuming than litigation. The Corps' experience has been that
    most applicants are satisfied with a fair hearing in the local Corps
    district office, even if they do not get the result they want. We want
    the permit process to be fair and equitable to our citizens and we do
    not believe that litigation is the best way to resolve most
    differences.
        Question. As indicated in the 1999 Conference Report, the
    implementation of an administrative appeals process for only permit
    denials is unacceptable. Furthermore, the Conference Report language
    directs the Corps to demonstrate its progress in implementing a full
    administrative appeal process when it requests its fiscal year 2000
    budget. Why has the Corps recently insisted that it will only implement
    a program that addresses permit denials and stated publicly that it
    needs more money to implement a full program, against the express
    instructions of Congress?
        Answer. The Army's position is to support Committee report language
    as fully and as best as we can, within the resources provided in
    appropriation acts. However, the appropriations we received in recent
    years were well below the President's budget requests. To have
    dedicated $5 million from our already austere program for the full
    process would have meant shortages of regulatory personnel in the
    districts. The public would suffer because, with fewer team members to
    evaluate permit applications, backlogs would grow and private citizens
    and businesspersons would have to wait longer to receive a permit. The
    permit program serves more citizens than would the appeals program so
    we decided that a phased implementation would work best for the program
    and the public. We believe that we would be doing the Nation a
    disservice by drastically curtailing or eliminating the other program
    activities in order to implement fully the administrative appeals
    program.
        We have complied with the Congressional direction in the Committee
    report language as best as we could, consistent with our commitment to
    provide fair and responsive services to the public. The final
    regulation for appeals of permit denials and conditions was published
    in the Federal Register on March 9, 1999, with an effective date of
    August 6, 1999. Permit denials and conditions made on or after March 9,
    1999 are subject to this appeals process. The August implementation is
    necessary to recruit and train the appeals staff.
        The process for the appeals of jurisdiction determinations is more
    complex and labor intensive. With the levels of funding for the
    Regulatory Program in recent years, the Corps has been unable to start
    up this part of the appeals process without compromising its services
    to the public. However, the Corps is making progress on drafting a
    jurisdictional appeals regulation and should be able to implement
    appeals of jurisdictional determinations in early fiscal year 2000 if
    the requested funds are appropriated.
                                     ______

                          Questions Submitted by Burns

                               regulatory program
        Question. I am concerned about the Army Corps of Engineers new
    final rule on administrative appeals to Section 404 permits as
    published in the March 9 Federal Register. As I recall, the President,
    in his Wetlands Plan of 1993, directed the Army Corps of Engineers to
    establish an administrative appeals process for Section 404 permits.
    However, I understand that the final rule on administrative appeals
    will deal only with appeals of denied Section 404 permits, not appeals
    of jurisdictional determinations. Lacking this later provision disturbs
    me especially since Congress rejected this notion last year of not
    allowing the public to appeal jurisdictional determinations of the
    Corps. Why do you insist on not allowing such appeals when you stated
    in your March 10 testimony that you allow these types of appeals with
    the fiscal year 2000 budget?
        Answer. The President's fiscal year 2000 budget request for the
    Regulatory Program includes funds for implementation of an appeals
    program for jurisdiction determinations. It would be implemented by a
    separate regulation published in the Federal Register. In fiscal year
    1999, the Corps is implementing a system for appeals of permit denials
    and conditions within the appropriation of $106 million.
        The Corps has worked very hard to improve its services to the
    public and run a program that is fair to landowners and commercial
    developers while still protecting wetlands. If the Corps were to go
    ahead with jurisdiction appeals in fiscal year 1999 at the current
    funding level, many basic permit evaluation and related services would
    have to be reduced to cover the costs of jurisdiction appeals. I would
    not like to see these services degraded. An appeals process for
    jurisdiction determinations is another step in the right direction, but
    the Corps needs the resources to implement it without sacrificing the
    basic services which the public expects and deserves.
        Question. You recall Congress's strong language in the fiscal year
    1999 appropriations to the Corps that not including appeals for
    jurisdictional disputes was unacceptable and that the Corps needed to
    demonstrate its progress to implement a ``full administrative appeals
    process'' with its fiscal year 2000 Budget request. You also remember
    that $5 million was provided in fiscal year 1999 to implement this
    administrative appeals process. Given this guidance along with the $5
    million provided, why should not Congress rescind these funds given
    your new final rule?
        Answer. The Corps is drafting regulations for the jurisdiction
    appeals which we hope to have completed this year for implementation in
    fiscal year 2000. As I stated earlier, appeals of permit denials and
    conditions will begin this year. The fiscal year 1999 appropriation was
    the same amount as the fiscal year 1998 appropriation and both were
    well below the requested amounts. The Regulatory Program has been
    struggling to cover basic services for several years because
    appropriations have not kept pace with the increasing program demands
    and costs. The fiscal year 1998 increase of $5 million, the only
    increase since fiscal year 1995, was used to cover basic labor-related
    costs such as salaries, training of regulatory personnel, and travel to
    permit sites. Overall staffing had declined due to three years without
    a budget increase. The population that will benefit from the appeals
    program is small compared to the general public who depend upon the
    Corps for permit evaluations, enforcement and resolution.
        Question. If you believe lack of funding is part of the problem to
    administer an appeals program for jurisdictional disputes, why haven't
    you raised program fees to generate additional funds? What has been
    done with the money previously allocated by Congress to begin
    implementing a jurisdictional appeals process?
        Answer. The President's budget includes proposed appropriations
    language concerning regulatory permit fees. The Corps has not changed
    its fee structure since 1977. The proposal in the President's budget
    would authorize the Secretary of the Army to pursue reasonable changes
    that the Corps would adopt following notice and comment rulemaking. The
    objective is to consider changes that would make the fees more
    equitable and reduce the net Federal costs associated with the
    Regulatory program. Under the proposal, the revenues would be credited
    as offsetting collections, not added to the Regulatory Program account.
        The fiscal year 1998 appropriation of $106 million was an increase
    of $5 million over the previous appropriations that had been held to
    $101 million in fiscal year 1995, 1996, and 1997, all of which were
    well below the President's requests. Most of the increase was used to
    cover labor costs, including filling vacancies in the districts. As a
    result of the level funding during these years, the Corps lost some
    district staff and basic program services were being affected.
        Because of the constrained funding, the Corps was not able to fully
    satisfy the Appropriations Committee report language regarding
    administrative appeals. In fiscal year 1998, however, the Corps did
    begin steps to implement the program for appeals of permit denials and
    conditions, at an annual cost of $1 million. To have dedicated $5
    million for the full appeals process would have had too severe an
    impact on the basic services.
        Question. You are familiar with the recent decision by the U.S.
    Court of Appeals for the 4th Circuit in U.S. v. Wilson. In that case
    the court found invalid the Corps/EPA rule which asserts federal
    jurisdiction over an isolated wetland--a wetland not directly connected
    or adjacent to interstate waters--on the basis that degradation of the
    wetland could affect interstate commerce. The court required the
    existence of an actual effect on interstate commerce before the Corps
    could claim jurisdiction over the wetland. However, the Corps chose to
    apply the court's holding only within the five states that comprise the
    4th circuit: Maryland, Virginia, West Virginia, North Carolina and
    South Carolina. The result is a federal regulatory program that is
    broader in 45 states and narrower in 5 states. How do you justify this
    uneven federal jurisdiction? Why not apply the court's holding
    throughout the nation? What is wrong with requiring a finding of an
    actual connection to interstate commerce before the federal government
    regulates private land?
        Answer. While we agree that all states should be regulated
    consistently, we do not agree with the court holding in the Wilson
    case. We are currently considering issuing a regulation to clarify the
    Clean Water Act jurisdiction for isolated wetlands that would be
    applicable nationwide. The Fourth Circuit decision is only required to
    be applied within the Fourth Circuit. In this regard, we have issued
    interim guidance within the Fourth Circuit to comply with the court's
    decision while we develop the national regulation. While documenting an
    actual connection to interstate commerce would be possible in almost
    all cases, this approach would result in substantial delays and
    unnecessary work for the Corps and permit applicants.
        Question. I understand the Corps has recently proposed to severely
    restrict the use of streamlined permits for minor projects--so-called
    nationwide permits--in wetlands near ``impaired'' waters, in ``critical
    resource'' waters and wetlands, and in the 100-year flood plain. This
    proposal is likely to halt many projects that are minor and routine,
    but nonetheless important to public and private entities alike. Can you
    tell me how much of the United States is in the 100-year flood plain?
        Answer. The Corps estimates that approximately 8 percent of the
    land area in the continental United States is within the 100-year flood
    plain.
        Question. How much of the 100-year flood plain is federal
    jurisdictional wetlands?
        Answer. The Corps estimates that approximately 35 percent of the
    100-year flood plain consists of wetlands that are subject to Section
    404 of the Clean Water Act.
        Question. How much of the wetlands within the 100-year flood plain
    are affected by authorizations under the nationwide permit program?
        Answer. Nearly all of the 30 current nationwide permits that
    authorize Section 404 activities could be used to authorize discharges
    into wetlands within the 100-year floodplain. While all of the wetlands
    in the 100-year floodplain could be affected by the NWP program, most
    wetlands in the 100-year floodplain would not be affected by any
    specific NWP authorization. During 1997, for example, 21,176 acres of
    non-tidal wetlands were filled under general permit authorizations,
    including NWP authorizations. Many of these non-tidal wetlands are
    outside of the 100-year floodplain. We estimate that there are
    approximately 55,000,000 acres of wetlands in the 100-year floodplain.
    Therefore, only a small proportion of the wetlands in the 100-year
    floodplain are filled as a result of activities authorized by
    nationwide permits.
        Question. What is the effect on flood control of the activities
    authorized by nationwide permits in wetlands in the 100-year flood
    plain?
        Answer. Activities that result in permanent, above-grade wetland
    fills in the 100-year flood plain will decrease the flood-holding
    capacity of that floodplain. Unless that loss of flood-holding capacity
    is mitigated, that 100-year flood plain will increase in area,
    resulting in the flooding of a wider area during 100-year storm events
        Question. How does this proposal square with Congress' intent
    expressed in 1977 when it provided authority to allow nationwide
    permits and that the nationwide permits program was to be an integral
    part of the Section 404 regulatory program?
        Answer. The proposal to prohibit the use of certain NWPs to
    authorize permanent, above-grade wetland fills in the 100-year flood
    plain is not contrary to the Congressional intent of 1977, because only
    certain activities would be subject to this prohibition. Congress also
    indicated that the NWPs were for activities that have minimal
    individual and cumulative effects. This proposal will help ensure that
    this standard is met. Some activities in the 100-year flood plain could
    be authorized by other NWPs.
        It is important to note that NWPs are optional permits. If the
    landowner cannot comply with all conditions of the NWP, then he or she
    can apply for authorization through the individual permit process, or
    request authorization through a regional general permit, if such a
    permit is available for the proposed activity. We are considering ways
    to maximize protection of the 100-year flood plain capacity while not
    unnecessarily restricting use of NWPs.
        Question. According to the Corps' own data, in fiscal year 1997
    under the nationwide permits program, about 16,000 acres were permitted
    across the country--about 320 per state. In return, the Corps required
    the restoration of 28,600 acres as mitigation for the authorized
    impacts--about 572 per state. As a result, isn't there a net gain of
    12,600 acres nationwide under the nationwide permits program--about 252
    acres per state?
        Answer. The data in your question is cited in the July 1, 1998,
    Federal Register notice that contains the proposed NWPs to replace NWP
    26. The figures, however, are for activities authorized by the Corps
    through the standard permit process. For general permits, including
    NWPs and regional general permits issued by Corps district offices, the
    Corps required approximately 24,800 acres of compensatory mitigation
    (including the restoration, creation, enhancement, and preservation of
    aquatic resources) for approximately 21,400 acres of waters of the
    United States lost due to activities authorized by general permits. The
    net gain from activities authorized by NWPs and regional general
    permits during 1997 was 3,400 acres. Since the Corps databases combine
    impacts and mitigation figures for both NWPs and regional general
    permits, the Corps cannot separate how much of the wetland losses and
    gains are due to NWP activities. Also, some of the mitigation was for
    preservation of existing wetlands.
        Question. If there is this kind of gain of wetlands, rather than
    loss, why are the restrictions proposed by the Administration
    necessary?
        Answer. Each year we spend over $7 billion for flood damages. As a
    matter of policy we do not believe that we should encourage development
    of our flood plains. The purpose of the proposed flood plain
    restriction is to address concerns about public health and safety by
    reducing the loss of life and property caused by flooding, safeguarding
    sources of drinking water supplies, and protecting and restoring the
    natural functions of the Nation's flood plains. It is important to note
    that, although there is some wetland gain as a result of activities
    authorized by general permits, wetland gain is not necessarily
    providing additional flood-holding capacity or reducing flood hazards.
    For example, wetland restoration, creation, or enhancement activities
    required for wetland losses in the 100-year flood plain that are
    authorized by general permits may be conducted off-site and outside the
    100-year flood plain.
        Question. According to the Corps' own data, mining activities under
    the new proposed nationwide permit for mining activities will impact
    145 acres of wetlands nationally, or 2.90 per state. If this is not a
    minimal impact, what is? Why is it necessary to further restrict the
    use of the proposed nationwide permit for mining activities?
        Answer. Mining activities affect more than wetlands. These
    activities can have substantial adverse effects on streams and
    economically important fish species, such as endangered salmon, that
    inhabit those streams.
        Question. With respect to ``impaired waters,'' which is not defined
    in the Administration's proposal, how many waters will be designated as
    ``impaired,'' and thereby off-limits to use of the streamlined
    nationwide permits under this proposal?
        Answer. Based on data in a report published by the Environmental
    Protection Agency in 1996, approximately 252,000 river miles, 6.55
    million acres of lakes, ponds, and reservoirs, 4,730 shoreline miles of
    the Great Lakes, and 11,155 square miles of estuarine waters in the
    United States are considered ``impaired. `` According to this report,
    few states have developed criteria to determine if the loss of wetlands
    is the cause of the waters being designated as impaired. As for the NWP
    restriction, the Corps is considering using the State lists, which are
    produced in accordance with Section 303(d) of the Clean Water Act, to
    determine which waters are impaired. The sources of impairment subject
    to the NWP restriction include nutrients, organic enrichment resulting
    in low dissolved oxygen concentration in the water column,
    sedimentation and siltation, habitat alteration, suspended solids, flow
    alteration, turbidity, or the loss of wetlands. We are considering
    allowing the NWPs to authorize activities in impaired bodies of water,
    provided the authorized activity, plus any required mitigation, results
    in net improvement of the aquatic ecosystem of the impaired water.
        According to this 1996 report, approximately 124,902 river miles
    are impaired due to siltation, 97,147 river miles are impaired due to
    nutrients, 69,391 river miles are impaired due to oxygen-depleting
    substances, 48,573 river miles are impaired due to habitat alterations,
    and 48,573 river miles are impaired due to suspended solids. For lakes,
    ponds, and reservoirs, approximately 3.36 million acres are impaired
    due to nutrients, 1.68 million acres are impaired due to siltation,
    1.34 million acres are impaired due to oxygen-depleting substances, and
    840,000 acres are impaired due to suspended solids. Approximately 311
    shoreline miles of the Great Lakes are impaired due to nutrients and
    311 shoreline miles of the Great Lakes are impaired due to oxygen-
    depleting substances. For estuaries, approximately 6,340 acres are
    impaired due to nutrients, approximately 3,458 acres are impaired due
    to oxygen-depleting substances, and 1,729 acres are impaired due to
    habitat alterations.
        Question. Recent reports indicate that the Corps is about to
    release a final rule establishing an administrative appeals process
    within which to appeal decisions by the Corps. However, the reports
    quote John Studt, Chief of the Corps Headquarters Regulatory Branch, as
    acknowledging that the appeals process will not allow an appeal of the
    Corps determination that one's land is ``wetlands'' subject to the
    Corps jurisdiction. I'm concerned about that because right now I
    understand that in order to challenge assertion of jurisdiction by the
    Corps, the Corps requires a landowner to apply for a permit to use his
    land, and only if the permit is denied can the landowner go to federal
    court to challenge not only the permit denial, but the original
    determination by the Corps that the land is a wetland. I'm also
    concerned that the Corps is ignoring specific directions of the Senate
    Appropriations Committee. The Committee provided funding for an
    administrative appeals process for fiscal year 1998. The report
    accompanying the Energy and Water Appropriations bill for fiscal year
    1999, S. Rep. 105-206, states that the committee supports
    implementation of an administrative appeals process ``including appeals
    related to jurisdictional determinations'' (p. 76). My question is,
    given these specific concerns and directives by the Senate, is the
    Corps going to issue an appeals process that includes appeal of
    determinations that a persons land is wetlands? And if not, why not?
        Answer. Appeals of permit denials and conditions will begin in
    fiscal year 1999. The President's fiscal year 2000 budget request
    includes funding for a full appeals process that includes jurisdiction
    determinations. The appeals process for jurisdiction determinations
    will follow, once the necessary funding is available. We want to
    implement this initiative and urge Congress to provide this funding in
    fiscal year 2000.
                                     ______

                      Questions Submitted by Senator Craig

                   regulatory program--administrative appeals
        Question. What has the Corps done with the monies (both fiscal year
    1998 and fiscal year 1999) that were specifically earmarked, at the
    request of the Corps, for the implementation of the administrative
    appeals process?
        Answer. The Army budgeted for the administrative appeals process in
    fiscal year 1998 and fiscal year 1999 but did not request that the
    funds be earmarked. The Appropriations Committee report language stated
    the intentions of the Committee to have a full appeals process
    implemented. However, the appropriations we received in the fiscal
    years you mention were well below the President's budget requests which
    would have funded the full appeals process without sacrificing services
    to the public. More citizens depend on our responsiveness to their
    permit applications than the number that would use the appeals process.
        The Regulatory Program is a labor-intensive program and, as such,
    requires a 2-3 percent increase in funds each year just to maintain
    staffing levels. Most of the Regulatory funds in these years was
    prudently used to maintain staffing levels of the districts in order to
    continue providing timely, equitable services to the public. In fiscal
    year 1999, we have been able to set aside some funds for the appeals of
    permit denials and conditions which will become effective on August 6,
    1999.
        Question. In fiscal year 1997, the Corps acted on 65,138 Section
    404 permit applications. Out of those, there were only 28 individual
    permit denials. As the Corps has most recently indicated that it plans
    to only implement a partial administrative appeals process for only
    permit denials, the Corps appears prepared to spend about $180,000 per
    permit denial. Meanwhile, property owners who disagree with the Corps
    over their jurisdiction determinations will still have to spend over a
    year in the permitting process before having the ability to challenge
    the decision in court. Please explain your justification for the Corps'
    decision to focus both its regulatory efforts and increased budget on a
    program already subjected to direct judicial review, and how do you
    believe this to be a fair and equitable process?
        Answer. While we have supported the implementation of
    administrative appeals, the problem has been the affordability of a
    full appeals process and its impacts on the other parts of the
    Regulatory Program. Our cost estimate for appeals of permit denials and
    conditions is $1 million per year. The cost to implement a
    jurisdictional appeals process is estimated to be $5 million. To have
    dedicated $5 million from an already austere program for the full
    process would have meant shortages of regulatory personnel in the
    districts. This would have meant cutting back on other services. The
    program impacts a sizable segment of the public through its permit and
    enforcement-resolution programs. While everyone recognizes the
    advantages of jurisdictional appeals, it does not make sense to cut
    basic services in order to spend money on an activity which would
    benefit a much smaller group.
        A wetland delineation does not restrict an applicant from using his
    or her property. He or she simply has to apply for a permit if the
    activity is in a wetland. The Corps' performance goal is to evaluate
    permit actions within 60 days, and the most recent analysis or
    performance data showed that this goal is achieved 95 percent of the
    time. If the permit is disapproved, or approved with certain
    conditions, then the applicant can bring a lawsuit against the Corps to
    challenge the delineation. In addition to 31 permit denials in fiscal
    year 1997, there also were 5,000 permits issued that were subject to
    conditions. These will be subject to the existing appeals process.
        Everyone agrees that the appeals process is less expensive and less
    time consuming than litigation. The Corps' experience has been that
    most applicants are satisfied with a fair hearing in the local Corps
    district office, even if they do not get the result they want. We want
    the permit process to be fair and equitable to our citizens and we do
    not believe that litigation is the best way to resolve most
    differences.
        Question. As indicated in the 1999 Conference Report, the
    implementation of an administrative appeals process for only permit
    denials is unacceptable. Furthermore, the Conference Report language
    directs the Corps to demonstrate its progress in implementing a full
    administrative appeals process when it requests its fiscal year 2000
    budget. Why has the Corps recently again insisted that it will only
    implement a program that addresses permit denials and that it needs
    more money to implement a full program, against the expressed
    instructions of the Congress?
        Answer. The Army's position is to support Committee report language
    as fully and as best as we can, within the resources provided in
    appropriation acts. However, the appropriations we received in recent
    years were well below the President's budget requests. To have
    dedicated $5 million from our already austere program for the full
    process would have meant shortages of regulatory personnel in the
    districts. The public would suffer because, with fewer team members to
    evaluate permit applications, backlogs would grow and private citizens
    and businesspersons would have to wait longer to receive a permit. The
    permit program serves more citizens than would the appeals program so
    we decided that a phased implementation would work best for the program
    and the public. We believe that we would be doing the Nation a
    disservice by drastically curtailing or eliminating the other program
    activities in order to implement fully the administrative appeals
    program.
        We have complied with the Congressional direction in the Committee
    report language as best as we could, consistent with our commitment to
    provide fair and responsive services to the public. The final
    regulation for appeals of permit denials and conditions was published
    in the Federal Register on March 9, 1999, with an effective date of
    August 6, 1999. The process for the appeals of jurisdiction
    determinations is more complex and labor intensive. With the levels of
    funding for the Regulatory Program in recent years, we have not been
    able to start up this part of the appeals process without compromising
    our services to the public.
                                   milo creek
        Question. Milo Creek flows under the communities of Kellogg and
    Wardner, Idaho. During a rain on snow event in May of 1997, the creek
    jumped its banks and burst through the city streets and yards. Raw
    sewage ran down the streets and backed up into one home running through
    its pipes and flowed out of the roof of the home. The situation is even
    more complicated because the area lies within the Bunker Hill Superfund
    site. The water running through the streets contained high levels of
    heavy metals. The blood lead levels obtained for 1998 showed an
    increase in children's levels in the direct area of the Milo Creek
    project. The communities and the State chose Alternative D of the Corps
    Reconnaissance Report Phase of 1995 for reconstruction and Phase I of
    the project has been completed and they are going to bid for Phase II.
    The COE has reviewed and commented on the Phase I and is awaiting bids
    for Phase II. However, the COE has not financially participated in the
    project. The communities are currently short of funds and with the high
    snow pack (150 percent of normal) they are expecting another flooding
    situation. If the project can't be completed this year, the potential
    for additional health and environmental related damages is likely to
    occur.
        As the COE has been committed to the Milo Creek project through
    their studies, can you apply the money that has been held for the Milo
    Creek project and use the money for the Phase II portion of the
    project?
        Answer. There are no Corps funds being held for the Milo Creek
    project. Also, the Corps has no authority to apply funds to continue
    the construction of the State's project. The Corps conducted a
    reconnaissance level study under its Section 205 authority to determine
    if a viable solution existed that would solve the flooding problems.
    While this study was favorable, it was only to recommend more detailed
    feasibility studies. Following the flooding of 1997, local officials
    decided not to continue with the more detailed study but focus on
    addressing the immediate problems. This resulted in implementation of a
    project by the State of Idaho.
        The Corps could continue the project under the Section 205 program
    if a local sponsor is willing to participate in continuing the planning
    and design phases of the project, which could lead to the Corps funding
    the Federal share of construction.
                                 libby dam, mt
        Question. My office has been working with the landowners in
    Boundary County, Idaho. They have been experiencing ongoing
    difficulties with the operation of the Libby Dam in Montana. When the
    dam was built it was to be managed for flood control, power management
    and recreation. Since that time the government has added management for
    the Kootenai River sturgeon and salmon. The down river landowners have
    experienced serious erosion because of water flows coming from the dam.
        The levels of the river are kept higher year long allowing for
    seepage to occur along the river causing additional erosion and crop
    loss. This comes about from sturgeon requiring a higher flow during the
    months of June and July, and salmon requiring faster water during
    August.
        As the requirements for Endangered Species affect the management of
    the river, can you provide relief for the landowners during the rest of
    the year to allow their land to `dry out' prior to the onset of these
    faster flows by adjusting river levels? Can the levels and flows be
    maintained year round to protect agriculture from damages and erosion?
        Answer. We regulate Libby Dam for flood control within our overall
    operational constraints. The only time the land can `dry out' is
    usually the latter part of March and early April. The flood control
    operation of Libby Dam requires releasing water during the fall and
    winter to assure that the reservoir has adequate flood storage space at
    the onset of spring runoff. In years of higher than normal snowpack,
    like 1996, 1997 and 1999, the Kootenai River is generally high from
    November until March. Depending upon how large the snow pack is in a
    given year, April may be the only opportunity to reduce flow in the
    spring.
        Regarding the levels and flows, operation of the Libby project is
    constrained in large part because of the Corps of Engineers' commitment
    to implement actions consistent with the Biological Opinions in place
    under requirements of the Endangered Species Act. Current periods of
    low flow may be from September through November. In a wet winter, flow
    will be high from December through March, when April becomes the only
    opportunity to reduce flow.
                                     ______

                      Questions Submitted by Senator Reid

                 construction, general--continuing authorities
        Question. In your statement, Dr. Westphal, you request $1.24
    billion for the Construction General Program. Is this funding for new
    studies under the Continuing Authorities Program or completion of
    projects already in construction?
        Answer. The $1.24 billion request for Construction, General
    includes $57 million for the Continuing Authorities Program. This
    amount is sufficient to allow a balanced program of study, design and
    construction, including both continuation of projects underway and new
    starts.
        Question. You mention only one new ``survey''. I'm assuming this is
    a reconnaissance study. I understand that there may be a backlog in the
    General Investigation Program, has there been a decrease in requests
    from local agencies and interests for new surveys?
        Answer. The fiscal year 2000 budget request includes $100,000 for
    one new start reconnaissance section 905b analysis. The new start
    surveys are being constrained to allow the backlog of projects
    approaching construction to be reduced. The number of requests for new
    start surveys has not decreased.
                              harbor services fund
        Question. In your statement, Mr. Secretary, you state that you will
    be pursuing Harbor Services Fund legislation separately from WRDA 99.
    When do you propose to send it to Congress?
        Answer. I plan to send the legislative proposal to Congress in
    April.
                              challenge 21 program
        Question. Do you have any projects being considered under the new
    Challenge 21 program anticipated in Water Resources Development Act of
    1999?
        Answer. More than 50 potential sponsors of Challenge 21 projects
    have been identified. However, none has been formally selected yet.
    Regarding WRDA 99, it is not our intent to budget for specific
    Challenge 21 projects, but rather to treat this as a program in which
    projects would be proposed and funded throughout the year.
        Question. Do you have a selection criteria established for projects
    that will
        be considered under this program?
        Answer. Basically, all floodplains are eligible for the Challenge
    21 initiative. Candidate projects must show the potential to both
    reduce flooding and restore riverine ecosystems. Priority will go to
    projects with strong local support and potential to include other
    Federal, non-Federal, and non-profit agencies in implementation of the
    project. More specific selection criteria will be established when
    funds are appropriated.
        Question. You do not mention the Project Cooperation Agreements and
    reimbursement issue in your statement, but I would like to know whether
    you see this as a problem with future financing of projects? Without
    closure in the Congressional committees regarding this issue, should
    negotiations continue on Project cooperation Agreements with
    reimbursement as a component with non- Federal entities?
        Answer. Yes, reimbursements could become a problem in the future if
    the amount continues to grow each year. There is a potential that the
    Corps could become a primarily a grant agency in some districts with
    large reimbursable type projects. We are concerned about the potential
    loss of technical expertise within districts as the number of
    reimbursement type projects increases. We want to work with Congress to
    resolve this problem, but it is the prerogative of Congress to make the
    decision on whether or not to continue to undertake such projects. Our
    current practice is not to begin negotiation of an agreement involving
    non-Federal work or advanced funds that could require possible future
    Federal appropriations until we have coordinated the request within the
    Administration and with the Appropriations Committees.
        Question. In your statement, you say that you have fully
    implemented the Project Management concept and are streamlining the
    planning process to ensure completion of studies within budget and on
    schedule. Is your agency prepared to delegate the responsibility and
    authority to Division/District levels so that steps can be taken to
    fulfill this commitment?
        Answer. We have model feasibility cost sharing agreements, which if
    signed without deviation, require no review at higher level in the
    Corps. If the sponsor requests deviations from the model, the agreement
    does require additional review.
        Improving our project delivery process is an ongoing concern of
    mine. Over the past several years we initiated a number of process
    improvements to reduce the time required to take a project through the
    planning, design, and construction process. We will continue to improve
    and refine our process in the future but there is only so much that can
    be done within the current authorization/appropriation process. A
    recent review of our process by the National Research Council
    determined that `` * * * the Corps project planning procedures are
    generally sound and not excessively lengthy when compared to private
    sector planning studies.'' There are, however, areas where the Congress
    can help us further streamline the process. I am prepared to work with
    you to further expedite and improve our project delivery process.
        Question. In your statement, you mention that changes to the
    Continuing Authorities Program recommended by a process action team
    will be implemented. Currently, sponsors are not required to provide
    cash until the construction phases of a project. How will your changes
    affect small jurisdictions (Nevada) with limited funds for upfront
    contribution?
        Answer. Under the traditional Continuing Authorities Program, after
    the first $100,000, sponsors currently provide 50 percent of the cost
    of the feasibility study at the time of the feasibility study. Under
    the environmental authorities, S.1135 and S.206, the total study cost
    is Federally funded and then cost-shared at the time of construction.
    The current proposal would create a single project development process
    that captures some elements of each existing process. Cost-sharing
    would be initiated during planning on all projects; however, it would
    be at the more favorable construction cost-sharing percentage for all
    authorities. This will create a simpler and more equitable process for
    all sponsors under all authorities. We believe that local sponsors who
    have provided 50 percent of the feasibility cost for S.205 small flood
    control projects in the past would be satisfied with this proposed
    change.
               restructuring of headquarters and division offices
        Question. In your statement, you reference the reorganization of
    Headquarters and Division offices. You mention a staff reduction of 14
    percent from fiscal year 1996 to fiscal year 1999. Why is the General
    Expenses budget request the same as last year?
        Answer. The executive direction and management of the Civil Works
    program, performed by the headquarters and division offices, plays a
    key role in providing oversight and direction to our important civil
    works mission. Staff reductions have permitted us to maintain an
    appropriate level of executive direction and management with a constant
    $148 million budget from fiscal year 1998 to fiscal year 2000. Since
    General Expenses is a labor-intensive account which requires personnel
    cuts to absorb cost growth, this flat budget requires us to absorb
    inflation, pay increases, and extraordinary expenses within the
    operating base. The projected fiscal year 2000 inflation of about 3
    percent plus the 4.4 percent in pay increases translates to
    approximately $5.3 million of cost increases being absorbed.
                           regulatory appeals process
        Question. In your statement, you recognize the struggle regarding
    the Regulatory appeals process. You have requested an increase of $11
    million. How will the increase in funding be used to remedy the
    problems with the appeals process? Will you be adding staff to your
    Regulatory field offices in order to process applications in a timely
    manner?
        Answer. Of the $11 million increase in the President's budget, $3
    million is for labor cost increases and filling vacancies in the
    district offices, and $5 million is for implementation of the appeals
    process for jurisdiction determinations. Even without an appeals
    process, the Corps must maintain staffing levels in the districts to
    evaluate permit applications in a timely manner. This is the purpose of
    the additional $3 million.
        Additional staff will be needed, however, to process administrative
    appeals for jurisdictional determinations. For appeals of permit
    denials and conditions, which is being implemented this year, each
    division office will have an appeals officer. More appeals officers
    will be added, perhaps in the districts, to handle the appeals process
    for jurisdiction determinations. Just as the Corps is committed to
    evaluating permit applications in a timely manner, it plans to do the
    same for appeals.
                         lower las vegas wash wetlands
        Question. In Las Vegas there is an area known as the Lower Las
    Vegas Wash Wetlands. The area feeds directly into Lake Mead and
    therefore is significant to the ecology of the region. There are
    significant water quality issues such as erosion and perchlorate
    contamination in the Wash. Unfortunately, the Corps has budgeted only
    $100,000 for this key environmental project. Could you give me a status
    update on this project?
        Answer. Our final reconnaissance report was completed in June 1998.
    We have been working with the non-Federal sponsor, Clark County
    Department of Parks and Recreation, to develop and finalize the project
    study plan. The sponsor has been trying to identify a funding source
    for its cost sharing of the feasibility study for several months and is
    presently working with the Nevada Water Agency to secure the necessary
    non-Federal funds. Although we have currently scheduled the feasibility
    study to begin in August 1999, there remains a high level of
    uncertainty regarding the source of non-Federal funds.
        Question. Since there is a Lake Mead Water Quality Forum that
    constitutes 21 members of the federal, state and local agencies, the
    meetings of which are periodically attended by the Bureau of
    Reclamation and Corps of Engineers, couldn't this project be a model of
    the National Research Council recommendation regarding watersheds as
    the basic planning unit?
        Answer. Yes, the Lake Mead Water Quality Forum could be a model of
    the National Research Council recommendation regarding watersheds as
    the basic planning unit. The Lower Las Vegas Wash feasibility study
    will focus on habitat restoration opportunities in the watershed.
    Habitat restoration represents a specific component of the water
    quality focus of the Lake Mead Water Quality Forum. Since the Clark
    County Department of Parks and Recreation is a member of the Lake Mead
    Water Quality Forum, there may be information that would be beneficial
    to our study and theirs.
        Question. The Water Quality Forum is moving toward the finalization
    of proposals which they will be presenting my staff. Will the Corps be
    able or willing to coordinate with the Forum as proposals are finalized
    at the local level?
        Answer. Yes, we will review and evaluate the proposals of the Lake
    Mead Water Quality Forum to determine whether or not any of the
    proposals could be pursued under existing Corps authorities.
                                     ______

                      Questions Submitted by Senator Byrd

        Question. Mr. Chairman, the President's fiscal year 2000 budget
    request for the Corps of Engineers of $3.9 billion in new budget
    authority is, generally speaking, much better than his budget request
    for fiscal year 1999, but the request is still below the level enacted
    for fiscal year 1999. While I am heartened that the Corps is receiving
    some support from the Administration for its programs and projects, I
    am concerned about the Corps; ability to carry out its critical
    mission. These are difficult budget times, despite all of the media
    hype about the projected budget surpluses, yet the Corps provides
    crucial services to the nation in the areas of navigation assistance
    flood mitigation, recreation opportunities, and power generation. I
    look forward to working with the Chairman and Ranking Member and other
    members of the Subcommittee to ensure that sufficient funds are made
    available for the Corps to continue its projects and programs.
        In reviewing the specifics of the budget request for the Corps, I
    note that the request proposes a decrease of 27 million in general
    investigations and that this decrease will result in (1) less funds for
    navigation, flood damage prevention and shoreline protection studies,
    (2) reduced support for preconstruction engineering and design, (3)
    lower levels of flood plain management, and (4) a decrease in research
    and development.
        Will these proposed program decreases for general investigations
    have a negative impact on the long-term health of our economy, our
    ability to protect communities from the ravages of floodwaters, or on
    our quality of life?
        Answer. No. I do not believe that the proposed program decreases
    will have a negative impact on the long term health of our economy. We
    will continue to address the flood damage reduction needs of the
    nation's communities. Let me assure you that the Army Civil Works
    mission continues to very much be in the business of addressing,
    evaluating and solving the nation's water resource infrastructure
    problems. We are simply proposing a pause in the new study start
    program for the Corps this year in order to catch our breath and at
    least put a sizeable dent in the number of projects currently in the
    construction pipeline. I hope, if all goes well with the Corps program
    in 2000 as well as with the economy and the budget in general, that we
    can resume a higher new start program in the outyears.
        I also note some major decreases are proposed in the construction
    account for locks and dams, for local protection projects, for beach
    erosion control projects, and for dam safety assurance projects.
        Question. Will these program decreases proposed for construction
    projects have a negative impact in the short term on our economy and on
    flood protection?
        Answer. The proposed fiscal year 2000 construction program
    generally does not fund flood protection projects at their optimum
    schedules and these projects would not be completed as expeditiously as
    possible. In this context, there could be a negative impact on the
    economy of an affected locality if flood protection were not in place
    when a flood occurred.
        Question. Won't the proposed construction decreases have the effect
    of postponing the completion of many projects, delaying the benefits
    that will be realized from their completion?
        Answer. About 66 projects included in the President's budget would
    be affected by the funding levels proposed for the fiscal year 2000
    construction program. These projects would be delayed an average of 5
    months from their optimum schedules. It is not possible to conduct a
    definitive analysis of the delayed benefits because so many assumptions
    about the future are required, and many of these decisions have not yet
    been made. Let it suffice to say there are costs associated with
    forgone benefits.
        Question. Does the Corps of Engineers have construction
    capabilities above the level proposed in the President's budget
    request? What level of construction funding did the Corps include in
    its request to the Office of Management and Budget?
        Answer. Yes, the Corps has construction capabilities that
    individually total about $2 billion. However, these capabilities
    consider each project by itself without reference to the rest of the
    program. The Army initially recommended a fiscal year 2000 program to
    OMB that totaled $1.815 billion. This amount was later reduced to
    $1.725 after enactment of appropriations for fiscal year 1999.
                 environmental projects and aquatic ecosystems
        Question. While most activities of the construction account are
    proposed for decreases relative to the fiscal year 1999 funding level,
    two areas would receive modest increases: environmental projects and
    work involving aquatic ecosystems. While these increases are quite
    small, it seems noteworthy that while most construction activities are
    slated for decreases, these two are proposed for increases. What work
    is slated to be accomplished by the new funds recommended for
    environmental projects and aquatic ecosystems?
        Answer. Although the request for fiscal year 2000 for the Section
    1135 and Section 206 programs is $5.7 million greater than the request
    for fiscal year 1999, it is actually $7.2 million less than was
    appropriated for fiscal year 1999. The fiscal year 2000 request of $13
    million is just $1.2 million more than we expended last year in fiscal
    year 1998. The $13 million will allow us to pursue a balanced program
    of work, including continuation of over 300 projects underway,
    coordination with local sponsors seeking new projects and initiation of
    new projects.
        Question. Does the President's budget request propose to increase
    funding for environmental activities at the expense of navigation,
    flood mitigation and control, and dam safety?
        Answer. For the fiscal year 2000 budget, 28 port development
    projects and activities are funded to meet optimum completion schedules
    in accordance with the proposed Harbor Services User Fee which will
    cover all construction costs. Amounts for 165 flood damage reduction,
    inland waterways, and shore protection projects and activities which
    rely on general tax revenues to finance their construction costs are
    constrained to a level that is about two-thirds of what is needed to
    maintain optimum completion schedules. The completion schedules for
    these projects is similar to the completion schedules prepared for the
    fiscal year 1999 budget. In addition, 9 high priority projects for
    mitigation, ecosystem restoration, and other purposes are funded to
    meet optimum completion schedules.
                                  o&m increase
        Question. What types of needs and costs will be covered by the five
    percent increase for operation and maintenance.
        Answer. While providing for the operation and maintenance of the
    Corps projects at justifiable levels of service in all of the five O&M
    business processes, (navigation, flood damage reduction, hydropower,
    recreation, and environmental stewardship) it better enables us to
    extend the useful life of our aging infrastructure.
        Question. Does the proposed increase cover all of your anticipated
    increases for operations and maintenance?
        Answer. As I mentioned, we can continue to safely operate and
    maintain our projects, however over the years budgetary limitations
    have resulted in a buildup of unfunded maintenance work items. Since
    that buildup has grown to be over $1.6 billion, we cannot conceivably
    cover all of that work in one year. The increase has helped us to
    address some items which had been previously deferred while minimizing
    the number of new items to be added to the backlog.
                          impact of 2000 funding level
        Question. What types of needs and costs will be covered by the ten
    percent increase for the Regulatory Program?
        Answer. The President's budget requests $117 million which is $11
    million more than the fiscal year 1999 appropriation. The funds would
    be used as follows:
        Administrative Appeals Process.--Allows applicants to contest
    regulatory decisions without going to court. In fiscal year 1999, the
    Corps will be implementing appeals of permit denials and conditions.
    The appeals process for jurisdiction determinations would be
    implemented with $5 million in the fiscal year 2000 budget request.
        Maintaining Program Performance.--About $3 million is required to
    cover ordinary manpower cost increases and inflation. This is essential
    to allow filling of vacancies so program performance does not decline.
    At 90,000 permit actions in fiscal year 1998, workload is at an all-
    time high. The fact that there was no funding increase from fiscal year
    1998 to fiscal year 1999 has meant staff vacancies in the districts
    cannot be filled this year.
        Watershed Management Efforts and related area studies.--About $2.5
    million in new funding would allow additional special studies of
    sensitive areas with intensive developmental pressures. Study products
    help predict permit impacts in a more comprehensive manner than is
    possible on a permit-by-permit basis. Individual future projects can
    then be evaluated much more efficiently and expeditiously, and some
    management plans can result in shared regulatory responsibilities with
    state and local governments, reducing duplication and delays.
        Wetland Delineator Certification Program.--The Corps is developing
    a national program for the training and certification of non-federal
    individuals as certified wetlands delineators. Final implementation has
    not occurred because of funding constraints; Start-up costs for full
    implementation in all districts is approximately $500,000.
        Question. Why is this increase needed for the for the Regulatory
    Program?
        Answer. Because the Regulatory Program is a people-intensive
    program, the requested funds will continue the Corps commitment to
    serve the public in a fair and reasonable manner while ensuring the
    protection of the aquatic environment required by laws and regulations.
    In fiscal year 1998, the Corps authorized 90,000 activities in writing.
    With the number of permit activities increasing by at least 5,000 each
    year, the President's budget request will ensure that this level of
    service is maintained.
        The Corps also will continue to pursue important initiatives.
    Regional and nationwide general permits increase cooperation with state
    and local governments and help streamline the regulatory process. The
    Corps will establish an administrative appeals process for jurisdiction
    determinations which, in addition to the appeals of permit denials and
    conditions to be implemented this year, will allow the public to
    challenge regulatory decisions without costly, time-consuming
    litigation.
        Question. Why is this increase needed for the for the Regulatory
    Program?
        Answer. Because the Regulatory Program is a people-intensive
    program, the requested funds will continue the Corps commitment to
    serve the public in a fair and reasonable manner while ensuring the
    protection of the aquatic environment required by laws and regulations.
    In fiscal year 1998, the Corps authorized 90,000 activities in writing.
    With the number of permit activities increasing by at least 5,000 each
    year, the President's budget request will ensure that this level of
    service is maintained. The Corps also will continue to pursue important
    initiatives. Regional and nationwide general permits increase
    cooperation with state and local governments and help streamline the
    regulatory process. The Corps will establish an administrative appeals
    process for jurisdiction determinations which, in addition to the
    appeals of permit denials and conditions to be implemented this year,
    will allow the public to challenge regulatory decisions without costly,
    time-consuming litigation.
                              marmet locks and dam
        Question. Congress provided $6,500,000 last year for land
    acquisition, detailed engineering, and design work associated with a
    major lock replacement program at Marmet Lock and Dam along the Kanawha
    River. The President's fiscal year 2000 budget request for the project
    is $9,800,000. The Marmet Lock and Dam is a major navigational
    structure, responsible for moving millions of tons of cargo to and from
    West Virginia every year. This major lock replacement project will help
    maintain and increase the efficient flow of commerce.
        Last year the Corps estimated that is would need to buy about 250
    properties for this project. How many have been purchased to date, and
    how many do you anticipate having purchased by the close of fiscal year
    2000?
        Answer. We have purchased approximately 35 properties so far, and
    we will have purchased approximately 110 properties by the end of
    fiscal year 2000.
        Question. When do you anticipate that the land acquisition for the
    project will be complete? When do you anticipate that the land
    acquisition will be sufficiently far enough along that you can begin
    construction?
        Answer. The land acquisition will take through fiscal year 2002 to
    complete. We will have completed sufficient land acquisition and design
    by the end of fiscal year 2001 to initiate construction of the lock in
    fiscal year 2002.
        Question. How much money will be needed beyond fiscal year 2000 to
    complete the project? What work will remain to be done?
        Answer. An additional $264,200,000 is needed beyond fiscal year
    2000 for continued engineering and design of the lock and appurtenant
    features, acquisition of the 140 remaining properties, and construction
    of the lock.
        Question. Are there additional Corps capabilities at Marmet for
    fiscal year 2000 above those identified in the President's budget?
        Answer. The Corps has the capability, subject to the qualifying
    language, to use an additional $1,550,000 to advance engineering and
    design and land acquisition. This would accelerate project completion
    by approximately six months.
        Senator Byrd. Gentlemen, I am encouraged that the President's
    budget for fiscal year 2000 includes support for this project for the
    inland navigation system. Marmet has a strong benefit/cost ratio
    because of the substantial value of the coal, chemicals, and other
    products shipped along the Kanawha River and the Ohio system. While the
    budget request indicates an increased level of support by the
    Administration for this project, I would remind the Corps that many
    people are affected by this project--not just those whose lives and
    homes are being disrupted by the construction, but also all of the
    people whose work depends upon the locks, the shipping, and the
    products that go through Marmet. Therefore, it is incumbent upon all of
    us to help move this project forward as efficiently as we can to avoid
    any unnecessary delays.
                       greenbrier basin flood protection
        Question. The Greenbrier Basin of eastern West Virginia is one of
    the prettiest parts of the State and one prone to extensive flooding.
    The Water Resources Development Act of 1996 authorized the Corps to
    implement local protection plans to help mitigate damage from future
    flooding. The fiscal year 1997 Energy and Water Development
    Appropriations Act provided $500,000 for the design and implementation
    of a flood warning system in the Greenbrier basin.
        Has the Corps reached an agreement with the City of Marlinton on a
    local protection plan? Have the details of the plan been worked out and
    agreed to among the participants?
        Answer. The Corps has been working with the City of Marlinton, and
    has generally come to an agreement for a plan of protection. The local
    protection plan includes a levee down the front side of Marlinton that
    borders the Greenbrier River and a secondary levee along the Riverside
    area of town. For the remaining flood protection, two alternatives are
    presently under consideration. One involves the extension of the levee
    upstream along Knapps Creek, the other would be for construction of the
    Knapps Creek diversion channel.
        Question. Has a local sponsor been identified for the non-Federal
    part of the local protection plan? What is the non-Federal cost? What
    is the total cost?
        Answer. The City of Marlinton has expressed an interest in being
    the local sponsor. The total project cost is estimated to be
    approximately $54,700,000. The city qualifies for a reduction in its
    cost share to 14 percent based on ability-to-pay provisions. The non-
    Federal share would be approximately $7,700,000; however, the city may
    need other assistance to provide this amount. The Federal share would
    be approximately $47,000,000; however, in accordance with Section 574
    of the Water Resources Development Act of 1996, the amount authorized
    to be appropriated for the Greenbrier River Basin project is limited to
    $12,000,000.
        Question. What activities are currently being conducted on the
    Marlinton local protection plan?
        Answer. The Corps is finalizing the design, conducting field
    investigations, and evaluating the feasibility of the two alternatives
    in the Knapp Creek area.
        Question. What capabilities does the Corps anticipate for fiscal
    year 2000 for the Marlinton local protection plan?
        Answer. The Corps capability for the Marlinton local protection
    project, an element of the Greenbrier River Basin project, is
    $1,000,000, subject to the qualifying language. If provided, these
    funds would be used for continuing the Marlinton detailed project
    report.
        Question. What is the status of the flood warning system for the
    Greenbrier basin?
        Answer. The system was installed in 1997 and 1998, within the 18
    months specified in the 1997 Energy and Water Development
    Appropriations Act. The system is operational. The Project Cooperation
    Agreement was modified so that an additional stream gage could be
    installed this spring at Renick, West Virginia.
        Question. How much will it cost to maintain the flood warning
    system once it is fully operational?
        Answer. It will cost approximately $32,400 per year to operate the
    rain gages, including the Renick gage. The State of West Virginia is
    the project sponsor.
        Question. What future construction and operational needs are
    required for the flood warning system?
        Answer. Installation of the gage at Renick will complete the flood
    warning system.
        Question. How many stream gages and how many rain gages are
    included in the flood warning system?
        Answer. The system includes 6 stream gages, including the gage at
    Renick, and a number of rain gages operated by the National Weather
    Service.
        Question. What is the relationship between the Corps and the
    National Weather Service with regards to the warning system?
        Answer. The National Weather Service assisted in the installation
    of the computer work stations at the stream gages and operates the rain
    gages. The U.S. Geological Survey also has assisted with installing the
    housing for the stream gages.
                west virginia tug fork flood protection projects
        Question. For fiscal year 1999 Congress provided $11.35 million to
    continue work on flood protection projects in southern West Virginia
    along the Tug Fork and its tributaries as part of the multi-state
    Section 202 project. While the President's request includes $5.4
    million for Levisa and Tug Fork projects for fiscal year 2000, all of
    these funds are slated for other States.
        In fiscal year 1999 for the Section 202 Levisa and Tug Fork project
    area in West Virginia, $4,500,000 was appropriated to initiate the
    McDowell County project and $1,475,000 for the Upper Mingo County
    project that specifically included the Mingo County tributary areas. I
    understand that both project reports have been completed, yet as of
    today, the Corps has yet to execute project agreements for either area.
    What accounts for this substantial delay?
        Answer. For McDowell County there was an unresolved issue over the
    level of design detail in the report necessary for proposed ring
    levees. Subsequent to submittal of the report, there has been
    consideration given to a plan involving Federal participation in the
    consolidation of local schools in lieu of constructing ring levees for
    the schools. This assessment of plan details and examination of
    authorities also has contributed to delays in completion of the report
    review and execution of an agreement. The report is expected to be
    approved in April 1999, and execution of the PCA within 90 days after
    report approval. For the Upper Mingo County tributaries area, it took
    five months to resolve project issues and obtain approval of the
    supplemental report. The supplemental report was approved on March 1,
    1999, and the supplement to the Project Cooperation Agreement is under
    review.
        Question. What activities will remain to be done beyond fiscal year
    1999 in lower Mingo County and what is the cost of the remaining
    effort? Does the Corps have capabilities in lower Mingo County in
    fiscal year 2000?
        Answer. Non-structural flood damage reduction, including measures
    such as elevating structures, demolishing and replacing structures, and
    structure-specific ringwalls, would continue beyond fiscal year 1999 if
    funds were provided. The remaining cost is $7,000,000. The Corps
    capability, subject to the qualifying language, for fiscal year 2000 is
    $1,300,000.
        Question. What activities will remain to be completed beyond fiscal
    year 1999 in upper Mingo County along the Tug Fork and its tributaries
    and what is the cost of the remaining effort? Does the Corps have
    capabilities in upper Mingo County in fiscal year 2000?
        Answer. Non-structural flood damage reduction measures would
    continue beyond fiscal year 1999 if funds were provided. The remaining
    cost is $18,200,000. The Corps capability, subject to the qualifying
    language, for fiscal year 2000 is $600,000.
        Question. What activities will remain to be done beyond fiscal year
    1999 in McDowell County, West Virginia and what is the cost of the
    remaining effort? Does the Corps have capabilities in McDowell County
    in fiscal year 2000?
        Answer. Non-structural flood damage reduction measures would
    continue beyond fiscal year 1999 if funds were provided. The remaining
    cost is $148,800,000. The Corps capability, subject to the qualifying
    language, for fiscal year 2000 is $2,200,000.
        Question. What activities will remain to be completed beyond fiscal
    year 1999 in Wayne County and what is the cost of the remaining effort?
    Does the Corps have capabilities in Wayne County in fiscal year 2000?
        Answer. Non-structural flood damage reduction measures would
    continue beyond fiscal year 1999 if funds were provided. The remaining
    cost is $6,000,000. The Corps capability, subject to the qualifying
    language, for fiscal year 2000 is $300,000.
        Floods have repeatedly devastated many counties in West Virginia,
    including those that are part of the Tug Fork basin. The Section 202
    project provides important protection to communities and livelihoods.
    Each of these project areas has local sponsors to fund the non-Federal
    portion of the project. I look forward to working with the subcommittee
    to make further progress on providing flood protection for the West
    Virginia parts of Section 202.
                              wheeling riverfront
        Question. Wheeling, West Virginia, is in the midst of a major
    preservation and rehabilitation project to protect and enhance its
    cultural and commercial resources in its central business district. I
    understand that the Corps has had discussions in the past with the
    Wheeling National Heritage Area about how joint efforts along the
    Wheeling Riverfront could be arranged and about what capabilities the
    Corps might have in participating in this project. This is an important
    project and I believe the Corps might have some expertise that would be
    useful in this effort.
        What would be the first step toward involving the Corps more
    closely with the revitalization efforts, underway in Wheeling?
        Answer. Since the Wheeling waterfront project is recreational in
    nature, and since recreation projects have historically been assigned a
    low budgetary priority, Corps involvement would not occur unless
    Congress added funds for the project. If Congress did so, the Corps
    could conduct a reconnaissance study to determine what role the Corps
    could play in the future development of the Wheeling Riverfront
    project.
        Question. What resources would be needed by the Corps in order for
    it to actively participate in the Wheeling Riverfront project?
        Answer. The normal cost of a reconnaissance study is $100,000.
        Question. What legislation, if any, would be required to authorize
    the Corps' participation?
        Answer. A Committee study resolution provides the authority for the
    Corps to study opportunities for urban waterfront development along the
    Ohio River. This authority extends to design. The project is on the
    pool of Hannibal Lock and Dam, West Virginia and Ohio. Section 4 of the
    1944 Flood Control Act, as amended, provides the authority for the
    Corps of Engineers to participate in the addition of recreation
    facilities on Corps lands at Corps projects. However, additional
    authorization in law would be required for the Corps to participate in
    recreation development on non-Corps lands.
        Question. What unit of the Corps would have the lead in this
    participation?
        Answer. Wheeling is within the geographic boundaries of the
    Pittsburgh District, which would be the lead District. If necessary,
    resources from other Corps offices could be made available to assist in
    this project.
        Question. What would be the cost-share requirements for the
    project?
        Answer. A reconnaissance study to determine the Federal interest in
    future Corps involvement would be 100 percent Federally financed. The
    feasibility phase, if applicable, would be cost shared 50 percent
    Federal and 50 percent non-Federal under a Feasibility Cost Sharing
    Agreement. Design would be financed 75 percent Federal and 25 percent
    non-Federal under a Design Agreement. Project construction costs would
    be cost shared 50 percent Federal and 50 percent non-Federal. Design
    costs would be folded into project construction costs, and the non-
    Federal sponsor would contribute the other 25 percent of design costs
    in the first year of construction. The non-Federal sponsor for the
    feasibility, design, and construction phases must be a unit of
    government. Funds provided by another Federal agency may be used for
    the non-Federal share if such use is authorized in law.
        Question. What types of capabilities might the Corps be able to
    bring into the Wheeling Riverfront project (including the Ohio River
    front area and the mouth of Wheeling Creek where it enters the Ohio
    River)?
        Answer. The Corps has extensive capabilities in recreation master
    planning, environmental assessment, facilities engineering and design,
    and construction management that could be used in development of this
    project.
                 west virginia statewide flood protection plan
        Question. In 1998, the Corps signed an agreement with the West
    Virginia Soil Conservation Agency to conduct a comprehensive study of
    the chronic flood problems that devastate West Virginia, to be
    conducted on a 50/50 cost share basis.
        How long will the study take to complete?
        Answer. The cost sharing agreement for the second and last phase of
    the study is scheduled for execution in May 1999 and the study is
    scheduled for completion in July 2001.
        Question. What will the study do?
        Answer. The study will develop a comprehensive strategy for
    addressing flooding problems throughout West Virginia, concentrating on
    unmet flood control needs, especially in high-priority areas of the
    state where chronic flooding occurs.
        Question. What will the study provide?
        Answer. The study will provide a statewide flood damage assessment,
    identification of existing flood control shortfalls, assessment of
    existing Federal and state flood protection programs, formulation of
    flood protection and floodplain management program improvements,
    assessment of non-Federal financing capability, identification of
    financing needs for investment in flood protection, development of a
    long-term investment strategy for the state, and a detailed report on a
    statewide flood warning system.
        Question. What has been appropriated by the Federal Government to
    date for this project?
        Answer. Appropriations for the West Virginia Statewide Plan total
    $950,000 through fiscal year 1999.
        Question. What additional Federal resources are needed for this
    project?
        Answer. No additional funds are required to complete the study.
        Question. What level of support (funding and in-kind services) has
    been provided by the non-Federal cooperator?
        Answer. $50,000 was used for a reconnaissance-level investigation
    at Federal expense. The feasibility study cost is $1,800,000 and will
    be cost shared 50 percent Federal and 50 percent non-Federal in two
    phases. For Phase I, the West Virginia Soil Conservation Agency, which
    is the study sponsor, provided $213,600 in cash and $62,000 in in-kind
    services. The cost sharing agreement for Phase II is scheduled for
    execution in May 1999. Details of cash contributions and in-kind
    services for Phase II are being identified by the study sponsor at this
    time.
        Question. What is the current status of the project?
        Answer. Several work tasks identified in the project study plan
    currently are underway. The Corps and the National Resources
    Conservation Service are updating statewide flood damage data and
    information on flood control projects in the state that are either
    completed, under construction, or in various planning stages. The Corps
    and the West Virginia Soil Conservation Agency are arranging the
    initial meeting of the Flood Mitigation Task Force, which is a part of
    the Statewide Plan process, and are developing the schedule for a
    series of workshop meetings to be held across the state to solicit
    citizen and local government input into the planning process. The
    workshop meetings are likely to begin in early May.
                          robert c. byrd locks and dam
        Question. A major project was authorized in 1986 at Gallipolis,
    West Virginia, to improve the lock system of the Robert C. Byrd Locks
    and Dam. This project is making great progress, but I understand that
    several years worth of work remain. The President's budget request for
    fiscal year 2000 includes $7.15 million for this project.
        What is the total cost of the project and how much funding is
    needed beyond fiscal year 1999?
        Answer. The total project cost is $373,000,000. The project's
    balance to complete after fiscal year 1999 is $16,278,000.
        Question. What is the status of the on-site mitigation work?
        Answer. The on-site mitigation construction contract, which was
    awarded in September 1997, is 35 percent complete, with completion
    scheduled for December 2001. This effort consists of construction of a
    50-acre wetland area and fish rearing ponds.
        Question. What plans are there for providing fishing access to the
    Ohio River at the Locks and Dam?
        Answer. Fishing access on the West Virginia bank of the Ohio River
    is complete. A fishing access site at the abutment on the Ohio side of
    the river will be constructed in 2001.
        Question. What has been your relationship with the West Virginia
    Division of Natural Resources on this project?
        Answer. The Corps has established a very good working relationship
    with the West Virginia Division of Natural Resources (WVDNR). They have
    actively participated in the design of the mitigation features for this
    project and they participate in all partnering sessions for the
    mitigation work. The on-site mitigation contract includes a system of
    fish rearing ponds. Upon completion of this contract, the WVDNR will
    assume operation and maintenance of this area as its primary fish
    hatchery in West Virginia.
        Question. What additional capabilities does the Corps have for
    fiscal year 2000 beyond those identified in the President's budget
    request for work on this project? If funding is provided, how much will
    the project completion be accelerated by these additional capabilities?
        Answer. In addition to the fiscal year 2000 budget request of
    $7,150,000, the Corps has additional capability, subject to the
    qualifying language, of $2,150,000, which would advance project
    completion by one year.
                              winfield lock & dam
        Question. The Winfield Lock Replacement project has completed all
    of phase I and most of phase II-A. The new lock chamber at Winfield is
    capable of handling 11 jumbo barges at one time and can speed barge
    traffic through the lock in less than 45 minutes. While much of the
    construction has been completed, work remains on site protection and
    clean-up, onsite environmental mitigation, and post-project efforts
    involving the National Guard. The President's fiscal year 2000 budget
    request includes $1.4 million for this project.
        What is the status of the transfer of two buildings to the National
    Guard?
        Answer. A License Agreement was sent in March 1999 to the West
    Virginia National Guard for signature. This agreement will permit the
    Guard to use the buildings until the final transfer is accomplished
    next year.
        Question. What is the status of the bank erosion work?
        Answer. Bank erosion corrective actions were initiated in January
    1999 and are scheduled to be completed by mid-summer 1999.
        Question. What additional capabilities does the Corps have in
    fiscal year 2000 for the project above those already identified in the
    President's budget request? By what length of time would these
    additional capabilities accelerate the completion of the project?
        Answer. In addition to the fiscal year 2000 budget request of
    $1,400,000, the Corps has additional capability, subject to the
    qualifying language, of $1,800,000 that would advance completion by two
    years.
                           bluestone drift and debris
        Question. Drift and debris periodically accumulate behind Bluestone
    dam. This accumulation of drift and debris has been identified as a
    significant problem. Following a study authorized in the Water
    Resources Development Act of 1992, the Corps identified a preferred
    plan for managing the drift and debris. For fiscal year 1999, $420,000
    was appropriated to finalize the construction design for handling the
    drift and debris and for continued development of a public awareness
    program.
        What benefits will be derived from the completion of the drift and
    debris project?
        Answer. Completion of construction of the multi-level intake
    structure would prevent accumulation of drift and debris during periods
    of high inflow to the project and reduce the accumulation of drift and
    debris pileups on the National Park Service property at Sandstone
    Falls.
        Question. What operational changes will occur as a result of the
    completion of the drift and debris project?
        Answer. Completion of the multi-level intake structure would not
    require any operational changes to the project.
        Question. What group is covering the non-Federal costs of the
    project?
        Answer. The current and prospective drift and debris management
    program associated with the project has four components, namely
    construction of the multi-level intake structure at the project,
    acquisition of debris removal equipment, the public awareness program,
    and cleanup of debris downstream on National Park Service lands. The
    Corps could construct the multi-level intake structure and acquire
    equipment as part of project operation and maintenance at full Federal
    expense. The Corps, the National Park Service, the West Virginia
    Division of Environmental Protection, and other non-Federal interests
    are participating in the public awareness program. The Corps
    participation is part of project operation and maintenance. The
    downstream cleanup currently is financed by the National Park Service
    and the West Virginia Division of Environmental Protection. If non-
    Federal cost sharing in the construction of the intake structure or
    Corps cost sharing in the downstream cleanup were authorized, the West
    Virginia Division of Environmental Protection would be the cost sharing
    sponsor.
        Question. What additional Congressional legislation will be
    required to implement the preferred plan?
        Answer. No authority is required for the Corps to construct the
    multi-level intake structure, acquire equipment, or continue to
    participate in public awareness efforts. Legislation would be required
    for the Corps to participate in the downstream cleanup.
                          bluestone dam safety project
        Question. What risks are currently posed by the Bluestone Dam to
    the communities and environments below the dam?
        Answer. Under current design criteria, the probable maximum flood
    is estimated to overtop the existing dam by 13 feet. Dam failure would
    cause catastrophic flooding along the Greenbrier, New, Gauley, Kanawha,
    and Elk Rivers, including the metropolitan area and heavily
    industrialized capital city of Charleston, West Virginia. This would
    place more than 115,000 persons at risk, with property damages in
    excess of $6,500,000,000.
        Question. What level of flooding would cause the dam to fail
    catastrophically? How likely that such a level of flooding might occur?
    How likely is it that the dam will catastrophically fail in the next 50
    years? In the next 100 years?
        Answer. The dam would be in danger of failing if pool levels
    approaching the top of the existing dam were to occur. This flood
    level, known as the 500 year flood event, has a 0.2 percent chance of
    occurring in any year, a 10 percent chance of occurring at least once
    in the next 50 years, and an 18 percent chance of occurring at least
    once in the next 100 years.
        Question. What operational changes would take place as a result of
    the completion of the dam safety project?
        Answer. Daily operations of the project would not change. For
    catastrophic floods approaching a probable maximum flood level, the six
    hydropower penstocks would be used to provide additional discharge
    capacity. Once activated, the penstocks would remain open until pool
    levels return to normal and the penstock bulkheads could be restored.
    Use of the penstocks does not increase downstream damage; however, the
    time required for pool levels to return to normal could delay the start
    of cleanup efforts by several days.
        Question. What are the benefits that might be associated with
    combining the dam safety project and the drift and debris project?
        Answer. The main benefit attributed to a combined effort would be
    that a single structure could be built for the resident engineer's
    office that would serve both construction efforts. It is possible that
    the two efforts could be constructed under a single contract.
        Question. Could the drift and debris project precede the dam safety
    project? What additional costs and risks might this impose?
        Answer. The drift and debris project could precede the dam safety
    project. However, there are increased risks to life and property
    associated with any delay in initiating the dam safety project.
                             island creek at logan
        Question. The Water Resources Development Act of 1986 authorized a
    non-structural (local protection plan) project combined with some
    channel improvements for Island Creek at Logan. This area experienced
    major flooding in 1957, 1963, 1974, and 1977. The Corps completed
    studies in 1993 and recommended a plan of action that would provide
    significant flooding reductions and have a positive benefit-cost ratio
    of 1.34. $1.5 million in Federal funds have been spent on the project,
    but activity stopped in fiscal year 1994 because the Logan County
    Commission, the local sponsor, was unable to provide the non-Federal
    share of the project implementation costs. Last year, the State of West
    Virginia agreed to provide funds to assist the Logan County Commission
    in sponsoring the project.
        Have any Federal construction funds been spent on this project?
        Answer. No Federal construction funds have been spent to date.
        Question. With the local sponsor now able to provide the non-
    Federal cost share, are more general investigation funds needed for
    completing studies or are only construction funds needed to implement
    the plan of action?
        Answer. $25,000 in General Investigation funds have been
    reprogrammed to review plan formulation and conduct an economic update
    of the project benefits. In fiscal year 2000, the Corps has a
    capability, subject to the qualifying language, of $500,000 in General
    Investigations funding to develop a project management plan and
    complete a General Reevaluation Report. The Corps could complete
    preconstruction engineering and design in fiscal year 2001.
        Question. What can the Corps do to re-initiate this project?
        Answer. The Corps recently reprogrammed $25,000 to review plan
    formulation and conduct an economic update of the project benefits to
    reaffirm the Federal interest in further study and project
    implementation.
                              london lock and dam
        Question. The fiscal year 2000 budget request includes $600,000 to
    initiate construction of the London Lock and Dam rehabilitation
    project. This project would replace the upper guard wall and extend the
    lock chamber. The rehabilitation project is needed to avoid any future
    lockage delays on the Kanawha River at London, where traffic exceeded 8
    million tons in 1995.
        What is the total cost of the project?
        Answer. The total cost of the project is $20,300,000.
        Question. When is it scheduled to be completed?
        Answer. The project is scheduled for completion in September 2004,
    subject to receipt of funding to initiate the project construction in
    fiscal year 2000.
        Question. Is any Congressional action other than appropriations
    required for the project?
        Answer. No additional Congressional action is necessary to proceed
    with the project.
        Question. Does the Corps have additional capabilities for fiscal
    year 2000 that would accelerate the completion of this project were
    funds available?
        Answer. In addition to the fiscal year 2000 budget request of
    $600,000, the Corps has additional capability, subject to the
    qualifying language, of $800,000, which would advance completion by one
    year.
                                lower mud river
        Question. The Lower Mud River project, authorized by Section 580 of
    the 1996 Water Resources Development Act, was originally a Department
    of Agriculture project. Its purpose is to mitigate the repeated
    flooding events that have caused extensive damage to the city of
    Milton, West Virginia.
        What is the status of the limited reevaluation report being
    conducted by the Corps on the earlier Department of Agriculture study?
        Answer. The Corps is preparing to enter into a design agreement
    with the West Virginia Soil Conservation Agency to cost share work on
    the Limited Reevaluation Report. It is anticipated that the agreement
    will be signed in May 1999 and the report will be completed in December
    1999.
        Question. What group is the non-Federal sponsor for the
    reevaluation and what funds have they provided for the reevaluation?
        Answer. The West Virginia Soil Conservation Agency will serve as
    the non-Federal sponsor for the reevaluation report. It will provide
    required cost shared funds at the time of execution of the design
    agreement.
        Question. What capabilities does the Corps have for fiscal year
    2000 to move forward with the Lower Mud River project? What funding
    would be required?
        Answer. In fiscal year 2000, the Corps has the capability, subject
    to the qualifying language, of $1,000,000 to continue preconstruction
    engineering and design under the General Investigations appropriation.
                             cooperative agreements
        Question. I understand that the Corps has developed model
    cooperation agreements with ``cookie cutter'' language intended to
    expedite the review and approval process, yet review and approval still
    takes many months. This type of delay costs valuable time, may
    negatively impact the economy, and could increase risks for communities
    and businesses from flooding and transportation uncertainties. At what
    level within the Corps are project cooperation agreements approved?
        Answer. Project cooperation agreements are approved at the
    Washington level unless there is an approved model agreement for that
    particular type of project. If there is an approved model and the
    district does not deviate from the model, then approval is delegated to
    the division or district commander. Except for the Continuing
    Authorities Program, my office approves all agreements not in
    accordance with an approved model.
        Question. Is it the intention of the Corps to eventually delegate
    approval for all project cooperation agreements to the district level
    or lower?
        Answer. While delegation of approval of Project Cooperation
    Agreements was considered, it is not the intention of the Army to
    delegate the approval of these important agreements, except where model
    agreements are in place and followed. The Army considers these
    agreements to be important policy documents laying out the respective
    responsibilities and commitments of both the project sponsor and the
    Federal Government. Moreover, once signed, such agreements bind the
    Government just as they bind the non-Federal sponsor. We intend to work
    with the Corps to identify and put into practice changes in the
    requirements and review process to improve the efficiency with which
    agreements can be reviewed and approved.
        Question. What is the status of the implementation of the project
    cooperation agreement ``cookie cutter'' language?
        Answer. I strongly encourage the efforts of the Corps to develop as
    many model agreements as possible. The approval of more types of model
    agreements, along with options appropriate to specific situations, will
    help to expedite the negotiation process with the sponsor and minimize
    the number of agreements that must come to the Washington level because
    they are not in accordance with law or Army policy. The Corps has
    developed, and I have approved, the use of over 35 model agreements.
    The Corps is currently working an additional five potential models and
    is in the process of identifying what other models are needed to
    support further delegation of project cooperation agreements to the
    division or district commanders. In addition to the development of
    additional model agreements, opportunities are being investigated to
    simplify and expedite the Washington level approval process.
                                     ______

                     Questions Submitted by Senator Murray

                     columbia river fish mitigation project
        Question. In the Conference Report to the Energy and Water
    Development Appropriations Act for fiscal year 1998 (H. Rept. 105-271),
    the conferees requested the Northwest Power Planning Council, with the
    assistance from the Independent Scientific Advisory Board (ISAB), to
    review the Corps' major fish mitigation capital construction activities
    in the Columbia River Basin. The Power Planning Council divided the
    review into three phases. The first two reports were submitted to the
    Committees in July 1998 and January 1999. The final report is due next
    month.
        Answer. One area reviewed by the ISAB was the Corps' work to
    develop surface bypass/collection facilities at Lower Granite Dam and
    other mainstem projects. The Power Planning Council concurred with the
    ISAB's findings that surface collection continues to show promise and
    should continue to be pursued by the Corps.
        Question. How much of your fiscal year 2000 request is allocated to
    developing and testing surface bypass and surface spill technologies?
    Also please identify which projects are involved in this work, and what
    level of funding is proposed for each.
        Answer. Approximately $35 million is requested for surface bypass
    development and related spill effectiveness and survival evaluations.
    In addition, $5.9 million is requested to continue the `fast track' gas
    abatement efforts which may improve spill conditions for juvenile
    passage. Surface bypass work will be carried out at Lower Granite for
    $8.26 million, at John Day for $5.31 million, at The Dalles for $5.64
    million and at Bonneville for $15.3 million.
        Question. In its first report, the ISAB recommended that the Corps
    pursue surface bypass technologies at John Day Dam instead of extended
    length screens. Please explain how the Corps is implementing this
    recommendation.
        Answer. The Corps is investigating surface bypass at the powerhouse
    through use of existing skeleton bays and funding in fiscal year 2000
    would be used to initiate plans and specifications for construction of
    the surface bypass prototype facility. At the spillway, fiscal year
    2000 work would include testing an overflow weir and initiating a
    Feature Design Memorandum for a raised spillway bays crest, subject to
    preliminary analysis in fiscal year 1999.
        The ISAB has concluded that the subject of adult passage at
    Columbia and Snake River dams has not been adequately dealt with. The
    scientists believe that the Corps' planned activities relating to
    adults are supportable, but probably not sufficient to ensure that
    adult spawning migrations are unimpeded and completed with minimal
    mortality induced passage.
        Question. It is my understanding that only about 9 percent of the
    Corps' fiscal year 2000 budget request is proposed for adult passage
    activities. Do you intend to reexamine this allocation in light of the
    ISAB's findings that more needs to be done for adults?
        Answer. Yes. The ISAB report on adult measures did not identify
    specific passage measures in addition to those underway. However, the
    Corps is presently coordinating with regional interests to determine
    what additional passage improvements should be pursued. Results of this
    coordination may lead to redirection of funds within the budget
    request.
        Question. What additional measures to assist adults will you
    consider?
        Answer. We are looking at both facility improvements and additional
    studies to better understand the critical areas of uncertainty, for
    improved adult fish passage at Corps of Engineers dams. The facility
    improvements include additional backup auxiliary water supply systems,
    automated fishway control systems, replacement/upgrade of diffuser
    gratings and valves, refurbishing/upgrade of fishway entrances and
    weirs, upgrade of fishway staff gauges, and rebuilding fishwater pumps.
    Additional study areas, developed in coordination with regional salmon
    managers, include: relation of adult fallback at dams to specific
    project operations and impacts on fish survival and reproductive
    success; causes of delay in fishways; identification of factors causing
    unaccountable losses of adults; quantification of straying and the
    impact on survival; effects of water quality on migration and survival;
    evaluation of kelt (spawned-out steelhead) passage and survival, and
    improvement of dam count accuracy.
        The ISAB's review has provided useful recommendations on a variety
    of activities including extended length screens, gas abatement
    activities, surface bypass systems, adult passage, and other items.
        Question. How will the Corps ensure that these recommendations are
    given full consideration in the development of future budgets for the
    program?
        Answer. The Corps intends to seek regional recommendations
    regarding how the findings of the ISAB and the Northwest Power Planning
    Council can be implemented in the Columbia River Fish Mitigation
    Project. This is consistent with language in House Report 105-271 which
    states `Upon completion of the review, the Corps of Engineers shall
    seek regional recommendations, as provided by the Bonneville Power
    Administration Fish and Wildlife Budget Memorandum of Agreement dated
    September 16, 1996, on implementing the recommendations contained in
    the review.' The Corps intends to seek the recommendations primarily
    through coordination in existing forums such as the regional System
    Configuration Team. Results of this coordination will be reflected in
    future budget requests for the Columbia River Fish Mitigation Project.
     bonneville and the dalles powerhouse projects replace generating units
        Question. Two construction projects in the Corps' fiscal year 2000
    justification are the rehabilitation of generating units at the
    Bonneville Powerhouse and The Dalles Powerhouse. The original
    completion date, at least for the Bonneville Powerhouse project, was
    2002. It seems unlikely that under the current funding levels that the
    completion date can be met, and the date will more likely be around
    2008 or 2009.
        Is the request of $10,800,000 for fiscal year 2000 for the
    Bonneville Powerhouse enough to maintain the original schedule for
    completion?
        Answer. No, it is not.
        Question. What level of appropriations would be required over the
    next three fiscal years in order to meet the original schedule?
        Answer. For Bonneville, at this point, the original schedule cannot
    be met. Due to requirements of the project biological opinion, units
    can only be completed one at a time, with short duration overlaps.
    Funding at the following levels would advance project completion by 1
    to 2 years: fiscal year 2000 $16.3 million, fiscal year 2001 $11.4
    million, and fiscal year 2002 $10.1 million. For The Dalles, it is
    unlikely the original programmed schedule for completion in fiscal year
    2005 can be regained at this point. Funding levels estimated at $12 to
    $15 million per year beginning in fiscal year 2001 would advance
    project completion by 1 to 2 years.
        Question. If you had greater funding for these projects, what work
    would you prioritize?
        Answer. Work is already prioritized within each project according
    to greatest need and to maximize work efficiency. Greater funding for
    these projects would allow earlier completion of the project by
    accelerating the work.
        Question. What are the implications of not maintaining the original
    schedule in terms of the overall costs of the project, risk of failure
    of the units, and lost efficiency?
        Answer. At Bonneville, not maintaining the original schedule will
    increase somewhat the project cost and risk of failure of the
    generating units, and will delay the expected increase in unit
    efficiency of four to six percent.
        At The Dalles, the original rehabilitation program (Units 1-14)
    included only 9 generator rewinds, since 5 had already been repaired
    under the O&M program. Since initial funding commenced in 1997, two
    additional generators have been rewound, both due to failure. Delays,
    for any reason, increase the risk that additional generating units will
    fail, thus increasing costs for repair, lost power revenues due to
    unscheduled unit outage and reduced plant availability. Loss of an
    estimated 4 percent increase in unit efficiency also results from delay
    of turbine blade replacement. In addition, total project costs increase
    due to out-year inflation as project completion is stretched out.
        Question. What are the impacts in relation to the survival of fish
    during passage?
        Answer. For both Bonneville and The Dalles, past studies indicate
    that the survival of juvenile fish increases with increased turbine
    efficiency. In addition, the shape of the new turbine hub, blades and
    discharge ring have been redesigned at Bonneville to reduce potential
    injury to migrating juveniles that travel through the turbines. If we
    can complete installation earlier, increased juvenile fish survival
    rates should be realized.
                                     ______

                     Questions Submitted by Senator Dorgan

                               devils lake dikes
        Question. The Corps is currently completing the third phase of
    levee protection for the City of Devils Lake, North Dakota. What is the
    status of the current project to raise the Devils Lake levee (to TOL
    1457 feet)?
        Answer. Sir, the earth work and the riprap to top of levee 1452 are
    substantially complete and the levee protection for the city to top of
    levee 1457 will be complete by September 1999. Three of the five
    pumping stations associated with the levee are complete and
    operational. The remaining two are under construction and will be
    operational this summer.
        Question. I am pleased to learn that the major construction work on
    the dike is complete even though the more costly aspects of the
    project, installing pumps and rockwork, remains to be completed.
        Congress has approved a three-phase increase in the dikes in recent
    years. If the Corps had not proceeded with the diking on an emergency
    basis, can you tell the Subcommittee what the consequences would have
    been?
        Answer. Without the levee protecting the City of Devils Lake,
    approximately one-third of the city, including much of the airport,
    would be in the lake. Wave action from the lake would have destroyed
    additional homes and businesses. Portions of Highways 19, 20, and 2
    running through the city would be under water as well. The rest of the
    city would have remained vulnerable to future lake level rises. We are
    also continuing to take emergency actions, when necessary, for other
    communities and Tribal structures threatened by the rising lake levels.
    Even with these efforts, Devils Lake continues to cause about
    $25,000,000 in damages for every additional foot of rise.
        Question. Indeed, we would have had a full-fledged disaster on our
    hands. As it is, we still face enormous problems and that is why we
    need to proceed with a comprehensive flood fighting strategy that
    includes an outlet for Devils Lake.
        Pursuant to the direction of Congress, the Corps is developing a
    report to Congress on the Devils Lake outlet. What is the schedule for
    completing the draft interim report to Congress on the Devils Lake
    outlet?
        Answer. The draft interim report will be completed by the end of
    April 1999. The report will detail various alternatives to manage the
    rising lake.
        Question. May I note for the benefit of the Chairman and my
    colleagues that this report will be made soon and should give us ample
    time for review before we proceed with the mark-up of next year's
    appropriations bill.
        This outlet plan has been a challenging undertaking since it
    involves a chronic flood that has come and stayed for over five years.
    Can the Corps please describe to the Subcommittee some of the promising
    aspects of the plan which may help to solve this perplexing problem of
    chronic flooding?
        Answer. The Corps is looking into alternatives that would bring
    fresh water to the outlet. The fresh water would be captured prior to
    its entering Devils Lake and mixing with the more saline water
    currently in the lake. The fresh water reduces or eliminates impacts to
    downstream water quality. By eliminating the water quality problem, the
    full capacity of the pump station could be used much of the time,
    thereby increasing the effectiveness of the outlet at reducing the lake
    level and avoiding damages. Pumping would still be restricted to stay
    within the capacity of the Sheyenne River. The Corps is also looking at
    staging construction and using trigger elevations to determine when to
    build portions of the outlet plan. This would cause portions of the
    outlet to be built only when they are needed, improving the cost
    effectiveness of the plan.
        Question. Some have suggested that we could use nearby lakes to
    syphon off some water from Devils Lake on an interim basis. Is there a
    plan which would provide some relatively quick means of containing
    rising water?
        Answer. A controlled gravity channel to the Stump Lakes could be
    effective as an interim emergency measure to slow the rise of Devils
    Lake. The Stump Lake plan could be designed and constructed much
    quicker than the outlet to the Sheyenne River. It also helps manage the
    water within the basin, reducing any outside concerns; although there
    are concerns that would have to be addressed, including impacts to a
    Federal wildlife refuge.
        Senator Byrd. I want to thank the Corps for its cooperation with
    the State of North Dakota and the Devils Lake Region and to encourage
    continued efforts to find workable interim and long-term solutions for
    this critical problem.
                               grand forks dikes
        Question. I understand that there may have been some slippage in
    the construction timetable for completing the Grand Forks dikes--from
    2005 to 2007. What is the current schedule for completion of the Grand
    Forks Flood Protection Project?
        Answer. The scheduled completion for the Grand Forks--East Grand
    Forks project has slipped from fiscal year 2006 to fiscal year 2007 due
    to constrained budget ceilings assigned to our overall construction
    program. The completion date based on the constrained budget ceilings
    is December 2006, a twelve month delay. However, note that this project
    was funded at the full capability in the Budget year, fiscal year 2000.
        Question. What is causing the delays in this critical project?
        Answer. The scheduled completion for the Grand Forks--East Grand
    Forks project has slipped from fiscal year 2006 to fiscal year 2007 due
    to constrained budget ceilings in the outyears. Nationwide, many worthy
    water resource projects compete for a limited amount of annual budget
    ceiling. In order to fund as many projects as possible, most projects
    are funded at a less than optimal level, causing schedules to be
    stretched out; this was the case for the Grand Forks--East Grand Forks
    project.
        Question. Do I understand that the capability of the Corps would be
    to complete the project in 2005?
        Answer. If sufficient funding resources are made available, we
    could complete construction of the Grand Forks--East Grand Forks
    project by December 2005, which is fiscal year 2006.
        Question. I understand that the Corps submitted a reprogramming
    request of $1.1 million for Grand Forks flood control for fiscal year
    1999. Can you tell the Subcommittee the status of this request?
        Answer. Yes sir, the additional $1.1 million requested for the
    Grand Forks, North Dakota--East Grand Forks, Minnesota project was
    received on 16 March 1999.

                              subcommittee recess

        Senator Domenici. We will be back in session 9:30, Thursday
    for a hearing with the Department of Energy.
        [Whereupon, at 12 noon, Tuesday, March 9, the subcommittee
    was recessed, to reconvene at 9:30 a.m., Thursday, March 11.]

        ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2000

                                  ----------

                            THURSDAY, MARCH 11, 1999

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 9:39 a.m., in room SD-124, Dirksen
    Senate Office Building, Hon. Pete V. Domenici (chairman)
    presiding.
        Present: Senators Domenici, Cochran, Craig, Reid, and
    Dorgan.

                              DEPARTMENT OF ENERGY

              Atomic Energy Defense and Nonproliferation Programs

    STATEMENT OF DR. VICTOR H. REIS, ASSISTANT SECRETARY,
                OFFICE OF DEFENSE PROGRAMS
    ACCOMPANIED BY:
            ROSE E. GOTTEMOELLER, DIRECTOR, OFFICE OF NONPROLIFERATION AND
                NATIONAL SECURITY
            LAURA S.H. HOLGATE, DIRECTOR, OFFICE OF FISSILE MATERIALS
                DISPOSITION

                               OPENING STATEMENT

        Senator Domenici. First let me, without elaborating, just
    apologize for being late. It was unavoidable on my part, and I
    am sorry. Senator Reid, you had to waste time waiting for me.
        Senator Reid. I had a chance to read my newspaper. I am
    doing fine.
        Senator Domenici. Thank you for coming. This morning, the
    subcommittee will consider the fiscal year 2000 budget request
    for the Department of Energy's defense, nonproliferation, and
    materials disposition programs. Combined, these programs
    account for $5.5 billion of the $18.3 billion requested for the
    Department and are the core of DOE's national security
    function.
        That is a very slight decrease from the current level,
    because of the $200 million provided in 1999 to implement a
    plutonium disposition accord with Russia.
        These programs together are the backbone of our strategic
    nuclear deterrent. On the one hand, we do see the threat to our
    Nation posed by others' weapons of mass destruction, and on the
    other hand maintaining our deterrence against the threat that
    remains. We are considering the programs together because they
    are interrelated. If, for example, in the coming decade when we
    make rapid progress with disposition of plutonium and uranium
    in Russia and our ability to verify our potential adversary's
    stockpile levels we may be able to reduce our nuclear stockpile
    substantially. Conversely, a lack of progress in these areas
    would prevent us from pursuing stockpile reductions.
        We will begin today with Dr. Reis to review the request for
    the Defense Programs, then go to Ms. Gottemoeller, who is
    currently the Director of the Office of Nonproliferation--and
    we are very proud to have you there. She has been nominated to
    this position, and I hope she will be there soon in an official
    capacity--and then we will finish with Ms. Holgate, Director of
    the Office of Fissile Materials Disposition, and we are glad to
    have you also.
        Let me first place a few accolades in the record with
    reference to you, Dr. Reis. Frankly, it has been something very
    solid and beneficial to our nuclear deterrent that you head
    this part of the Department of Energy. I commend and
    congratulate you for the diligent efforts that you have made
    with reference to stockpile stewardship, a new kind of
    stewardship in an era of transition, and it looks like from the
    science standpoint it is working quite well. There is a great
    enthusiasm in the nuclear laboratories for this kind of
    science, which is taking place, since underground nuclear tests
    have been banned in the United States.
        Senator Reid.

                        STATEMENT OF SENATOR HARRY REID

        Senator Reid. Senator Domenici, I appreciate you mentioning
    Dr. Reis. I was going to say a few words about him. I think
    that the American public does not know what public servants do.
    The work that is done by these three individuals, of which Dr.
    Reis is the one that I know certainly the best, having worked
    with him for these many years, makes our civilization such as
    it is.
        The difference between our having a safe, reliable nuclear
    stockpile or not having one is work that we do on this
    subcommittee, and we rely on you for results. I personally
    appreciate all the time and effort and I am glad that you have
    chosen, with your great academic background and your experience
    in the private sector, to stay in public service, because as I
    said, the American public does not realize the importance of
    your job, but Senator Domenici and I do, our staffs, and we can
    say no more than that.
        Mr. Chairman, the stockpile stewardship and management
    program is being adopted by a policy which the nuclear arsenal
    would be maintained. There were numerous discussions by many in
    the administration and here in Congress regarding the minimum
    amount needed, and I am pleased to see the budget request is at
    that level which we have talked about for a number of years,
    $4.5 billion.
        Now there have been questions about what the needs of the
    program are. We are going to talk about that today, the
    National Ignition Facility, Dual Access Radiographic
    Hydrodynamic Test Facility, and others that are essential to
    the verification, and safety and reliability of the nuclear
    arsenal.
        But as I see it, there are two convincing arguments
    applying to the rationale for these investments and others.
    Science must be comprehensive to keep the verification
    credible. The laboratories consisting of experts to coordinate
    with the Department have to come together on these projects.
        Now, the question is, what is the future of both the
    science and the credibility and the verification and
    reliability? At this point, from our perspective the question
    for the future rests on whether the labs and the tests at the
    Nevada Test Site will be functioning as active partners in the
    validation of the science of the Stockpile Stewardship program.
        What we saw in the President's budget did not make me
    happy, but I have recently been given information that
    indicates a serious effort to better integrate the Nevada Test
    Site into the stockpile stewardship and management program, and
    so that is one of the things that we will be watching.
        I note the Chiles Commission has reported that of all the
    centers necessary to maintain confidence without testing, the
    Nevada Test Site has the highest average age of personnel.
    Consequently, either by retirement or death, expertise is
    leaving the Nevada Test Site at an extremely rapid rate.
        So Dr. Reis, I recommend that you repeat the success at the
    National Labs at the Test Site with the implementation of a
    similar program that will attract and maintain highly motivated
    and skilled personnel who could effectively turn their energies
    to the resumption of testing or whatever else is necessary to
    maintain the safety and reliability of our arsenal.
        The magnet that attracts an enduring workforce, without
    which the test ban treaty becomes somewhat meaningless as far
    as I am concerned, is a new technically challenging program
    that has a front line role in the safety and reliability of the
    arsenal.
        So I look forward, as I indicated, to working with you and
    this subcommittee will look forward to getting our bill to the
    floor as rapidly as possible.
        Thank you, Mr. Chairman.

                        statement of dr. victor h. reis

        Senator Domenici. Thank you, Senator Reid.
        Dr. Reis, you may proceed.
        Dr. Reis. Thank you, and thank you, Senator Domenici and
    Senator Reid for your kind remarks about my service. One of the
    gratifying parts of that, of course, is working with people
    like yourselves and your staffs, and that makes it all
    worthwhile.
        Senator Domenici. Thank you.
        Dr. Reis. I have a relatively short oral statement, and
    with your permission I will submit my full statement for the
    record.
        Senator Domenici. It will be incorporated.

                  meeting the stockpile stewardship challenge

        Dr. Reis. Mr. Chairman, Senator Reid, the challenge of
    stockpile stewardship is to maintain the safety, reliability,
    and performance of the current U.S. nuclear weapons
    indefinitely without underground nuclear explosive tests. This
    is indeed a major challenge.
        We are asked to maintain forever an incredibly complex
    device no larger than a desk filled with exotic radioactive
    materials that must create, albeit it briefly, temperatures and
    pressures only seen in nature at the center of stars, do it
    without integrating nuclear tests and without any reduction in
    extraordinarily high standards of safety and reliability and,
    while we are at it, downsize the industrial complex that
    supports this enterprise by a factor of two, and start up
    critical new manufacturing processes.
        We must do this with an industrial system that was
    structured to turn over new designs every 15 years and for
    which nuclear explosive testing was the major tool for
    demonstrating success. We must meet this challenge, restructure
    the complex, and do most of it within the next 5 to 10 years,
    while the current weapons are still within the design life and
    the designers, production and test folks are still active.
        Mr. Chairman, it has been over 10 years since new weapons
    production stopped and over 6 years since the last underground
    nuclear test, and I would claim we are meeting the challenge.
    We have certified the stockpile as safe and reliable 3 years
    running. The major elements of the program are in place, and
    the budgets are projected to be stable in the outyears. While
    there is still much to do, it is fair to say that the road
    ahead is reasonably well-mapped and what remains is to but
    integrate the pieces and to stay the course.
        In short, I believe that all of the many external reviews
    have concurred that Stockpile Stewardship is a successful
    program. Why do I say that? First of all, there is a compelling
    national mission. Despite the end of the Cold War, nuclear
    weapons play a leading role in the Nation's policy of strategic
    deterrence.
        Strategic deterrence is the bedrock of all of our national
    security efforts. At the same time, the maintenance of a safe,
    secure, and reliable nuclear force underpins our arms control
    efforts. It is as described in the Presidential Commission for
    Ratification of the Comprehensive Test Ban Treaty of ``supreme
    national interest.'' That goal acts as the one and only beacon
    for the Defense Programs and the weapons complex.

                       lab missions flow from stewardship

        Stewardship provides an enormous technical and scientific
    challenge to the DOE's nuclear weapons laboratories, Los
    Alamos, Livermore, Sandia National Laboratories, which are
    designed to respond to big national technical challenges. They
    work best in such an environment as, indeed, do the folks at
    the Nevada Test Site.
        In a few short years, Stockpile Stewardship has become what
    is probably the world's largest single-purpose scientific
    program. Our industrial partners have built by far the world's
    largest computers and those computers are solving real problems
    throughout the complex.
        Subcritical experiments, hydro testing, laser pulse power,
    and a variety of other experimental facilities are helping to
    validate codes and bring the necessary understanding to provide
    confidence in the stockpile now and in the future. I think it
    is fair to say that the labs are working together with the
    other parts of the nuclear weapons complex, industry, and
    academia better than ever. Other lab missions flow from
    stewardship, not compete with it.

                   production complex response to stewardship

        Stockpile stewardship has likewise changed the rest of the
    complex. With the end of the Cold War, there is no new
    requirement for nuclear weapons production, though there
    remains a requirement to return to production, if so ordered.
        The most obvious part of this change has been the
    downsizing of the physical plant, the ending of production at
    Rocky Flats, Pinellas, and Mound, and the shifting of
    responsibilities, equipment, and people to other parts of the
    complex.
        As the stewardship requirements have become better
    understood, the production complex--Oak Ridge Y-12, Kansas
    City, Pantex and Savannah River have--has fully responsive to
    the stewardship mission.
        This new production activity is driven by recognizing that
    if the stockpile is to remain viable forever, and that is the
    mission, then every part of every weapon must sooner or later
    be replaced and certified. This means that every part must be
    thought of as a limited life component, and there is a premium
    for knowing when a part must be replaced, and there is a
    premium for developing and certifying new, efficient, safe, and
    environmentally friendly production processes.
        All of this is embedded in the Stockpile Life Extension
    Program, SLEP. The first W87 life extension unit will be
    delivered to the Air Force this May. SLEP will drive production
    in the complex no less than certification, but it must be part
    of an integrated whole. That integrated whole must fit within a
    relatively fixed budget. That is why we are continuing to look
    hard at consolidating the production plant management into a
    single contract.

                               tritium production

        The last programmatic element I will mention is tritium,
    the ultimate limited life component. When I came to DOE some 5
    years ago, the new source for tritium was a headline item. What
    would the new source be and where would it be located?
        Last December, Secretary Richardson announced that we will
    buy irradiation services from the Tennessee Valley Authority
    [TVA], and the accelerator production of tritium will be a
    back-up. Negotiations with TVA based on the Economy Act are
    essentially complete.
        Mr. Chairman, this is the fifth defense program's budget
    that has revolved around Stockpile Stewardship. We have a clear
    goal. We have the people and elements of the program in place.
    We have demonstrated success across a wide variety of
    stewardship tasks. We have a budgetary commitment. The task is
    now to complete the integration of the Defense Program complex
    and to stay the course.

                               prepared statement

        With your continued support, we will continue to meet the
    challenge of maintaining the nuclear weapons stockpile, a
    supreme national interest.
        Thank you very much.
        [The statement follows:]

                      Prepared Statement of Victor H. Reis

        Mr. Chairman and distinguished members of the Committee, thank you
    for the opportunity to testify on the Department of Energy's fiscal
    year 2000 Defense Programs budget request of approximately $4.5 billion
    for the Stockpile Stewardship Program. This budget continues support
    for critical initiatives begun during the past five years that are
    creating and using the new tools and technologies needed for science
    based stewardship. These tools and technologies are necessary as we
    seek to maintain a high level of confidence in the safety and
    reliability of the U.S. nuclear weapons stockpile without nuclear
    testing.
        It has been nearly 10 years since we have manufactured a new
    nuclear weapon and over six years since the last underground nuclear
    test. Our confidence in the safety and reliability of the current
    stockpile remains high. The third annual certification of the nuclear
    weapons stockpile was transmitted to the President by the Secretaries
    of Energy and Defense on December 22, 1998. It states that the
    stockpile is safe and reliable and that there is no need to conduct an
    underground nuclear test at this time.
        The Stockpile Stewardship Program faces formidable challenges:
    continue to maintain an aging stockpile; restructure and modernize the
    weapons complex; and, retain the capability to resume nuclear testing
    and meet production requirements appropriate to future national
    security needs. The Department is meeting these challenges and is
    confident of its abilities to maintain the stockpile without testing.
        We have laid out a plan--weapon by weapon, part by part, that
    addresses the tasks required to maintain the stockpile over the next
    ten years, and beyond. We have support on this program from the
    Department of Defense, and the Administration has committed to funding
    this program and all its parts. And, we have a back up. The President,
    as one of the safeguards under which this nation would enter into the
    Comprehensive Test Ban Treaty (CTBT) requires us to maintain the Nevada
    Test Site in a state of readiness should there ever be circumstances in
    which we would return to testing. The successful subcritical and other
    experiments conducted there bear evidence that the Nevada Test Site
    remains a ``can do'' operation. There is a joint DOD/DOE review of the
    entire test readiness program for the 2001 budget process.
        Another Presidential safeguard under the CTBT requires us to
    maintain the vitality of the nuclear weapons laboratories--Los Alamos
    (LANL), Lawrence Livermore (LLNL) and Sandia. History tells us that
    great laboratories need great missions like the Manhattan and Apollo
    projects. The enthusiasm and vigor with which our laboratories are
    embracing the Stockpile Stewardship Program bear witness that it too is
    a great mission. The program is attracting the kinds of people drawn to
    the challenge of solving tough issues of national importance.
        Although we continue to plan and refine the Stockpile Stewardship
    Program, it is already working. We have modified the B61 bomb and have
    seen it enter the stockpile to replace the aged B53 bomb. We are
    constructing new experimental facilities and tools--the National
    Ignition Facility (NIF), the Dual-Axis Radiographic Hydrodynamic Test
    Facility (DARHT), and Atlas--and our computation program has developed
    the world's fastest supercomputers. By using stewardship tools, we have
    solved some problems that in the past would have most likely required
    nuclear testing. We have done literally hundreds of experiments with
    existing facilities that increase our understanding of nuclear weapons.
    We have safely dismantled over eleven thousand nuclear weapons since
    1991, and have produced numerous parts, on time, while continuing to
    downsize the production complex.
                 stockpile stewardship interagency coordination
        A key element of the Stockpile Stewardship Program's continued
    success is an effective corporate level strategic planning process. I
    am pleased to advise you that we are on schedule to transmit the fiscal
    year 2000 Stockpile Stewardship Plan (SSP), also called ``The Green
    Book'' to the Congress by mid-March. In the development of the SSP, we
    rely heavily on the Department of Defense, the National Security
    Council staff, the Office of Science and Technology Policy, the OMB,
    and other senior policy officials in the ``nuclear community'' to help
    ensure that we are on the right track. The feedback we have received on
    this year's Plan is very favorable. In fact, I was recently informed in
    a letter from the Commander in Chief of the U.S. Strategic Command,
    Admiral Richard Mies, that this Plan reflects a strong commitment by
    DOE to solicit and address the concerns of the nuclear weapons
    community.
        During 1998, the Nuclear Weapons Council (NWC) formed joint DOE/DOD
    teams to review four major areas of the Stockpile Stewardship Program:
    tritium, the Accelerated Strategic Computing Initiative (ASCI), the
    National Ignition Facility (NIF), and pit production. The Nuclear
    Weapons Council concluded that these joint DOE/DOD team efforts were
    worthwhile, generating alternative options and validating DOD
    requirements and DOE plans. The NWC found that tritium, NIF and ASCI
    programs were on-track. The NIF program integration was identified as a
    potential concern by the NWC which we are addressing now. The NWC
    further examined the management and oversight cost controls of ASCI
    software development in more detail and found that the proper project
    cost and schedule controls are in place. After reviewing the DOE pit
    production plan and alternatives for larger and smaller production
    capacities developed by the joint DOE/DOD team, the NWC decided that
    the current DOE plan is a prudent approach. The NWC approved DOE's pit
    manufacturing strategy and will monitor the development of long-term
    plans. This strategy for pit manufacturing will be detailed in our
    response to the fiscal year 1999 National Defense Authorization Act and
    submitted to Congress shortly.
        To better retain U.S. nuclear capabilities, we have been working
    closely with the Commission on Maintaining U.S. Nuclear Weapons
    Expertise, better known as the Chiles Commission. As you know, Congress
    tasked the Commission with developing a plan for recruiting and
    retaining scientific, engineering, and technical personnel that the
    Commission deems are needed, across the nuclear weapons complex over
    the long term, to maintain a safe and reliable nuclear weapons
    stockpile without nuclear testing.
                      how stockpile stewardship is working
        For the benefit of new Committee members, I will briefly summarize
    the Stockpile Stewardship process and the challenges it now faces
    before I go into a more detailed discussion of program elements. Each
    year representative samples of each type of weapon are returned to
    Pantex from the active forces and are disassembled, examined, tested,
    and analyzed for defects, much as you would go for an annual physical
    or take your car into your local automobile mechanic. If any defects
    are found, their effect on reliability and safety is assessed. If that
    effect is deemed significant, the defective part is remanufactured and
    replacedand a nuclear weapon has about as many parts as a modern
    automobile. Like the battery or spark plugs in your car, some parts,
    for example, neutron generators and gas reservoirs, require replacement
    at regular intervals. Other parts of a nuclear weapon are made from
    radioactive materials which decay such as plutonium, enriched uranium
    and tritium; and as they decay, may change both their own properties
    and the properties of other materials within the weapon.
        Remanufacturing replacement parts sounds simple, but subsequent to
    the time that many of the current weapons in the stockpile were
    originally manufactured, some of our production plants have been closed
    and manufacturing processes, techniques and standards have changed.
    General Motors does not build cars the same way it did 40 years ago.
    Everyone is more health and safety conscious and more concerned about
    waste. Today, replacement parts require even tighter production
    controls than the extraordinarily rigid standards under which the
    original parts were designed and manufactured. A nuclear weapon, less
    than the size of a small desk, has enough explosive power to completely
    destroy a modern city, and yet it must be able to survive extraordinary
    accidents with less than a one-in-a-million chance of exploding. New
    industrial materials and new manufacturing processes make it hard to
    get exact replacement parts for an old car or appliance. Yet, we must
    produce replacements with modern material and processes that will still
    maintain weapons safety and reliability.
        As our stockpile weapons age we expect more parts to become
    defective--just as with our automobiles. Because new warheads have not
    been produced since 1989, we cannot replace old weapons with new ones.
    In addition, our weapons designers with nuclear testing experience are
    also aging. In about ten years, most of them will have retired. This
    means that as our newest system, the W88, reaches the end of its
    original design life in 2014, and we may no longer have anyone with the
    necessary job experience to perform underground testing of nuclear
    weapons. Similarly, the engineers and technicians who originally
    produced even this newest weapon may also be gone. It is this time
    factor that is critical to the success of the Stockpile Stewardship
    Program.
        Since we cannot do a complete underground test of a nuclear
    explosion, we can divide the explosion sequence into each of its parts,
    then test and analyze each of these separately, much as you would test
    the ignition system, the cooling system, and the brakes on your car. We
    plan to put all the data together into a computer and develop
    simulations to see if the resulting performance is within
    specification. Each part of the simulation must predict the results of
    each of the separate tests, and where they exist, the results must be
    consistent with data from previous underground nuclear tests. We have
    already begun this process.
                   stockpile life extension and surveillance
        We are working closely with the DOD to finalize detailed plans to
    extend the lifetime of each weapon system in the stockpile. The
    Stockpile Life Extension Program (SLEP) is DOE's planning framework for
    a proactive management of system maintenance activities. Under SLEP,
    options are developed to address potential refurbishment actions. These
    options address correcting known problems, preventing foreseeable
    problems, and improving safety and use control. These life extension
    options allow the Department and DOD to anticipate and plan for future
    resource requirements such as workforce, skill mix, equipment, and
    facilities.
        These requirements provide the framework for stockpile
    refurbishment workload and stockpile research and development
    activities at our laboratories and provide guidance for our production
    plants in the design and certification of replacement components,
    validation of new materials, and development and certification of new
    manufacturing processes. The cycle is continuous and is closely
    integrated. Data and information from our surveillance programs and
    from the hundreds of experiments and simulations being performed to
    help identify which parts of a weapon are aging gracefully and which
    parts present current and potential future problems.
        Stockpile surveillance has been a major element of the U.S. nuclear
    weapons program ever since the first weapons were put into service.
    Approximately 100 stockpile weapons are thoroughly examined each year.
    The results provide data not only for assessing the current safety and
    reliability of the stockpile, but also for developing predictive models
    and age-focused diagnostics required to anticipate weapons
    refurbishment requirements.
        The technologies and methods, as well as a fundamental
    understanding of materials properties and weapons science, to
    significantly improve detection and predictive capabilities are being
    developed in the Enhanced Surveillance Program (ESP). An aging
    mechanism in a stockpile high explosive was identified through the ESP,
    ultimately concluding that the changes actually improved the stability
    of the explosive. This assessment is permitting the reuse of the high
    explosive during the W87 life extension program, thus avoiding
    significant costs. We have also embarked on a novel strategy to
    accelerate the aging process in plutonium. The capability to predict
    the lifetime of components made from plutonium will permit us to more
    accurately identify when pit replacements are needed and when facility
    investments must be made in order to support pit replacement.
        Dual revalidation is designed to provide a baseline assessment of
    the condition of weapons in our aging stockpile. Two teams, one from
    the laboratory that originally designed and developed a weapon and the
    second from the other weapons laboratory, are performing in-depth
    evaluations of the weapon's ability to meet revalidated military
    requirements. The W76 is the first weapon to be reviewed. Each team has
    performed at least one system hydrotest on the W76, and they have
    collaborated on a Shipboard Vibration Test. The review of the W76 will
    be completed in December 1999. The dual revalidation peer review
    program not only baselines the weapon system, but also provides an
    excellent opportunity for experienced designers to pass their skills on
    to the next generation of scientists and engineers.
                           manufacturing capabilities
        Manufacturing continues to play a critical role in the Stockpile
    Stewardship Program. During fiscal year 1998, almost 1,000 Limited Life
    Components (LLCs) were produced. Plans call for the production of over
    1,300 LLCs in fiscal year 1999. These product deliveries signal the
    successful transfer of production activities from plants which have
    been closed. The weapons complex is also performing major refurbishment
    actions on several weapon types, including the B83, B61, and the W87.
    In December 1998, the Y-12 plant at Oak Ridge completed and shipped to
    Pantex the first refurbished component for the life extension program
    of the W87 under our Stockpile Life Extension Program. Earlier this
    month, the first deliveries of electronic and mechanical parts for the
    W87 life extension were shipped to Pantex from the Kansas City plant.
    The first W87 life extension unit will be assembled at Pantex by the
    end of this month with the first group of units due for delivery to the
    Air Force in May. This is considered a major milestone in meeting a DOE
    commitment made to the Air Force.
        The Advanced Manufacturing Design and Production Technologies
    Initiative (ADAPT) is providing the manufacturing complex with advanced
    capabilities for: designing, developing, and certifying components and
    systems; and for producing, assembling, and delivering the components
    and systems products. ADAPT is radically changing how DOE supports the
    nuclear weapons stockpile by infusing new product and process
    technologies, and by adopting state-of-the-art business and engineering
    practices. Our production complex must take advantage of modern
    manufacturing techniques. As an example, a secure communications and
    data network was established among the production plants and
    laboratories which is facilitating rapid interchange of design and
    manufacturing information related to the W87 life extension program. In
    the future, this will serve as the backbone of a modern simulation
    product realization environment. The network is already reducing the
    time needed to produce classified parts, in some instances up to 90
    percent.
        We remain committed to maintaining a robust and world-class
    microelectronics capability at Sandia National Laboratories. This
    effort will allow us to both develop and exploit emerging technologies
    that show great promise for miniaturizing weapon components and
    improving their reliability and for maintaining a critical capability
    in radiation- hardened electronics needed to address the threat
    environments of the future.
        Toward that end, in December 1998, the Department of Energy and
    Intel Corp. announced that Intel Corp. will provide a no-fee license
    for its Pentium processor design to Sandia National Laboratories for
    the development of custom-made radiation-hardened microprocessors for
    use in United States satellite, space vehicles, and defense systems.
    The agreement will save U.S. taxpayers hundreds of millions of dollars
    in microprocessor design costs and provide the federal government with
    a ten-fold increase in processing power over the highest performing
    existing technology. Radiation hardening ``immunizes'' systems and
    applications from ionizing radiation, such as cosmic rays, which affect
    the reliability of conventional electronics. Prototypes of the custom
    chips will be fabricated and tested at Sandia's Microelectronics
    Development Laboratory. While our production workload is certainly far
    smaller than in the past, the demands on our manufacturing processes
    have actually increased. Let me explain what I mean. We now know how
    critical baseline data is to stockpile certification in the absence of
    underground testing. Understanding how parts change over time involves
    comparing old and new parts. In the past, our production facilities
    built components with a primary focus on staying within design and
    process specifications. However, we have learned that seemingly
    insignificant variations in products or processes at the time of
    manufacture can often be the key to component lifetime and hence to
    weapon performance.
        Thus, we have significantly expanded the amount and type of
    baseline data, critical to modeling, collected during production. We
    now record much more than just the product specifications. We collect
    information on the physical and chemical properties of individual parts
    as well as the constituent raw materials. New parts receive significant
    analysis using new technologies and characterization tools covering the
    full scale from the microscopic to macroscopic level. Processes are
    also being re-instrumented to capture key parameters during production.
    All information is collected in readily accessible databases. The
    future of certification relies, in part, on our ability to accurately
    record the condition of parts as they were built. These investments in
    baselining tools and technologies will continue across the complex with
    future life extension activities.
        We are continuing to right-size and modernize our production
    complex for the 21st Century. The Stockpile Management Restructuring
    Initiative (SMRI) is the first step and includes the tritium facilities
    at the Savannah River Site; uranium machining, recycling and storage
    facilities at the Oak Ridge Y-12 Plant; assembly and high explosive
    fabrication facilities at the Pantex Plant; and non-nuclear production
    facilities for electronic, electro-optical devices, plastic and
    machined parts at the Kansas City Plant.
        A pit production capability is being reestablished at the Los
    Alamos National Laboratory, a capability the DOE has not had since the
    closure of the Rocky Flats Plant in 1989. A W88 first development unit
    pit was successfully produced last year and by 2001, the first pit for
    stockpile use will be produced. By 2007, LANL will have a limited
    capability to manufacture replacement pits for the units destroyed
    during surveillance activities.
        The final phase of a five year process to resume enriched uranium
    operations at the Oak Ridge Y-12 Plant will be completed in fiscal year
    1999. The Kansas City Plant has now been qualified for the production
    of tritium gas reservoirs for the W76, W78 and W80 warheads and Sandia
    National Laboratories will soon have a new production facility on-line
    for neutron generators and will deliver almost 300 units in fiscal year
    2000.
        In November 1998, the Heartland supercomputer, one of the largest
    and most powerful computer systems operating in a North American
    manufacturing facility was installed at the Kansas City Plant. This
    system is quickly becoming a key asset in solving production problems
    by simulating production processes with some of the same software that
    is used in engineering and physics simulation on weapon systems and
    which would previously have required very expensive prototypes. For
    example, the Heartland supercomputer has been used to evaluate new
    forge weld designs on such products as the W87 reservoir transfer tube,
    to determine process parameters for filling electronic systems with
    foam for structural integrity, and to evaluate soldering techniques in
    the radar systems for the B83 and B61.
        In addition, over 1,000 nuclear warheads were safely dismantled at
    the Pantex Plant in fiscal year 1998, approximately 275 dismantlements
    will be completed in fiscal year 1999, and 375 dismantlements are
    planned for fiscal year 2000. The decrease in quantity after fiscal
    year 1998 does not reflect a decrease in workload because the systems
    remaining to be dismantled involve more complicated procedures and
    therefore, require additional time and resources. Dismantlements
    resulting from the nation's response to START I, however, will
    essentially be completed by fiscal year 2001.
        In December 1998, Secretary Richardson announced that a review of
    the management structure throughout the DOE would be conducted. Until
    this review is completed, no decision will be made on the Department's
    proposal to consolidate contracts at our defense weapon production
    facilities. Under this concept, the management and operating contract
    for the Kansas City Plant in Kansas City, Missouri, the Y-12 Plant in
    Oak Ridge, Tennessee, and the Pantex Plant in Amarillo, Texas, would be
    consolidated into a single contract to improve programmatic performance
    and integration.
                                    tritium
        Current policy requires the Department to develop a new tritium
    production source by about fiscal year 2005 to support a START I
    nuclear stockpile with a five-year reserve, and to maintain the ability
    to ``hedge'' to a START I level even if the START II Treaty enters into
    force. Tritium, which decays fairly rapidly, has not been produced in
    the U.S. since 1988 and defense requirements have been met by the
    recycling of tritium from dismantled weapons. Secretary Richardson
    announced on December 22, 1998, a decision to use existing light water
    reactors as the primary source of tritium production. He designated the
    Tennessee Valley Authority's Watts Bar and Sequoyah reactors as the
    preferred facilities. Consistent with the Department's dual track
    strategy, the Secretary designated the linear accelerator as the back
    up technology for tritium production. As such, the Department will
    complete engineering development and preliminary design for the
    Accelerator Production of Tritium (APT). The Secretary stated that the
    use of existing TVA reactors was preferred because this alternative
    uses proven technology, offers the best deal for taxpayers, has the
    most flexibility to meet present and future tritium requirements, and
    is most consistent with U.S. arms reduction goals. An interagency
    agreement with TVA under the Economy Act on an as-needed, pay-as-you-
    go, cost basis is nearing completion and will result in operating costs
    being as low as possible for the production of tritium.
        The Secretary of Defense publicly endorsed the Secretary's tritium
    production decision, and the Chairman of Nuclear Regulatory Commission
    (NRC) has made a commitment that the NRC will expeditiously review
    requests for regulatory approvals associated with the use of tritium-
    producing fuel rods in NRC-licensed reactors. The production of tritium
    at TVA facilities is expected to begin in 2003. The tritium gas will be
    extracted from the rods at the Tritium Extraction Facility (TEF) at the
    Savannah River Site. Construction of the TEF will begin in fiscal year
    2000 and will be completed in time to support stockpile tritium
    requirements.
        During the three years since the Record of Decision on the
    Environmental Impact Statement for Tritium Supply and Recycling, the
    projects for both dual-track options were subjected to numerous reviews
    by independent groups of experts. Regulatory oversight was provided by
    the Defense Nuclear Facilities Safety Board and the U.S. Nuclear
    Regulatory Commission (NRC) in appropriate areas. A review of
    nonproliferation aspects was provided by an interagency review group.
                             experimental programs
        It is at the DOE's Los Alamos, Sandia, and Lawrence Livermore
    National Laboratories and at the Nevada Test Site that the science base
    of the Stockpile Stewardship Program is developed. Experimentation is
    how, in the absence of nuclear testing, we divide the physics of the
    explosive sequence into each of its parts, and analyze each separately.
    Information that we have from the production and surveillance
    activities described previously, helps us to focus our experimental
    work. Information that we have from over 1,000 U.S. nuclear tests also
    tell us what we don't know and where we need to fill in gaps in our
    knowledge through experiment and observation.
        Hundreds of experiments, large and small, are performed each year
    in support of Stockpile Stewardship. Subcritical experiments performed
    at the Nevada Test Site have received considerable publicity. The sixth
    subcritical experiment, Clarinet, took place on February 9, 1999. This
    experiment was the second of three planned for fiscal year 1999. Two
    subcritical experiments are planned for fiscal year 2000 and additional
    subcritical experiments are being considered.
        Subcritical experiments provide empirical data on the high pressure
    behavior of plutonium; realistically benchmarking data on the dynamic,
    non-nuclear behavior of components in today's stockpile; analyzing the
    effects of remanufacturing techniques; understanding the effects of
    aging materials; and addressing other technical issues. Information
    from these experiments will be key to qualifying the pit production
    capability at Los Alamos National Laboratory (LANL), as well as
    certifying the performance of weapons which will contain the
    replacement pits. These experiments also contribute significantly to
    the maintenance of the critical infrastructure and educational base of
    skilled personnel at the Nevada Test Site. In addition to helping us
    understand the effects of aging on plutonium, these experiments are key
    to our test readiness program. Subcritical experiments are consistent
    with the safeguards under which the President has recommended
    ratification of the Comprehensive Test Ban Treaty (CTBT).
        We do a good job of investigating the first part of the nuclear
    explosion; that is, the implosion of the plutonium pit by high
    explosive, with non-nuclear experiments. We can measure a number of
    important features by taking x-ray pictures during critical parts of
    the experiment. We can then compare these pictures with calculations
    and with previous data from the more than 1,000 underground nuclear
    tests and 14,000 surveillance tests. During fiscal year 1998, we
    conducted some 50 non-nuclear hydrotests at the Pulsed High Energy
    Radiographic Machine Emitting X-rays (PHERMEX) and the Flash X-Ray
    (FXR) machine facilities at LANL and Lawrence Livermore National
    Laboratory (LLNL). We will do approximately the same number in fiscal
    year 1999 and in fiscal year 2000. In addition, we plan to conduct
    approximately 150 less complex experiments per year aimed at
    understanding and answering questions about high-explosives behavior
    and explosive effects on materials.
        Experiments using the Los Alamos Neutron Science Center (LANSCE)
    are investigating proton radiography, a new technique in which proton
    beams from a linear accelerator are used directly in a novel approach
    to hydrodynamics-radiography that, if successful, could provide
    additional information to our process of certifying pits. This
    technique is one of the candidate technologies being considered to make
    detailed, three-dimensional ``motion pictures'' of the implosion
    process. Smaller-scale dynamic proton radiography experiments have
    already been performed at LANSCE to address important certification
    issues (e.g., cold high-explosives performance), paving the way for
    validation of advanced explosives simulation models.
        This year we will be conducting a series of measurements at the
    Brookhaven National Laboratory as a next step in evaluating protons for
    weapon radiography. Such technology could be used in an advanced
    hydrotest facility. Accelerator experiments are also being used to
    probe basic properties of weapons materials that have a direct bearing
    on the functional lifetime, hydrodynamic behavior, nuclear performance,
    aging and corrosion of weapons materials and components. Based on these
    experiments, data can be extracted on equation of state, strength,
    microstructure, and aging properties of weapons materials.
        In the area of inertial confinement fusion (ICF), the Department is
    conducting an aggressive research program to support the stockpile. In
    order to transfer resources to the National Ignition Facility project,
    the Nova laser at LLNL is scheduled for shutdown in 1999. Program
    emphasis will shift to the Omega laser at the University of Rochester.
    About 1,300 shots are planned for Omega in fiscal year 2000. A major
    activity at Omega in fiscal year 1999-2000 will be installation and
    operation of a cryogenic target handling system in preparation for
    deuterium-tritium cryogenic fuel implosion experiments.
        In 1998, the Z-pulsed power facility at Sandia National
    Laboratories achieved a record x-ray energy and temperature levels. In
    1999 and 2000, we plan to conduct about 160 shots in Z in the areas of
    weapons effects, weapons physics and NIF ignition. The major activity
    in Z over the next two years will be the installation of the Beamlet
    laser from Lawrence Livermore National Laboratory which will be used as
    a diagnostic on Z. This diagnostic will enhance investigations in all
    areas. The ICF program is implementing a detailed multi-laboratory
    national ignition plan to achieve ignition and to address other
    stewardship issues during NIF operations.
        These, and other experimental facilities that are on line or under
    construction, are expected to give us a set of tools sufficient to
    investigate and understand anticipated problems in the stockpile.
    Whenever feasible, the goal is to obtain data experimentally by more
    than one method in order to improve our confidence in the associated
    physics models being used in the advanced Accelerated Strategic
    Computing Initiative (ASCI) simulation codes.
                   progress on major experimental facilities
        Construction is well underway for three major facilities that are
    essential to the long-term success of the Stockpile Stewardship
    Program--the National Ignition Facility (NIF), the Dual-Axis
    Radiographic Hydrodynamic Test Facility (DARHT), and Atlas. NIF, the
    world's largest laser, will enable our scientists to generate
    conditions of temperature and pressure approaching those that occur in
    nuclear weapons. Demonstrations of how aged or changed materials could
    behave under these unique conditions will provide data essential to
    test the validity of computer based predictions. The NIF building is
    about 47 percent completed. The siding and roofing were completed in
    November 1998. A major event this summer will be the installation of
    the target chamber. The first NIF experiments are planned to begin in
    October 2001 using eight of 192 laser beams. The NIF is expected to be
    completed on schedule in October 2003, and on budget at $1.2 billion.
        We continue making good progress in completing the DARHT facility.
    This facility will examine the shape and size of an imploding pit model
    from two different directions with greatly improved radiographic
    resolution. DARHT will also demonstrate a capability of multi-pulsing
    to obtain pictures at more than one point in the implosion process.
    Construction of the facility to house the x-ray machines was completed
    and the first arm of the facility, using a single pulse accelerator,
    will be operational with experiments scheduled to begin this summer.
    Design and prototyping of the second arm is well underway and this
    multi-pulse machine is scheduled for completion in fiscal year 2002.
        The Atlas pulsed power facility is under construction at LANL. The
    design of Atlas is complete, the large and long-lead procurements have
    been placed, and the assembly of the first segment of the machine is
    underway. The Atlas facility is scheduled to be completed and commence
    operations in 2000. Atlas will provide an improved capability to
    conduct hydrodynamic experiments for assessment of secondary assemblies
    in nuclear weapons.
                           simulation and computation
        The Accelerated Strategic Computing Initiative (ASCI) is developing
    the high-performance computational modeling and numerical simulation
    capabilities necessary to integrate theory, existing data, and new
    experimental data to predict results that can be verified and
    validated. The ASCI program, a collaborative effort between the
    Government and U.S. industry, is developing the world's fastest, most
    powerful computational and advanced simulation and modeling
    capabilities. These advanced supercomputers are needed to complete the
    shift from nuclear test-based methods to science-based methods and to
    assess and certify the safety, security, and reliability of the
    stockpile without underground nuclear testing.
        Advanced computational capabilities that include application codes,
    computing platforms, and various tools and techniques, are being
    developed under ASCI and incorporated into ongoing stockpile
    computational activities. This technology is being developed at about
    twice the rate of commercial computing speed and power advances. ASCI
    has been highly successful in meeting its milestones and providing
    effective new tools to support stockpile stewardship. Information
    developed from other elements of the Stockpile Stewardship Program,
    such as NIF and our subcritical experiments, will provide the basic
    physics models and data for ASCI simulations.
        At the end of fiscal year 1998, ASCI unveiled its second generation
    of computing systems. Two major systems capable of running in excess of
    three trillion operations per second (3 teraops) peak speed were
    delivered ahead of schedule and within budget. Blue Pacific, developed
    by IBM, is located at LLNL, and Blue Mountain, developed by Silicon
    Graphics, Inc., is located at LANL. These systems are each 15,000 times
    faster and have roughly 80,000 times the memory of the average personal
    desktop computer. On February 12, 1998, the Department announced the
    selection of IBM to partner with ASCI on the Option White 10 teraops
    supercomputer to be located at LLNL. Building upon the experience and
    knowledge gained with the 3 teraops Blue Mountain system, LANL will
    conduct a procurement for a computational system that will achieve a
    peak performance level of 30 teraops by mid-year 2001. And the
    Department's first generation, Option Red Intel computer system,
    installed at Sandia National Laboratories in 1996, with a peak speed of
    1.8 trillion operations per second is now operating in production mode.
        The unprecedented computational power of ASCI is also being made
    available to selected groups in the university community through the
    Academic Strategic Alliances Program. In 1997, the Department awarded
    contracts to five major U.S. universities--Stanford University,
    California Institute of Technology, the University of Chicago, the
    University of Utah and the University of Illinois. The work of the
    university teams will be of similar difficulty and complexity to that
    needed for Stockpile Stewardship and provide another benchmark by which
    we can assess the accuracy of our own work. These projects are expected
    to lead to major advances in computer simulation technologies as well
    as to discoveries in basic and applied science; areas important to
    ASCI, the broader Stockpile Stewardship Program, and other application
    areas. Applications being developed and run by the university teams are
    unclassified and deal with significant non-defense scientific, economic
    and social priorities.
        We are already utilizing the capabilities of the newly installed
    ASCI platforms to support assessment of the stockpile. Specifically, we
    have run the highest resolution safety simulation of a stockpile
    weapon, and we have run a 3-dimensional simulation that will help
    explain a ``mystery'' from the nuclear test archives, that is relevant
    to our current program. We have run simulations to support the
    certifications of the B61 modification and the W76 neutron generator.
    These simulations would not have been possible without the capability
    provided by the ASCI platforms performing at the teraops level.
    However, in order to simulate a 3-dimensional full-system weapon and
    its performance as defined by nuclear weapons designers, scientists,
    and engineers at DOE national laboratories, we must scale the current
    capability to the 100 teraops level by 2004.
        The fiscal year 2000 request for the ASCI and Computations program
    operating budget, which totals $543 million, is about 12 percent higher
    than the fiscal year 1999 request. In addition, $114 million for
    simulation activities that previously were part of the ASCI program
    plan and $36 million for construction projects to house ASCI computers
    is requested. The fiscal year 2000 request is in line with planned
    increases resulting from advances in code development work and with
    simulations that necessitate additional memory, storage, and networking
    capability. It continues the momentum in both hardware development and
    acquisition to obtain computers capable of sustained operations of 100
    teraops level by 2004. It also permits building 3-D computer codes,
    which in conjunction with the other experimental programs such as
    inertial confinement fusion, are aimed at providing the required levels
    of fidelity in weapons simulations.
        Two new computational initiatives begun in fiscal year 1999 will
    continue in fiscal year 2000. The Distributed Computing at a Distance
    (DisCom2 ) project develops key computing and communications
    technologies that will enable DP laboratories and plants to apply high-
    end computing across thousands of miles, to meet the urgent design,
    analysis, and engineering needs of Stockpile Stewardship. The Numerical
    Environment for Weapons Simulations (NEWS) will create data exploration
    super corridors at the weapons laboratories to support large-scale data
    analysis for researchers and weapons assessment teams.
        nuclear emergency response and technology partnerships programs
        There are two other elements that exist across the weapons complex
    that play a role in maintaining the leading edge expertise of our
    people and program. Defense Programs funds DOE's nuclear emergency
    response programs which primarily consist of engineers, scientists, and
    other technical personnel from the three weapons laboratories,
    production facilities, and other DOE management and operating
    contractors. This program provides a technical response capability for
    any type of radiological or nuclear accident or incident including
    radiological releases, U.S. nuclear weapons accidents, or a malevolent
    event involving a nuclear device or radiological dispersal device. A
    robust exercise schedule provides challenging scenarios for all
    radiological emergency response assets in order to maintain and verify
    departmental readiness to meet our mandated responsibilities in
    conjunction with a wide range of interagency programs (e.g. Defense
    Threat Reduction Agency, Federal Emergency Management Agency, FBI,
    etc.). These scenarios include overseas nuclear weapons accident
    exercises, field training exercises, multi-agency resolution of nuclear
    terrorism crises, response to transportation accidents and commercial
    nuclear reactor accidents.
        The DP Technology Partnership Program, which has been restructured
    to directly support Stockpile Stewardship, represents an important
    investment in the future. The private sector has technical leadership
    in many areas critical to weapons activities and the Technology
    Partnership Program initiates effective collaborations between the
    laboratories and industry that strengthen all Stockpile Stewardship
    Program components. It is a difficult task, but we already have
    success. For example, Sandia and a world class commercial electronics
    supplier of radio frequency (RF) products are partnering to develop a
    replacement arming, fusing and firing system for the W76/Mk4. This
    project will develop the capability for procuring war reserve RF
    components from a state-of-the-art, tailored, low-cost, low-volume,
    high- reliability manufacturing process. In addition, LANL is working
    with a provider of highly advanced, ultra-short pulse laser technology
    to develop sophisticated devices that will give LANL an entirely new
    capability to non-destructively inspect and measure the interior of a
    pit with extremely high resolution.
                              program integration
        You have heard about how, over the last several years the
    Stewardship program has successfully set in motion a series of
    initiatives to ensure high confidence in the safety and reliability of
    the nuclear weapons stockpile without nuclear testing or traditional
    new weapon development. Core technical capabilities have been fostered
    and facility milestones have been established to strengthen a strong
    science-based foundation for Stewardship. Construction of facilities
    like DARHT, NIF, and Atlas is now underway to provide state-of-the-art
    experimental facilities for pursuing fundamental weapons physics
    understanding. The subcritical experiments at NTS return extremely
    valuable data on the dynamic materials behavior of explosively driven
    plutonium. The ASCI program has successfully delivered world-class
    computational power and has focused and paced the development of
    simulation-based predictive capability that is required to integrate
    the scientific knowledge derived through ongoing experimental and
    theoretical program efforts. A Stockpile Life Extension (SLEP) program
    has formalized a disciplined process for introducing needed changes to
    the enduring nuclear weapons stockpile to address age-related risk. The
    time has now come to direct attention on a focused approach toward
    integrating and synchronizing the various ``tools'' of the Stewardship
    ``toolkit'' to more effectively achieve strategic program objectives;
    namely, by methodically applying science in a timely way to confidently
    manage life extension in the nuclear weapon stockpile.
        In the fall of 1998, I chartered a Program Integration Task Force
    comprised of senior managers of the nuclear weapons laboratories and
    production plants, as well as the appropriate headquarters personnel
    with stewardship management responsibilities. The Task Force provided
    recommendations for: (a) taking the next steps toward more effective
    integration of science with stockpile deliverables; (b) providing more
    overall coherence among all program elements; and (c) identifying a
    basis for system-wide planning of program and budget.
        The Task Force reported back to me in late November 1998. One of
    its main recommendations was to eliminate the organizational interface
    between the core stewardship R&D program, and the ASCI and stockpile
    computing program. This imperative was driven by the urgent need to
    accelerate integration of experimental data with the major three-
    dimensional weapons computer applications codes under development. In
    validating these codes, an improved predictive capability, derived from
    enhanced physics understanding of weapon performance and safety issues,
    could be more confidently applied in meeting critical certification
    milestones associated with stockpile life-extension modifications. As a
    result of this consolidation, the weapons science activities of the new
    organization could be more coherently managed at the interface with
    stockpile manufacturing and production activities.
        The Task Force also emphasized the imperative for Headquarters to
    vigilantly manage the program balance at the science/production
    interface. Its suggestion was to apply a risk management approach in
    making programmatic tradeoffs between resources and deliverable
    schedules. The principle is fairly simple: weapons science activities
    not well integrated with stockpile deliverables would, in time, lose
    focus and drift away from relevancy and strategic objectives linked to
    the continued certification of weapon performance, safety, and
    reliability. On the other hand, any weapons production without the
    active integration of science through rigorous certification would
    eventually result in the inevitable loss of confidence without nuclear
    testing, thus losing nuclear deterrence for the Nation. Balancing these
    two major efforts under the stewardship ``umbrella'' will demand a more
    keen attention to enterprise-wide planning and budgeting, always
    governed by the principle that budget requirements should reflect an
    integrated set of program objectives.
        In December of 1998, I took action on these Task Force
    recommendations by integrating the Stewardship science program under a
    new organization, the Office of Research, Development, and Simulation.
    This office is now actively pursuing program integration by working
    with the nuclear weapons laboratories and Nevada Test Site to jointly
    identify and begin planning a set of ``weapons technology campaigns''.
    A ``campaign'' is defined as a major technical effort that focuses
    resources on developing a critical enabling technology to support
    confident certification.
        A compelling weapons science or technology issue that demands a
    measurable enhancement in predictive capability will drive each
    campaign. Thus, each campaign will be designed to integrate
    experiments, simulation, and weapon-system assessments. Campaigns will
    be focused on achievable goals and identifiable end states for the 2004
    time frame. The three laboratories and NTS will join in a common,
    complementary effort to define appropriate technology milestones.
    Technical efforts will be designed to exploit the current experimental
    and computational infrastructure to the maximum extent feasible, while
    integrating new capabilities as they become available. Collectively,
    the campaigns will be aimed at enhancing certification in the 2004 time
    frame, when about half of our nuclear-test-experienced weapon designers
    will have retired. By aggressively pursuing these integrating
    campaigns, we expect to successfully meet the challenges of the next
    decade.
        Campaigns will result in a clearer set of program expectations tied
    to needs and priorities. This in turn will result in our ability to
    articulate our deliverables and budget requirements far more precisely
    and far more measurably than has been done in the past. Ultimately, I
    believe, this will result in a better understanding of what the public
    is buying for the funds provided. I am convinced that it will also
    provide, in the future, a clearer and more demonstrable model for
    addressing what can not be provided at a given level of resources.
                                   conclusion
        These are but a selection of the broad range of on-going planned
    Stockpile Stewardship Program activities. Let me reemphasize that the
    current stockpile is well tested and well understood. The designers and
    engineers who built our existing weapons are still available and are
    still active. Indeed they are the ones who are creating the Stockpile
    Stewardship Program. They are the ones who are working on the stockpile
    now, and are helping to train their successors. We are mindful,
    however, that the clock is ticking on both the design life spans of the
    weapons, and the career spans of test-experienced designers, engineers,
    and production experts. We have an unprecedented, but time sensitive,
    challenge to put in place both the tools and the people that will carry
    us beyond test-based expertise to science-based expertise for the
    future.
        If supported appropriately, I believe the Stockpile Stewardship
    Program can indefinitely maintain a safe and reliable stockpile without
    the need to conduct nuclear testing. I know of no other national
    security issue that is more important for our Nation today and for the
    next millennium.

                       statement of rose e. gottemoeller

        Senator Domenici. Thank you.
        Ms. Gottemoeller, would you proceed with your testimony?
    Your written remarks will be made a part of the record. If you
    would abbreviate your oral remarks, and we will wait on the
    questions till all three witnesses have testified, then we will
    proceed.
        Ms. Gottemoeller. Yes, Mr. Chairman. I would like to have
    my remarks entered into the record. Thank you for the
    opportunity to appear before this committee and discuss our
    fiscal year 2000 budget request.
        In my oral remarks, I would really like to hit a few of my
    office's planned activities as highlights for fiscal year 2000.
    The President has identified weapons of mass destruction
    proliferation as a national emergency, and I am proud of the
    role that DOE and my office play in responding to that
    emergency.

              material protection, control and accounting [mpc&a]

        Our total request for fiscal year 2000 is $747.3 million,
    representing an 11 percent increase over our fiscal year 1999
    appropriation. This increase reflects the growing threat to
    U.S. security in both international and domestic arenas. Russia
    is at the top of our priority list. Through our Material
    Protection, Control and Accounting, or MPC&A program, we are
    helping Russia secure its nuclear weapons nuclear materials and
    reduce the risk that these materials will be diverted to the
    weapons in rogue regimes or terrorist organizations.
        This has been a highly successful effort which has expanded
    to include 55 facilities throughout the former Soviet Union. To
    date, we have completed upgrades on 30 metric tons of material
    and have improved the security of some 400 tons, metric tons,
    in total. We are working now at virtually every site we know of
    that contains weapons--usable nuclear materials in the former
    Soviet Union, including the major sites in the Russian defense
    complex.
        We still have much work to do, since we know that the
    Russians have at least 650 tons of nuclear material not in
    weapons and in need of upgraded protection, but we have
    developed the goodwill and the structure needed to efficiently
    pursue the security of the remaining stocks of nuclear
    materials.
        Senator Domenici. Might I ask, why do you say 650 tons? Do
    you accumulate all kinds, rather than telling us what each one
    is?
        Ms. Gottemoeller. Yes, sir. That is an accumulation of
    plutonium as well as highly enriched uranium. It is the
    planning number that we use, although we know from our
    interactions with our Russian colleagues that the number may be
    larger than that.
        Senator Domenici. Okay. Go ahead.
        Ms. Gottemoeller. We are requesting $145 million for this
    effort in fiscal year 2000. Our efforts in the area of Russian
    military security are made possible in large part because DOE's
    role and my office's role is important in setting the
    international standard for the production of nuclear materials
    and facilities here in the United States.

     initiatives for proliferation prevention and nuclear cities initiative

        I would now like to turn to the other side of the Russian
    proliferation problem, the brain drain. Our Initiatives for
    Proliferation Prevention programs and our newly launched
    Nuclear Cities Initiative are working to address the complex
    issues in this arena. I know much has been said and written
    recently on these efforts, but I would like to say this. We
    have through the initiatives for proliferation prevention
    successfully kept thousands, at last count over 5,900, former
    Soviet weapons experts at home and out of weapons work in rogue
    States, terrorist groups, and criminal organizations.
        As the General Accounting Office recommended, we need to do
    a better job of ensuring more money gets to Russia. We also
    need to redouble our efforts to achieve commercial success with
    these projects. However, the overall goal, as GAO actually
    acknowledged, of keeping these experts at home is succeeding.

                          international nuclear safety

        Elsewhere in our Russia-related activities, I am pleased to
    report that my office has successfully completed integrating
    the Department's Office of International Nuclear Safety into
    our structure. There is a natural synergy between the nuclear
    safety work and my office's more traditional missions. We are
    making excellent progress in improving the safety of Soviet
    reactors, including improving Soviet safety diagnosis and
    response training, pursuing the installation of safety
    equipment, and establishing regional nuclear safety training
    centers.
        Moreover, our efforts to aid the closing of the Chernobyl
    complex continue and, indeed, are intensifying in fiscal year
    2000. While we work to counter threats abroad to our national
    security, we are stepping up our security efforts here at home.
    The threats to domestic safety and security are more diverse
    than ever and, at the direction of President Clinton and
    Secretary Richardson, we are moving smartly to address these
    concerns.

                        chemical and biological weapons

        The Department, through my office, is rapidly pursuing the
    President's call to improve our chemical and biological
    detection and identification capabilities. For our chem-bio
    initiative we are requesting a 70-percent increase from $19 to
    $32 million in fiscal year 2000.
        The prime goal of these efforts is to provide first
    responders with portable, fast, and accurate tools to detect
    and ID chemical and biological agents. With one anthrax hoax in
    the United States every day, the ability to detect hoaxes and,
    in the worst case, confirm the use of chemical or biological
    agents is vital to reducing the effect of such events. Our
    investment in this area is leveraging the already strong
    expertise residing in the national laboratory system,
    especially those in the fields of chemistry and biology.
        In addition to our CBW detection work, other important
    technical advances are being pursued in our arms control
    research and development area. The tools being developed
    through this office will improve our ability to detect
    proliferant activities in other countries and increase our
    confidence in the verifiability of international agreements
    such as the comprehensive test ban treaty.

                               domestic security

        Now, sir, I would like to turn to our domestic security
    missions, which are equally important and challenging. Our
    Office of Security Affairs continues its vital role in
    protecting classified information and the security of the DOE
    complex overall. This has been another frequently discussed
    topic in recent months, but I would like to say this. Our
    mission requires us to remain accountable to the American
    public. To do this, we must effectively balance two equally
    essential missions, protecting classified information to
    prevent others from using it to harm U.S. interests, and
    keeping secret only that information which needs to be
    protected.
        To meet these goals, the Department is working aggressively
    to review materials before they're released to ensure the
    absence of restricted or formerly restricted data as Congress
    has required. At the same time, we are working to comply with
    President Clinton's executive order to declassify documents
    that no longer require protection.

                              emergency management

        The last program I would like to mention is one that gets
    few headlines but allows me and my colleagues in the DOE
    leadership to get to sleep at night, from time to time anyway.
    This is the Office of Emergency Management, which is also
    operated out of my office 24 hours a day, 7 days a week, 365
    days a year. Our staff is ready to respond to any of a wide
    variety of possible events that would affect our national
    security and safety, and the overall performance of the DOE
    complex.

                               prepared statement

        There are many additional programs in our office, and time
    does not allow for as complete a listing as I would like to do,
    but I will be happy to answer any of your questions.
        Thank you, Mr. Chairman.
        [The statement follows:]

                   Prepared Statement of Rose E. Gottemoeller

                                  introduction
        Thank you, Mr. Chairman and members of this Committee, for the
    opportunity to appear before you today to present this statement for
    the record on the Department of Energy's fiscal year 2000 budget
    request for the Office of Nonproliferation and National Security (NN).
    The Department of Energy generally, and the Office I head specifically,
    have received extremely strong support from this committee. I'd like to
    thank you for that support and say that I look forward to working with
    you in the future as we work to address some of our nation's most
    important and critical challenges.
        It has been stated many times, but it bears repeating: The world we
    face today is vastly changed from the one we lived in during the cold
    war. The challenges we face are more varied and less predictable. None
    of the threats we face is more serious than the proliferation of
    weapons of mass destruction to rogue states and, even more worrisome,
    terrorist organizations. The President has declared the threat of
    weapons of mass destruction (WMD) proliferation to constitute a
    ``national emergency'' and I am proud of the role the Department of
    Energy, and my Office in particular, is playing in responding to that
    emergency.
        Within the Department, the Office of Nonproliferation and National
    Security is unique in the range of our contributions to national
    security. The Office is responsible for national security missions in
    both domestic and international settings. In Russia, DOE employees and
    laboratory experts are on the ground and actively working to improve
    the security of hundreds of tons of plutonium and highly enriched
    uranium at dozens of facilities. We are also working with thousands of
    former Soviet Union weapons scientists to provide them with non-weapons
    jobs and prevent them from straying into work with countries of
    proliferation concern. Here at home, we are accelerating our efforts to
    harness the skills of the national laboratories to meet the growing
    threats of chemical and biological weapons and the very serious risk
    that such weapons will be used on U.S. territory. In addition, my staff
    is ensuring the protection of U.S. nuclear materials and of DOE sites.
    At the same time, we must balance the critical job of protecting this
    nation's nuclear secrets, with meeting our obligation to declassify
    appropriate documents to ensure our accountability to the American
    people.
                        fiscal year 2000 budget request
        The Office's fiscal year 2000 budget request is $747.3 million,
    representing an 11 percent increase over our fiscal year 1999
    appropriation. This increase reflects the ever growing challenges our
    nation faces in the international, as well as domestic arenas. While I
    won't, in my prepared remarks, go into detail on all of our programs, I
    would like to highlight for you some of our main projects and some
    areas of proposed expansion in 2000.
                  material protection, control and accounting
        First, I will turn to the situation in Russia. The members of this
    committee are keenly aware of the importance Russia plays in our
    overall nonproliferation strategy. For several years, we have been
    building up a legacy of trust and personal relationships that has
    allowed us to cooperatively pursue security upgrades throughout the
    Russian nuclear complex. The importance of this work, carried out under
    our Material Protection, Control and Accounting (MPC&A) program, cannot
    be overstated. Our programs have been key to international efforts to
    prevent the acquisition of nuclear weapons by terrorists or would-be
    nuclear states. In this goal, we have made considerable progress, but
    we have recognized that the task before us is much greater than we
    understood when this program began in 1994. Russia's economic collapse
    in August has forced us to re-evaluate our methods and priorities and
    brought, from the Russians themselves, a renewed sense of urgency to
    our cooperation. This now includes an increased awareness of the
    ``insider threat'' of nuclear materials diversion and an understanding
    that the size, and geographic scope of the nuclear enterprise is larger
    than had been appreciated in 1994.
        With this background, over half of our proposed budget increase
    would be dedicated to our Office of Arms Control and Nonproliferation,
    which implements our Russian nuclear security efforts. The Russian
    MPC&A program would receive $145 million, which represents a $5 million
    increase over last year but an almost $40 million increase over our
    original baseline. This effort includes a long-range plan that will
    continue beyond our original completion date of 2002. Our extended
    deadline reflects one simple fact--the job of securing nuclear
    materials is a much harder and a larger endeavor than anyone--including
    Russia--understood when our program began. While we will have completed
    upgrades on the number of sites originally included in our program
    plan, designed in 1994, we have secured Russian agreement to cooperate
    on more than two dozen facilities that we didn't even know existed when
    the program began. In addition, in order to limit the program's overall
    requirements, we are venturing for the first time into the long-overdue
    area of ``materials consolidation.'' The Russians themselves have
    finally realized the risks associated with maintaining such a far flung
    nuclear complex. Our cooperative consolidation efforts will help reduce
    the number of facilities housing nuclear materials, thereby reducing
    the strain on the Russian system and the long-term MPC&A requirements--
    including our own.
        A word, if I may, about the absolutely incredible men and women who
    have been working on this problem night and day for the past several
    years. The image of the civil servant and government bureaucrat has
    been impugned for years in our society. I know that the members of this
    committee are well aware that the average civil servant is motivated
    and hardworking, but I have been struck since I became director of NN
    by the absolute dedication of our MPC&A task force and the almost
    superhuman level of their efforts. Their travel includes some of the
    most remote and least hospitable locations in the world, spending weeks
    away from family and basic comforts and making repeated trips to such
    locations in order to facilitate and complete their assignments. The
    work load for the average MPC&A Task Force member is extreme, as we had
    sought to limit the task force size to one appropriate for a limited
    duration project. This is an issue that we are examining extremely
    closely at the present time, in the expectation that the team will
    become larger and longer range in its organizational outlook.
        Our ability to address Russian nuclear security concerns comes in
    large part from NN's responsibilities at home for the protection of
    nuclear materials. These include directing a rigorous safeguards and
    security program for the entire Department of Energy complex to ensure
    the demonstrated security of our own nuclear materials. Our work in
    Russia has benefitted greatly from our direct expertise in the
    protection of materials and facilities here at home, and from the
    knowledge that our efforts and accomplishments set the international
    standard for the protection of nuclear materials.
        While we still have considerable work in ahead of us to upgrade
    security around Russian nuclear materials, we are also striving to
    address other sources of proliferation risk and concern in the former
    Soviet Union. We consider our work at nuclear sites to be the first
    line of defense against the proliferation of nuclear weapons. The
    second line of defense is the internal borders of Russia, and helping
    to ensure that any stolen or misappropriated materials cannot leave the
    country. Our Second Line of Defense program has already installed
    nuclear material detectors at the main international airport in Moscow
    and at the Caspian seaport of Astrakhan. We have identified 22
    additional border crossings that for tactical or strategic reasons
    warrant the installation of similar equipment. This is yet another
    example of how a relatively small investment can help protect ourselves
    and our friends against the greatest of threats.
       initiatives for proliferation prevention/nuclear cities initiative
        Another critical component of our nonproliferation efforts in the
    former Soviet Union is our effort to engage and orchestrate alternative
    employment for underemployed and unemployed ex-Soviet weapons
    scientists. Through our Initiatives for Proliferation Prevention
    program, we have worked with over 170 institutes and sponsored
    collaborative scientific efforts with over 4000 ex-Soviet nuclear,
    chemical and biological weapons experts. This work has helped keep
    these experts in Russia and the Newly Independent States, as opposed to
    selling their know how to rogue regimes, criminal groups or terrorist
    organizations.
        We are embarking on a much more comprehensive enterprise which also
    seeks to develop alternative, non-weapons jobs for weapons scientists,
    this time as part of our Nuclear Cities Initiative. The ten closed
    nuclear cities in Russia are the jewels in the Russian nuclear crown.
    We are pleased that Russia is finally taking steps to reassess and
    restructure their nuclear complex and has approached us about helping
    to develop new jobs for weapons scientists who will lose their defense
    work as weapons facilities close. We are approaching this endeavor with
    a mixture of commitment and pragmatism, realizing that such efforts
    will take time. But the goals of keeping the Russian weapons scientists
    at home, and helping to reduce the size of the Russian nuclear
    infrastructure, contribute directly to U.S. security.
        The Department of Energy, and my Office in particular, has taken
    note of the concerns expressed in the General Accounting Office's
    recent report on our Initiatives for Proliferation Prevention program.
    We are working aggressively to implement their recommendations and
    believe that adoption of their comments will greatly improve what is
    already a successful enterprise. These include a strengthened review
    process to further ensure non IPP projects have dual-use benefits for
    Russian military programs and an increased effort to provide a greater
    percentage of resources to Russian and NIS scientists.
                  international nuclear safety and cooperation
        Elsewhere in the former Soviet nuclear complex, NN is now actively
    engaged in the area of international nuclear safety. The transfer of
    the Department's international nuclear safety activities into NN is now
    complete and has gone extremely well. There is a very strong natural
    connection between various Russian and NIS activities within NN's
    already existing projects and the nuclear safety initiatives. We
    continue to make excellent progress in improving the safety to Soviet-
    designed nuclear reactors and establishing self-sustaining nuclear
    safety infrastructures. We are addressing the most serious risks at
    these reactors by improving the plants' physical operating conditions,
    installing safety equipment, developing improved safety procedures,
    establishing regional centers for training reactor personnel, and
    conducting in-depth safety assessments of the operating plants.
                          national security challenges
        Our work in Russia, as important as it is, must not and does not
    distract our attention from our critical and considerable domestic
    activities. The changed situation abroad is matched by a changing
    picture at home. The President highlighted his concerns about new
    domestic threats in January at a National Academy of Sciences event in
    which he stated that ``The enemies of peace realize they cannot defeat
    us with traditional military means. So they are working on two new
    forms of assault: cyber attacks on our critical computer systems, and
    attacks with weapons of mass destruction--chemical, biological,
    potentially even nuclear weapons. We must be ready--ready if our
    adversaries try to use computers to disable power grids, banking,
    communications and transportation networks, police, fire and health
    services--or military assets.''
        President Clinton, and his entire national security team, are
    increasingly concerned about these threats. We are, at the President's
    direction, making concerted and coordinated efforts to meet these
    growing challenges. Let me explain what DOE and NN are doing in this
    area.
                        chemical and biological threats
        Among the Secretary's top priorities is responding to the growing
    threat of chemical and biological (CBW) attacks inside the United
    States. The Department of Energy, drawing upon the diverse and
    extensive expertise of the national laboratories, has extraordinary
    assets in the fields of biology and chemistry, pursued for both the
    pure and applied scientific value. With relatively modest sums of
    money, the Department is seeking to leverage these skills and
    experience to improve our ability to detect and identify biological and
    chemical agents.
        To pursue this work, we are requesting a total of $32 million,
    which is a $13 million or 70 percent increase over our 1999
    appropriations. The focus of these efforts is to better equip first
    responders with the tools to identify and categorize chemical and
    biological agents. The tools we seek to develop must be portable, fast,
    accurate and simple, so that they can be put to immediate use in the
    field, serving to protect the American public from hoaxes or, worse,
    actual attacks.
        Again, Mr. Chairman, defining the challenge is as simple as
    answering it is complex. There is, on average, one anthrax threat in
    the United States every day. In January, the shortcomings of our
    current capabilities were made glaringly clear, when an anthrax threat
    was directed at the 7th floor of the Department of State. While this,
    fortunately, turned out to be a hoax, we need to do better in fielding
    smart systems capable of detecting potential WMD agents. Today, there
    are no simple, portable and reliable detection and identification tools
    for biological agents available to those officials who are assigned the
    role of getting to the scene of a CBW attack first. Delays in assessing
    the credibility and severity of specific incidents create confusion,
    waste resources, and, in the event of a real attack, costs lives. In
    sum, our limited abilities in this area actually increase the
    ``terror'' effect of such attacks or hoaxes, thus inviting additional
    events. The sooner we can field the types of portable detection
    equipment we are working on, the sooner we will be able to deter and
    reduce the number of such attacks.
        There are questions raised from time to time about why involve the
    Department of Energy--whose weapons expertise is focused in the nuclear
    arena. To be direct, DOE and its laboratories have a broad range of
    ongoing programs in biological and chemical areas which provide it with
    a unique set of skills to apply to this problem. Although originally
    developed in the service of our primary nuclear mission, these world-
    class capabilities can be leveraged for critical chemical and
    biological detection work. Programs such as the human genome mapping
    project or chemical spill remediation efforts are also being drawn upon
    to better protect our citizens against the most insidious of attacks.
                            research and development
        The larger part of our research and development program, for which
    we are requesting $221 million in total, is dedicated to other ground
    breaking and vital efforts to improve our national security. Within the
    NN office, our Research and Development activities are working to
    ensure the early detection of proliferation-related activities and to
    improve our ability to verify existing or planned international
    treaties. While I cannot discuss in open session some of our work, we
    are pursuing a number of important avenues which will help detect, with
    increasing reliability, efforts to produce and refine nuclear
    materials, as well as new and better ways to detect and characterize
    nuclear tests and activities contrary to international norms or U.S.
    security interests.
                          declassification initiative
        I would also like to highlight additional areas of work here at
    home. Within our Office of Security Affairs, we continue the critical
    effort to declassify hundreds of millions of pages of archived
    information while ensuring the appropriate protection of classified
    information. The Secretary and my entire Office are committed to
    meeting the goals of the President`s executive order on
    declassification while, at the same time, ensuring that Restricted and
    Formerly Restricted Data are not inadvertently released. Some might see
    these two responsibilities as conflicting, but I do not. They are not
    only compatible, but mutually supportive. Our requirement to remain
    accountable to the American public by avoiding excessive secrecy, while
    at the same time ensuring the vigilant protection of our nation's
    nuclear information are part of the same goal--ensuring the security
    and freedom for the American public, and fulfilling our public trust.
    We must protect the nation from the threat of nuclear terrorism as well
    as the danger of excessive secrecy. Both are critical to meeting our
    obligations as public servants and I am confident in our ability--given
    continued support--to achieve these goals.
                               emergency response
        Even as we prepare to address the risk of attack here at home,
    including our CBW detection efforts and our domestic security work, we
    are constantly preparing for how to respond should an emergency
    develop. The Office of Emergency Response is a critical resource for
    the Department and the United States Government as a whole. This
    extensive communications network and dedicated staff are vital assets,
    and enable the Department's leadership to receive and process updates
    and help manage the response to a large variety of contingencies. These
    include environmental concerns associated with the management of DOE
    sites, to the more extreme cases of attack or sabotage. As with the
    other offices within my responsibility, I have been extremely impressed
    with the professionalism and dedication of the staff within this
    program office. Their efforts help reduce the likelihood of a crisis
    and enable us to reduce the consequences, should one arise. Their
    efforts are generally underappreciated in the eye of the public,
    largely due to their skill and success in their jobs.
                                   conclusion
        I would like to end where I began, and thank the Chairman and the
    entire Committee for their support for the Department and my Office as
    we address the nation's critical national security missions. I look
    forward to our continued work together. Thank you.

                        statement of laura s.h. holgate

        Senator Domenici. Thank you very much, Ms. Gottemoeller.
        Ms. Holgate, will you proceed with your testimony, and your
    prepared remarks will be made a part of the record.
        Ms. Holgate. Thank you, Mr. Chairman, Senator Reid, members
    of the committee. I am pleased to appear before you today to
    discuss the Department of Energy's fiscal year 2000 budget for
    fissile materials disposition.
        The Office of Fissile Materials Disposition's principal
    focus is on disposing of inventories of surplus U.S. weapons--
    usable plutonium, and highly enriched uranium, as well as
    providing technical support for and ultimately implementing
    Administration efforts to obtain reciprocal disposition of
    surplus Russian plutonium.
        These disposition activities, along with other
    administration efforts aimed at dismantling weapons delivery
    systems, securing nuclear materials and preventing the spread
    of nuclear weapons knowledge, are part of the Administration's
    overall strategy to reduce the threat from weapons of mass
    destruction.
        A recent New York Times editorial stated that nothing would
    do more to protect American security in the decades ahead than
    ensuring that Russia's immense stockpile of nuclear weapons and
    materials is diminished. That, members of the committee, is our
    goal.

                        fiscal year 2000 budget request

        The fiscal year 2000 budget request for these activities is
    $200 million, an increase of $32 million over the fiscal year
    1999 comparable amount. The increase in fiscal year 2000 will
    allow the Department to continue detailed design of the pit
    disassembly and conversion facility and the MOX fuel
    fabrication facility, as well as begin design of the
    immobilization and processing facility, key elements of the
    United States hybrid plutonium disposition strategy involving
    immobilization and burning of mixed oxide [MOX] fuel in
    existing, domestic reactors.
        This budget request will also allow the program to continue
    testing the pit disassembly and conversion prototype at the Los
    Alamos National Laboratory, to establish a technical baseline
    for the ceramic immobilization plant process, conduct fuel
    qualification, continue MOX fuel facility license activities,
    initiate a MOX lead test assembly program, and conduct a
    repository analysis associated with disposition technologies.
        The $160 million out of the fiscal year 2000 budget request
    is allocated for these elements, required to dispose of 50 tons
    of excess U.S. plutonium.
        Proceeding with planned design, development, and licensing
    is important, because it strengthens the U.S. negotiating
    position with Russia and sends a strong message that the United
    States is serious about reciprocal plutonium disposition. A
    decision to stop or significantly slow the design effort would
    result in demobilization of the disposition facility design
    teams, loss of continuity, and increased costs.
        The United States, however, will not begin construction of
    new facilities for disposition of U.S. plutonium unless there
    is significant progress on plans for plutonium disposition in
    Russia. This is necessary to avoid putting the United States at
    a strategic disadvantage in future negotiations with Russia as
    well as to avoid large scale expenditure of funds until they
    are required.

                        u.s.-russia plutonium agreement

        With regard to progress with Russia on plutonium
    disposition, important foundations have been laid in the last
    year. In July 1998, Vice President Gore and former Russian
    Prime Minister Kiriyenko signed a Scientific and Technical
    Cooperation Agreement. The agreement provides for conducting
    tests and demonstrations of technologies needed to dispose of
    surplus weapons plutonium in Russia, including plutonium
    conversion and nondestructive assay, burning mixed oxide fuel
    in reactors, and immobilization of waste.
        This work is needed to build trust and cooperation and will
    add to the technical knowledge base, confirm the viability of
    certain technologies, and demonstrate the technologies that
    might be employed for disposition of surplus Russian plutonium.
        The program's fiscal year 2000 budget includes $24.9
    million to implement this agreement and to carry out other
    activities in support of the plutonium disposition in Russia as
    part of the President's Expanded Threat Reduction Initiative.
        At the Moscow summit in September 1998, President Clinton
    and President Yeltsin signed a Joint Statement of Principles.
    This statement committed the two countries to seek to conclude
    a bilateral plutonium disposition agreement as soon as
    possible. This bilateral agreement will specify the
    technological approach and schedules to be followed by each
    country, the types of facilities to be constructed in Russia,
    and commitments with respect to the support of these activities
    in Russia.
        Negotiations on this agreement are underway, and in initial
    conversations with Russian counterparts we feel significant
    commonality of vision on the content, structure, and timing of
    this agreement.
        The United States delegation is led by the Department of
    State, with key negotiation and technical support being
    provided by my office. I believe that an agreement can be
    concluded this year to enable plutonium disposition to proceed
    in both countries.
        Once this agreement is in place, the U.S. and Russia would
    each proceed with parallel programs with comparable rates of
    disposition. In Russia, the program will require the design,
    construction, and operation of facilities to convert weapons
    plutonium metal into oxide powder and to fabricate MOX fuel, as
    well as to modify Russian reactors to permit MOX utilization.
        The estimated annual capacity of existing Russian reactors
    is 2 metric tons of MOX fuel per year. The U.S. goal is to
    increase this rate of disposition in Russia of Russian material
    to no less than 5 metric tons per year, for the expansion of
    the plutonium conversion and MOX fabrication facilities, and
    the identification and utilization of additional reactor
    capacity, whether inside or outside Russia, to consume MOX fuel
    fabricated from plutonium withdrawn from Russian weapons.

             fiscal year 1999 emergency supplemental appropriation

        The Department intends to assist Russia to implement this
    bilateral agreement initially through the emergency
    appropriation of $200 million provided in fiscal year 1999.
    This dramatic gesture has been instrumental in the Russians'
    current cooperative approach in this negotiation. This funding
    will be expended in the Russian Federation over a 2- to 3-year
    period following completion of the agreement.
        A detailed budget justification and obligation plan will be
    submitted to Congress once the strategies are defined as part
    of the negotiations progress. This funding is likely to be
    utilized primarily to begin to create a MOX infrastructure in
    Russia.
        The $200 million will not cover the entire cost of
    implementing this agreement. Russia will need to contribute
    some resources, and the Administration plans to seek support
    for a portion of this program from the international community,
    both the private and public sector. If, however, the program
    requires additional future appropriations, the administration
    will consider such needs in the course of its normal budget
    process.

                gas u.s.-russian reactor technology development

        The fiscal year 1999 Energy and Water Development Act
    provided an earmark of $5 million for joint U.S.-Russian
    development of gas reactor technology called for the Russian
    Federation to provide a matching contribution of $3 million in
    either comparable funds or contributions in-kind. This level of
    funding should be adequate to cover gas reactor technology R&D
    efforts in fiscal years 1999 and 2000.
        In closing, the Fissile Material Disposition Program has
    come a long way in building the domestic and international
    consensus necessary to begin disposing of surplus highly
    enriched uranium and plutonium. Along the way, the program has
    led U.S. efforts not only to identify a hybrid strategy for
    disposing of surplus weapons plutonium, but also to begin
    implementation of this strategy. Technology development, tests,
    and demonstrations are ongoing, and a prototype pit disassembly
    and conversion system successfully began operations at the Los
    Alamos National Laboratory in November.
        DOE is about to announce a major contract award for MOX
    fuel fabrication and irradiation services, and Title I design
    will soon begin for two of the three disposition facilities.
    Negotiations have recently begun with Russia aimed at achieving
    a bilateral agreement for plutonium disposition.
        Now is the time for the United States to continue this
    important mission by sending a clear signal to the world
    community that we are intent on finishing this job. Returning
    to the words of the New York Times editorial, the modest amount
    of money needed to achieve these goals now could save
    Washington many billions of dollars in the future to deal with
    the Russian nuclear threat.
        Thank you.
        [The statement follows:]

                    Prepared Statement of Laura S.H. Holgate

                                  introduction
        Mr. Chairman and members of the Committee, I am pleased to appear
    before you to discuss the Department of Energy's fiscal year 2000
    budget request for Fissile Materials Disposition.
        With the end of the Cold War, hundreds of tons of weapons plutonium
    and highly enriched uranium have become surplus to defense needs in
    both the U.S. and Russia. Continued downsizing of nuclear weapons
    stockpiles and implementation of arms reduction agreements are expected
    to result in further weapons dismantlements and increases in stockpiles
    of surplus weapons materials. Denying a potential proliferator access
    to these materials is the principal barrier to acquiring a nuclear
    weapons capability. Given the current political instability and
    worsening economic conditions prevailing in Russia, there is a very
    real threat that nuclear weapons materials could be stolen or diverted
    into the hands of terrorists or non-nuclear nations. These materials
    could be readily fabricated into crude nuclear weapons for use not only
    against other nations but also in the U.S. against Americans.
        Within the Department of Energy, the Office of Fissile Materials
    Disposition's principal focus is on disposing of inventories of surplus
    U.S. weapons-usable plutonium and highly enriched uranium as well as
    providing technical support for and ultimately implementation of
    Administration efforts to obtain reciprocal disposition of surplus
    Russian plutonium. These disposition activities--along with other
    Administration efforts aimed at dismantling weapons delivery systems,
    securing nuclear materials, and preventing the spread of nuclear
    weapons knowledge--are part of the Administration's strategy to reduce
    the threat from weapons of mass destruction.
        The fiscal year 2000 budget request for these activities is $200
    million, an increase of $32.5 million over the fiscal year 1999
    comparable amount. The increase in fiscal year 2000 is primarily to
    allow the program to begin design of a key U.S. plutonium disposition
    facility to immobilize surplus non-pit plutonium, procure lead test
    assembly equipment required for mixed oxide (MOX) fuel irradiation
    tests, and hire the field staff necessary to oversee plutonium
    disposition facility design activities at the selected DOE site. The
    sections that follow describe the current and planned activities and
    requested funding for the Department's fissile materials disposition
    activities.
                     surplus plutonium disposition summary
        The Program's efforts in fiscal years 1999 and 2000 will focus on
    implementing the Administration's hybrid strategy for plutonium
    disposition. This strategy calls for immobilizing surplus weapons
    plutonium in ceramic surrounded by vitrified high level radioactive
    waste and burning surplus plutonium as mixed oxide fuel in existing,
    domestic commercial reactors. Both approaches render the surplus
    plutonium as inaccessible and unattractive for retrieval and weapons
    use as the plutonium remaining in spent fuel from commercial reactors.
        DOE is pursuing both disposition technologies because they provide
    important insurance against unexpected difficulties with the
    implementation of either technology by itself and they help ensure an
    early start for this important task. This hybrid strategy also provides
    the United States with flexibility and leverage in negotiating with
    Russia and our allies on the critical task of reducing Russian excess
    weapons plutonium. While the proposed immobilization technology would
    be expected to make the weapons plutonium difficult for terrorists or
    third world countries to use in weapons, the Russians have repeatedly
    expressed concern that the U.S. immobilization approach would not
    destroy plutonium and would leave it available for possible re-use in
    weapons, thus reversing the disarmament process. Moreover, there is
    reason to believe that if the U.S. implements only immobilization,
    Russia will continue to store, rather than eliminate, its stockpile of
    surplus weapons plutonium.
        The Program is conducting necessary technology development and
    demonstrations, completing site-specific environmental analyses,
    designing three disposition facilities, and providing key negotiation
    and technical support for efforts to attain a bilateral agreement for
    the disposition of surplus Russian plutonium.
        Proceeding with planned design, development and licensing is
    important because it strengthens the U.S. negotiating position and
    sends a strong message to the Russians that the U.S. is serious about
    reciprocal plutonium disposition. A decision to stop or significantly
    slow the design effort would result in demobilization of the
    disposition facility design teams, loss of continuity and increased
    costs. Since the licensing of the MOX fuel fabrication plant and use of
    MOX fuels in reactors is dependent upon a foundation of design and
    technical analysis, failure to proceed with the resulting technical
    program will significantly lengthen the critical licensing path.
                         pit disassembly and conversion
        The United States has declared 50 metric tons of plutonium as
    surplus to national defense needs. Approximately two-thirds of this
    amount is either in the form of classified nuclear weapons components
    called ``pits'' or clean plutonium metal. Before weapons plutonium from
    pits can be disposed of, it must first be removed from pit form and
    converted to an unclassified oxide form suitable for disposition and
    international inspection. The Department plans to use the Advanced
    Recovery and Integrated Extraction System (ARIES) process, a low-waste,
    modular pyro-chemical process, to convert the pits and plutonium metal
    to plutonium oxide. ARIES is being developed jointly by the Los Alamos
    National Laboratory and the Lawrence Livermore National Laboratory.
    Sandia National Laboratories is developing robotics for the system.
        In November 1998, DOE began operation of an integrated pit
    disassembly and conversion prototype which utilizes the ARIES process
    at DOE's Los Alamos National Laboratory. This demonstration, which
    involves dismantling up to 250 pits over a two to three year period,
    will provide important information for designing and operating a full-
    scale Pit Disassembly and Conversion Facility.
        The fiscal year 2000 budget request seeks funding to continue
    testing of the integrated prototype system at Los Alamos. Funding is
    also being sought to complete Title I & begin Title II design of a
    full-scale Pit Disassembly and Conversion Facility. Contingent on
    significant progress on Russian plans for plutonium disposition, as
    well as successful testing of the prototype, a full-scale facility,
    capable of processing thousands of pits per year, could be operational
    in fiscal year 2005.
                                 immobilization
        Approximately one-third of the 50 tons of surplus U.S. plutonium is
    in the form of impure metal, oxides and reactor fuel which are
    unsuitable for MOX use without extensive purification. To dispose of
    this material, as well as to provide an alternate disposition pathway
    should the MOX/reactor approach prove impossible to implement, the
    Department is focusing on a ``can-in-canister'' approach for
    immobilization. Under this approach, feed materials would be converted
    to oxide which would be mixed with ceramic material to form disks. The
    disks would be stacked and sealed into steel cans which would be
    arrayed within large canisters into which vitrified high-level waste
    would be poured. The radioactive waste barrier increases the
    proliferation resistance of the immobilized plutonium. The can-in-
    canister approach would make use of a high level waste vitrification
    facility such as currently exists at Savannah River or is planned to be
    built at the Hanford Site. Subsequently, the canisters would be
    disposed of in a geologic repository.
        While the United States has experience with immobilizing high level
    wastes, the technological aspects of how to immobilize weapons
    plutonium on an industrial scale need to be resolvedFiscal year 2000
    efforts will be aimed at resolving technological issues associated with
    impurities in the surplus plutonium forms, developing and demonstrating
    production-scale processes and equipment, and conducting the necessary
    verification testing of the preferred can-in-canister approach in order
    to be confident that it can be successful in a timely and cost-
    effective manner.
        The fiscal year 2000 budget request also seeks funding to begin
    Title I design of an Immobilization and Processing Facility. Contingent
    on significant progress on Russian plans for plutonium disposition, as
    well as successful development and refinement of the immobilization
    process, a full-scale facility could be operational in fiscal year
    2006.
             mixed oxide fuel fabrication and irradiation services
        The other half of the hybrid disposition strategy involves
    irradiating MOX fuel in existing, domestic reactors. While MOX fuel is
    used in Western Europe on an industrial scale, the principal
    uncertainty in the U.S. involves the required cost and business
    arrangements. Because the Department doesn't own the reactors needed to
    irradiate the MOX fuel or a MOX fuel fabrication plant, DOE is
    conducting a competitive procurement to acquire the services of an
    industry consortium to design, construct and operate a MOX fuel
    fabrication facility; to irradiate the MOX fuel produced in that
    facility in existing, domestic, commercial reactors; and to deactivate
    the fuel fabrication facility at the end of the disposition mission.
    This approach would maximize private sector participation by teaming
    fuel designers and fabricators, architect & engineering firms,
    construction firms, and reactor operators. Under this arrangement the
    consortium will have full responsibility for construction and operation
    of the fuel fabrication facility as well as modification and operation
    of the reactors in which the fuel will be used.
        The MOX Fuel Fabrication Facility would be designed, constructed,
    and operated by a private sector consortium at an existing DOE site.
    The facility would be government-owned and operated solely for the
    disposition of surplus U.S. plutonium. The government would retain the
    right to terminate operation of the fuel fabrication facility, either
    at the completion of the plutonium disposition mission or earlier, if
    required. The facility will be regulated and licensed by the Nuclear
    Regulatory Commission (NRC). In the case of operating reactors, the
    reactor owners would retain their inherent responsibility for operating
    their reactors safely in accordance with their NRC licenses.
        The procurement was initiated in May 1998. Following analysis of
    three separate proposals, DOE expects to award a contract this month to
    an industrial consortium to start fuel fabrication facility design,
    licensing, reactor analysis, and fuel qualification.
        The fiscal year 2000 budget request will fund process development
    for MOX fuel fabrication, procurement of lead test assembly equipment
    for irradiation tests of the MOX fuel, as well as completion of Title I
    and initiation of Title II design of a MOX Fuel Fabrication Facility.
    Contingent on significant progress on Russian plans for plutonium
    disposition, as well as successful completion of design and licensing
    efforts, a full-scale facility could be operational in fiscal year
    2007.
                         russian plutonium disposition
        The next two to three years will be a crucial period in U.S.
    Russian relations concerning the disposition of surplus weapons
    plutonium. Proceeding with U.S. long lead-time activities leading up to
    construction is necessary to maintain momentum and pressure on Russia
    for a plutonium disposition agreement, and serves as a sign to private
    industry, the public and the world community that the U.S. is serious
    about disposing of stockpiles of surplus weapons plutonium. The United
    States is proceeding with research, design and licensing activities for
    disposing of surplus U.S. plutonium but will not begin construction of
    new facilities for disposition of U.S. plutonium (Pit Disassembly and
    Conversion Facility, Immobilization and Associated Processing Facility,
    and Mixed Oxide Fuel Fabrication Facility) unless there is significant
    progress on plans for plutonium disposition in Russia. Completing
    design is necessary to avoid putting the United States at a strategic
    disadvantage in future negotiations with Russia as well as to avoid the
    large-scale expenditure of funds until necessary.
        At the Moscow Summit in September 1998, President Clinton and
    President Yeltsin signed a Joint Statement of Principles for Management
    and Disposition of Plutonium Designated as No Longer Required for
    Defense Purposes. The Statement committed the two countries to seek to
    conclude a Bilateral Plutonium Disposition Agreement. The Bilateral
    Agreement would specify the technological approach and schedules to be
    followed by each country, the types of facilities to be constructed in
    Russia, and commitments with respect to the financing of these
    activities in Russia.
        Negotiations are underway, and initial conversations with Russian
    counterparts reveal significant commonality of vision on the content,
    structure, and timing of this agreement. The U.S. delegation is led by
    the Department of State with key negotiation and technical support
    being provided by the Department of Energy. The Russian delegation is
    led by the Ministry of Atomic Energy (MINATOM), supported by the
    Ministry of Foreign Affairs. I believe that an agreement can be
    concluded this year to enable plutonium disposition to proceed in both
    countries.
        Once the Agreement is in place, the U.S. and Russia would each
    proceed with parallel programs with comparable, although not
    necessarily identical, rates of disposition. In Russia, this program
    would require the design, construction, and operation of facilities to
    convert weapons plutonium metal into non-weapons form and to fabricate
    MOX fuel, as well as to modify Russian reactors to permit MOX
    utilization. The estimated annual capacity of existing Russian reactors
    (7 VVER-1000 reactors and 1 BN-600 reactor) is two metric tons per
    year. The U.S. goal is to increase this rate of plutonium disposition
    in Russia to five metric tons per year through the expansion of the
    plutonium conversion and MOX fabrication facilities and the
    identification and utilization of additional reactor capacity (whether
    inside or outside Russia) to consume MOX fuel fabricated from plutonium
    withdrawn from Russian weapons.
        The Department intends to assist Russia to implement this Bilateral
    Agreement initially through the emergency appropriation of $200 million
    provided in fiscal year 1999. This funding will be expended in the
    Russian Federation over a two- to three-year period following
    completion of the United States/Russian agreement. A detailed budget
    justification and obligation plan will be submitted to Congress once
    strategies are defined as negotiations progress. Although the United
    States and Russia have not yet agreed on rates, techniques, or
    facilities for plutonium disposition, this funding will likely be
    utilized to begin to create a MOX infrastructure in Russia. The $200
    million will not cover the entire cost of implementing the agreement.
    Russia will need to contribute some resources, and the Administration
    plans to seek financing for a portion of this program from the
    international community, both the private and public sectors. If,
    however, the program requires future appropriations, the Administration
    will consider such needs in the course of its normal budget process.
                                work with russia
        In July 1998, Vice President Gore and the former Russian Prime
    Minister Kiriyenko signed a Scientific and Technical Cooperation
    Agreement. The Agreement provides for conducting tests and
    demonstrations (up to and including pilot-scale tests and
    demonstrations) of technologies needed to dispose of surplus weapons
    plutonium including plutonium conversion and nondestructive assay,
    burning mixed oxide (MOX) fuel in reactors, and immobilization. This
    work is needed to build trust and cooperation and will add to the
    technical knowledge base, confirm the viability of certain
    technologies, and demonstrate the technologies that might be employed
    for disposition of surplus Russian plutonium.
        The fiscal year 1999 Energy and Water Development Appropriation
    earmark of $5 million for joint U.S.-Russian development of gas reactor
    technology called for the Russian Federation to provide a matching
    contribution of $3 million in either comparable funds or contributions-
    in-kind. This level of funding should be adequate to cover gas reactor
    technology research and development efforts in the fiscal year 1999-
    2000 timeframe.
        The portion of the fiscal year 2000 budget to be allocated towards
    cooperation with Russia is $24.9 million. This funding will allow the
    Department to continue a series of collaborative disposition efforts
    which include analyses and small-scale tests and demonstrations of
    plutonium disposition technologies, and fund efforts in the United
    States to implement a United States/Russian accord for disposition of
    excess weapons plutonium in Russia. These activities are part of the
    President's Expanded Threat Reduction Initiative.
          budget request summary for plutonium disposition activities
        In summary, the portion of the fiscal year 2000 budget to be
    allocated towards plutonium disposition activities (pit disassembly and
    conversion; immobilization; MOX fuel fabrication and irradiation
    services; and work with Russia) is $177.0 million. This funding will
    allow the Department to continue detailed design of the Pit Disassembly
    and Conversion Facility and the MOX Fuel Fabrication Facility; begin
    design of the Immobilization and Processing Facility; continue testing
    of the pit disassembly and conversion prototype; establish the
    technical baseline for ceramic immobilization plant process; conduct
    fuel qualification, continue MOX fuel facility licensing activities,
    initiate a MOX lead test assembly program; and conduct repository
    analyses associated with disposition technologies. The fiscal year 2000
    budget for U.S. plutonium disposition activities represents an increase
    of $22.3 million over fiscal year 1999. This increase is due to the
    start of Title I design for the Immobilization and Processing Facility
    ($21.8 million), and Title II design for the Pit Disassembly and
    Conversion Facility ($8.7 million), procurement of lead test equipment
    for the MOX fuel approach ($7.5 million). This increase is partially
    offset by decreases in MOX Fuel Fabrication Facility design and other
    activities (-$15.7 million).
                      highly enriched uranium disposition
        In fiscal year 1999 and fiscal year 2000, the program will continue
    to focus on implementing the Department's July 1996 Record of Decision
    to disposition as much as possible of the surplus highly enriched
    uranium (HEU) by down-blending it with other uranium to make low
    enriched uranium which is commercially usable as power reactor fuel.
    This approach advances U.S. nonproliferation goals, reduces storage and
    security costs, and provides revenues to the Treasury from the
    commercial sale of these surplus assets over time. The remaining
    surplus HEU, originally determined to be unsuitable for commercial use,
    is to be down-blended and disposed of as waste.
        To date, about 174 metric tons (MT) of HEU have been declared
    excess to national security needs. Because of the various forms of HEU
    and the availability dates from weapons dismantlement and site cleanup
    operations, down blending will take place over an extended period of
    time. Title to 63 MT of HEU has been transferred to the United States
    Enrichment Corporation (USEC). Thirteen MT was transferred to USEC and
    has been down-blended pursuant to the Energy Policy Act of 1992. An
    additional 50 MT is being shipped over the next six years (4 MT to
    date) pursuant to the USEC Privatization Act. An additional 33-40 MT of
    off-specification HEU material, not saleable on the open market, is
    expected to be transferred to the Tennessee Valley Authority (TVA) for
    use in its reactors over the period between 2001 and 2006. DOE is
    preparing plans for disposition of the remaining surplus HEU.
        The portion of the fiscal year 2000 budget for surplus uranium
    disposition activities is $5.8 million. This funding will allow the
    Department to facilitate and implement disposition of surplus highly
    enriched uranium, including off-specification HEU.
                        surplus fissile material storage
        In January 1997, the Department issued a Record of Decision
    regarding the storage of all weapons-usable fissile materials and the
    disposition of surplus plutonium. The Department will reduce the number
    of sites where plutonium is stored through a combination of storage and
    disposition alternatives. Under this decision, DOE began shipping
    surplus plutonium pits from Rocky Flats to Pantex in April 1997 and
    will complete the shipments in fiscal year 1999. Stabilized and
    separated non-pit plutonium from Rocky Flats will be moved to Savannah
    River (after certain conditions are met). Storage of surplus plutonium
    at other sites will continue, pending disposition. Highly enriched
    uranium will continue to be consolidated and stored at the Oak Ridge Y-
    12 Plant, pending disposition.
        In August 1998, the Department issued an amended Record of Decision
    to remove all surplus non-pit plutonium from Rocky Flats by 2002, in
    accordance with the Department's June 1998 Accelerated Closure Pilot
    Project that calls for closing the site by 2006. The plan calls for the
    Department to transfer surplus non-pit plutonium from Rocky Flats to
    Savannah River for storage in a modified Building 105-K.
        The portion of the fiscal year 2000 budget to be allocated towards
    storage of surplus fissile materials is $4.3 million. This funding will
    allow the Department to begin operation of an upgraded storage area for
    surplus plutonium pits at Pantex. The increase of $3.4 million from
    fiscal year 1999 reflects a shift in Program emphasis from analysis of
    storage and transportation issues required during the construction
    phase to operation of the upgraded area. Design and construction of
    upgrades for surplus pit materials will be funded from fiscal year 1997
    carryover balances.
                     core technologies and nepa compliance
        The Department is currently preparing an Environmental Impact
    Statement to help determine the site(s) where surplus weapons plutonium
    disposition activities will take place. Four sites (Hanford, Idaho
    National Engineering and Environmental Laboratory, Pantex and Savannah
    River) are being considered for constructing and operating key
    disposition facilities.
        On December 22, 1998, Secretary Richardson selected the Savannah
    River Site as the preferred site for building and operating the Pit
    Disassembly and Conversion Facility. Savannah River was selected
    because the site has extensive experience with plutonium processing. In
    addition, locating the pit disassembly facility with other existing and
    planned facilities at the site might provide some savings in
    infrastructure.
        Previously, the Department named Savannah River as the preferred
    site for two other key disposition facilities--the Mixed Oxide (MOX)
    Fuel Fabrication Facility and the Immobilization and Processing
    Facility. Subsequent to the release of the Environmental Impact
    Statement later this year, final site selection will be made in the
    Record of Decision to follow shortly thereafter.
        The portion of the fiscal year 2000 budget for Core Technologies
    and NEPA is $5.6 million. This funding will provide crosscutting
    technologies and program integration activities.
                               program direction
        Program Direction provides the overall management, oversight,
    staffing, and administrative support necessary to carry out the Fissile
    Materials Disposition Program. The portion of the fiscal year 2000
    budget for Program Direction is $7.3 million and represents an increase
    of $2.7 million over fiscal year 1999. This increase is for seven
    additional full-time equivalents (FTEs) over the fiscal year 1999 FTE
    level for field oversight and project management for the design of
    three plutonium disposition facilities. The increase also includes
    funding for FTEs funded with prior year balances in fiscal year 1999
    and movement of support service activities into Program Direction from
    Core Technologies and NEPA in accordance with Congressional direction.
    The $7.3 million level for Program Direction continues to represent a
    modest 3.7 percent of the total Fissile Materials Disposition Program
    budget request.
                                   conclusion
        This Fissile Materials Disposition Program has come a long way in
    building the domestic and international consensus necessary to begin
    disposing of surplus highly enriched uranium and plutonium. Along the
    way, the Program has led U.S. efforts not only to identify a hybrid
    strategy for disposing of surplus weapons plutonium, but also to begin
    implementation of this hybrid strategy. Technology process development,
    tests, and demonstrations are ongoing and a prototype pit disassembly
    and conversion system successfully began operations at the Los Alamos
    National Laboratory in November. DOE is about to announce a major
    contract award for MOX fuel fabrication and irradiation services and
    Title I design will soon begin for two of the three disposition
    facilities. Negotiations have recently begun with Russia aimed at
    achieving a bilateral agreement for plutonium disposition. Now is the
    time for the United States to continue this important mission by
    sending a clear signal to the world community that we are intent on
    finishing the job. It is an investment in our future well worth making.

                        surplus nuclear materials threat

        Senator Domenici. We are going to proceed with questions,
    and if any Senator has a time schedule I would yield to them.
        Ms. Holgate, I would like to hear you when I ask questions
    be able to explain this threat related to surplus nuclear
    materials, and what we are doing without having to quote the
    New York Times, so would you be thinking about that?
        Ms. Holgate. Certainly, sir.
        Senator Domenici. I would appreciate it. Not that they
    should not be quoted, but I would think you ought to have some
    other sources beyond the New York Times as to the importance of
    this program.

                   stockpile safety reliability, and security

        I suggest that we go one round quickly. Dr. Reis, for the
    record, is the nuclear weapons stockpile safe, reliable, and
    secure?
        Dr. Reis. Yes, it is, Senator.
        Senator Domenici. Do you have confidence that the weapons
    in the stockpile can and will perform as designed?
        Dr. Reis. Yes, I do.
        Senator Domenici. Do you have concurrence in those
    conclusions from the laboratory directors at the three nuclear
    laboratories?
        Dr. Reis. Yes, we do, Senator. We sent a letter to the
    President, and I assume he will send the letter and the
    materials along with that up to Congress very, very shortly
    indicating just those facts, including not just the laboratory
    directors, but the Commander-in-Chief of the United States
    Strategic Command as well.

                     critical needs not addressed in budget

        Senator Domenici. Are there any critical needs with
    reference to the Stockpile Stewardship program, that program
    upon which we predicate the safety and reliability and security
    of the weapons, not addressed in the budget because of a lack
    of budgetary resources?
        Dr. Reis. We feel the budget is responsibly addressing the
    stockpile right now, sir.
        Senator Domenici. If the defense side of this budget were
    to be cut substantially, could that change the answer to the
    three questions you have just given?
        Dr. Reis. It certainly could.
        Senator Domenici. Will you be prepared during the budget
    and appropriation process to respond in that regard?
        Dr. Reis. I would be glad to do so.

                  chiles commission report and recommendations

        Senator Domenici. The Chiles Commission report for just a
    moment, we will move to it first. Are you familiar with the
    report and, if so, can you review briefly the findings and
    recommendations?
        Dr. Reis. Yes, sir. I have a copy of the report right here,
    and we have been through those recommendations with Admiral
    Chiles, who briefed myself, Under Secretary Moniz, and the
    Secretary.
        They listed basically some 12 recommendations. I will not
    go through all of them now. In the briefing that they gave to
    the Secretary----
        Senator Domenici. Just generally tell us, what they were
    concerned about?
        Dr. Reis. This was--as you recall, a congressionally
    mandated commission that was to look at the personnel policies,
    will we have enough people in the long term to support the
    Stockpile Stewardship program. It was specifically oriented
    toward the people, the personnel policies, and the level of
    expertise at the laboratories, at the plants, and in the
    Federal structure.
        What they discovered was, and we concur that we have some
    considerable amount of work to do. All is not well at any of
    those facilities, we have got some plans in place, but it is
    important to move aggressively to ensure that we have those
    people in the future when the time comes.

                 balance of production plants and labs funding

        Senator Domenici. Let me move now to two different
    budgetary percentages, first the budget request, about 7.5
    percent increase in the stockpile stewardship. At the same
    time, it includes a 4-percent reduction of stockpile
    management. Does this cause any problems in carrying out the
    program with the labs and the production plants?
        Dr. Reis. Senator, every year we have to go through and
    balance very carefully the plants and the laboratories and that
    is not an easy judgment to make. People can differ in terms of
    those numbers, but we believe those are the best numbers right
    now.

                         nuclear power plants in russia

        Senator Domenici. I will save this series of questions for
    you until after the other Senators have inquired. I will just
    ask one question each of the other two witnesses.
        Ms. Gottemoeller, could you tell me how many nuclear power
    plants in Russia are of the type and model at Chernobyl?
        Ms. Gottemoeller. The Chernobyl style reactors are RBMK
    reactors, sir. I do not have that exact number at my finger
    tips, so I will have to provide that for the record.
        Senator Domenici. Are there some?
        Ms. Gottemoeller. Absolutely, sir, yes.
        [The information follows:]

                                 RBMK Reactors

        There are currently 14 operational RBMK reactors. This includes 11
    in Russia, 2 in Lithuania and the 1 remaining operational Chernobyl
    unit in Ukraine.

                     y2k impact on chernobyl-type reactors

        Senator Domenici. Might I just ask, we are helping to make
    these reactors safer, and working with them on technological
    advances and improvements. But I read with some concern that
    Y2K may have a very big impact on Chernobyl-type reactors. Are
    we aware of that, and is that any of our concern at this point?
        Ms. Gottemoeller. Sir, we have actually had a very
    productive seminar in cooperation with the IAEA, the
    International Atomic Energy Agency in Vienna. We have also had
    two workshops in Moscow. We have gone to Moscow and sat down
    with the power plant industry and, in fact, there are some
    considerable concerns, many of which are associated with the
    stability of the power grid serving the reactors.
        There is quite a bit of concern that should there be a Y2K
    problem with regard to the electricity flow into the power
    reactors, the RBMK types as well as the other types, that it
    could lead to a serious accident, and so that has been a
    concern to us, and we have proposed to the Congress a
    reprogramming request to work quickly with the Russians on some
    programs to lay out the steps that they have to take within the
    next 9 months in order to resolve these problems. We think that
    they can be resolved, but they need to pay some attention to
    them.
        Senator Domenici. Now, we granted your reprogramming, but
    the House has denied it twice. What was the reason for denying
    the Y2K programming?
        Ms. Gottemoeller. My understanding, sir, is that there was
    a concern with regard to a hardware request. That is, we had
    hoped to perhaps supply some emergency generators for the power
    plants in case there should be a power failure of the kind I
    described a few moments ago.
        As a matter of fact, we have been able to respond to their
    concerns by really refocusing our request on the very important
    prioritization planning work that has to be done. In other
    words, we have removed the request for hardware from the
    reprogramming request, and we hope that that will deal with the
    concerns that have been expressed by the House.
        Senator Domenici. I misstated. We had not granted the
    reprogramming, but they denied it before we had a chance. We
    are prepared to, but all we got was a denial from the other
    body. We will work with you when you are ready on our side.
        Ms. Gottemoeller. Thank you very much.

                        u.s.-russian plutonium agreement

        Senator Domenici. One question now of Ms. Holgate. This
    $200 million that we have provided, set aside for
    implementation of the U.S.-Russian plutonium agreement, why
    isn't this just foreign aid to Russia that we are throwing down
    a rat hole, helping the Russians with their nuclear development
    by giving them money? How do you explain that?
        Ms. Holgate. Well, first of all, sir, let me thank you
    personally for your role in providing that additional funding.
        Senator Domenici. Obviously, I do not believe what I just
    said.
        Ms. Holgate. I understand. Nor do I, sir. One of the key
    reasons that it is not simply throwing money down a rat hole,
    is that it is in pursuit, specifically, of U.S. national
    security interests.
        The other reason is that the Department does not intend to
    implement that funding through writing a check to Boris Yeltsin
    or Minister Adamov. It will be implemented through a series of
    contracts, most likely with U.S. contractors, in achieving
    deliverables and providing goods and services in Russia in an
    auditable, reliable fashion. As we work out the details of what
    needs to be done in Russia, we will be coming to you with a
    detailed budget proposal on how we will do that.
        The achievements of the work that will be accomplished with
    those funds contributes directly to our national security
    interests by reducing the threat associated with these
    materials. Russia, as you know, is one of the most likely
    sources of loose nuclear material, given the enormous volume
    that they have there, and access to the material is really the
    final barrier to the development of a rogue nation with nuclear
    capabilities.
        Senator Domenici. Without divulging anything that is
    classified, how many bombs could this plutonium that we are
    going to dispose of that is Russian, how many bombs could it be
    used to make if it is not disposed of?
        Ms. Holgate. Tens of thousands, sir.
        Senator Domenici. So the starting point for your answer is,
    this will eliminate the potential for 10,000 or more Soviet
    nuclear weapons to use this plutonium as a part of their
    fabrication, correct?
        Ms. Holgate. Yes, sir.
        Senator Domenici. Senator Reid.

                             stockpile y2k concerns

        Senator Reid. Thank you, Mr. Chairman.
        Now, Dr. Reis, Senator Domenici asked Ms. Gottemoeller
    about Y2K, and we have here a report from GAO that just came
    out, and in this they say among other things resolving the year
    2000 computing problem is the most pervasive time-critical risk
    facing Government today. Unless adequate actions are taken, key
    Federal operations, national defense it mentions could be
    seriously disrupted.
        Tell us how you look at this Y2K, with all the many
    sensitive programs over which this subcommittee and you have
    jurisdiction.
        Dr. Reis. Senator, we take Y2K very, very seriously. We
    have looked in detail at all the weapons themselves, all of the
    support systems, and the certification process. We provided the
    appropriate oversight to ensure the work is correct. All of
    those systems, all of the strategic systems are, in fact, Y2K-
    compliant--the weapons themselves and the support systems. The
    last time I looked at this there was only one, if you will,
    mission critical system that had not been certified. This is a
    pay system, and a badging system at Sandia.
        It is certainly critical to people at Sandia that they get
    paid properly, but we are literally working basically at that
    level. Not only have we reviewed it, but we gave that review to
    the Nuclear Weapons Council. The Strategic Command has also
    reviewed their systems, so we are quite confident from a Y2K
    perspective that the strategic forces and their supporting
    systems that we have to deal with are compliant with Y2K.

                        explosive testing contamination

        Senator Reid. Your written and oral testimony refers to a
    combination of experiments and computer simulations to
    demonstrate safety and reliability in our stockpile. Many of
    the experiments require violent explosions involving nuclear
    materials. I understand that explosive testing has resulted in
    some contamination of certain areas at the laboratories. Would
    you describe this contamination?
        Dr. Reis. Senator, I will have to get back to you on the
    details on that for the record.
        [The information follows:]

                 Contamination Resulting From Explosive Testing

        Explosive testing at the Los Alamos and Lawrence Livermore National
    Laboratories has resulted in the release of depleted uranium,
    beryllium, lead and copper into the immediate vicinity of the test
    location. The air, surface water, groundwater and soil at the sites are
    regularly monitored by the laboratories and reported to State and
    Federal agencies; sample concentrations for these contaminants remain
    below applicable Federal, State, and DOE standards for all
    environmental media.
        In addition, as a result of explosive testing at the Lawrence
    Livermore National Laboratory experimental test site, in a remote area
    some 40 miles from the laboratory and population centers, tritium
    contamination of on-site groundwater exceeds Federal drinking water
    standards. Wells have been established between the contaminated areas
    and the site boundary to monitor tritium migration to ensure protection
    of the water supply. The measured migration data, along with the local
    geological structure known to exist and the inherent radioactive decay
    rate of tritium, are used to project contamination levels at the site
    boundary. There has never been, nor is there projected to be, a tritium
    contamination level at the site boundary that approaches the Federal
    drinking water standard. Water supplies are anticipated to remain
    unharmed.

                           maintaining test readiness

        Senator Reid. You are going to continue these very
    important experiments, is that not true?
        Dr. Reis. That is correct.
        Senator Reid. How do you intend to demonstrate our
    continuing ability to resume testing?
        Dr. Reis. Senator, we have looked at the Test Site, a
    number of areas, a number of activities that will maintain that
    capability. I think the one most vital is the continued and
    very aggressive series of subcritical experiments that we are
    working with plutonium and high explosive.
        On those tests, of course, we do not have a nuclear
    explosion, but from a safety perspective, from procedures
    perspective, you go through many of the same things that one
    would do on a full scale nuclear test. We are maintaining the
    diagnostics facilities as well.
        One of the things I was specifically concerned about, just
    for that question, is we have asked the Department of Defense
    this year to review our test readiness programs to give us an
    independent look at just how well we are doing on those. We
    feel comfortable, but we would like to have a broader look at
    that, and they will be looking at that specific area in detail
    over the next year.

                      attract and maintain skilled workers

        Senator Reid. You refer to the task, and in my opening
    statement I talked about the Chiles Commission, and Senator
    Domenici talked about the Chiles Commission, and their report
    is that the skills at the Nevada Test Site are in serious
    jeopardy because the workforce there is nearing retirement, and
    similar problems at the weapons labs to make sure that we
    attract and maintain the highest caliber of scientist, which we
    have had for the last 40-plus years.
        What is your plan to attract and retain the skills
    necessary to maintain these capabilities at the laboratories
    and the Nevada Test Site?
        Dr. Reis. The Chiles Commission also made some significant
    recommendations on how to do that, and again, I concur with
    those recommendations. They start off by suggesting that both
    the Administration and Congress must maintain a national
    commitment.
        The type of people who go to work at the Test Site, who go
    to work at the laboratories, who go to work at these plants,
    these are not people who are necessarily interested in just
    making a buck for their day. They are really interested in
    supporting their country's efforts. They are interested in
    working on technical challenges, and that means that we have to
    demonstrate to them that we have that commitment, and we have
    the budgets, and we have the support that continue to go along
    with that over time.
        So the first thing is to again maintain that commitment,
    and part of that, if you will, is to say that we support the
    programs that basically make that happen.
        They are also attracted not just by the challenge of the
    job, but by the ability of having the facilities available to
    work on, and that also means that we have to support those. We
    have to support the facilities themselves.
        In addition to which, certainly for the laboratories, and
    again for many of the other establishments is, we have to make
    the connections. Through the alliance program and through other
    things within the universities we get those people in the
    universities familiar with what we are doing, working on
    similar programs, so one could recruit the right sorts of
    people. Some of those programs are in place and are working
    very, very well.
        I think what the commission said, we ought to be doing more
    of that, and I certainly concur that we will have to be doing
    more of that.
        Senator Reid. Spread throughout the laboratories and the
    Nevada Test Site, there are some of the finest scientists in
    the world, Ph.D's in all kinds of scientific backgrounds. That
    is what we are talking about, maintaining these people in our
    defense capabilities, as compared to them going off and working
    in the private sector some place, is that not right?
        Dr. Reis. That is correct.

                       nuclear emergency response program

        Senator Reid. The nuclear emergency response program has
    undergone major revisions over the past few years. I continue
    to hear concerns that these changes may have diminished our
    response capabilities. These concerns need to be specifically
    and effectively allayed. How does the Department organize its
    lines of responsibility and funding for the emergency response
    program and, second, do you think this is the right
    organizational structure?
        Dr. Reis. I believe we have a very good organizational
    structure right now. I believe the nuclear emergency support
    teams that we support within the Defense Programs continues to
    get high marks. I believe in terms of their ability to respond
    to emergencies it is integrated with the emergency response,
    the communications, the day-to-day emergency response work that
    Ms. Gottemoeller discussed.
        These are always complex issues in terms of how one
    organizes it, because the broader emergency response of the
    Department has to do with a lot more than just the nuclear
    responses. As well, there is chemical, biological responses.
    There is just all sorts of different types of things which, as
    Ms. Gottemoeller said, they are duty 365 days a year, 24 hours
    a day.
        I think the specifics of the nuclear emergency response
    teams that we are dealing with is embedded within that overall
    organizational structure.

                         emergency response capability

        Senator Reid. Do you think we need to undertake a study to
    establish our ability to respond to the variety of emergency
    situations that could occur, or do you think we are okay as is?
        Dr. Reis. Do you want to try on that one?
        Ms. Gottemoeller. Sir, with regard to the emergency
    response capability in the Department, it is quite broad-
    ranging. I agree with Dr. Reis on that.
        The complex is a very complicated structure with many
    different kinds of missions being undertaken, clearly, and it
    is, I think, very important to ensure that whatever approach we
    take to the organization of emergency response that it be
    highly integrated throughout the Department, and that the major
    operational programs, Defense Programs and our other major
    operational programs be intimately involved in the
    implementation of emergency response.
        So I think that there is room for improvement in the way
    emergency response is organized in the Department. I speak with
    my hat on as the person responsible, as I said earlier, for
    overall emergency management in the Department. I think it is
    worth a look, but I would like to underscore very firmly that
    emergency response, wherever and however the necessity for it
    arises, must be very, very well-integrated with the other
    programs.

                    initiatives for proliferation prevention

        Senator Reid. As I indicated when I was complimenting Dr.
    Reis, you also have a knowledge of Russian language, is that
    true?
        Ms. Gottemoeller. Yes, sir.
        Senator Reid. I think that is worth a comment. That is one
    of your main responsibilities, and I am sure it makes it a lot
    easier with your having the Russian language capabilities, and
    I am sure that is an understatement.
        One last line of questioning, Mr. Chairman, then I will
    stop.
        In your opinion, how effectively can you prevent our
    proliferation and prevention vessels from delivering dual use
    benefits to the Russian military programs?
        Ms. Gottemoeller. Sir, this is an issue which we take
    extremely seriously inside the initiatives for proliferation
    prevention program and, in fact, since 1997, when a new
    management team took over the IPP program, we have redoubled
    our efforts to ensure that project proposals that come in do
    not have a dual use aspect to them. They are reviewed by
    multiple layers in the interagency, including the intelligence
    community here in Washington. They are reviewed by our
    scientists at the labs, who are also tied into the overall
    interagency governmental review process.
        We are extraordinarily serious about this aspect. We want
    to ensure that the work that is done is valuable in its
    scientific importance but also, of course, keeps scientists at
    work at their lab benches and not wandering off to Iran or
    North Korea, but equally important is the necessity that these
    projects and this program do not serve the development of
    military capability on the Russian side.

                               nuclear smuggling

        Senator Reid. I applaud your efforts to interdict nuclear
    smuggling at important border crossings, but I have to
    acknowledge that we have not been very successful as a country
    in preventing illegal entry into the United States, and so I am
    really a little concerned about what efforts, based on how
    unsuccessful we have been, what efforts have the Russians
    mounted to provide border security against the smuggling of
    nuclear materials at points other than formal border crossings
    and at formal border crossings?
        Ms. Gottemoeller. I will say a few words to begin with,
    Senator, about our second line of defense program.
        Our material protection control and our accounting program
    is the first line of defense, and I would like to underscore
    that that is I think really the first way that we prevent
    smuggling of nuclear materials by ensuring that the facilities
    themselves are under the best possible safety and security,
    that we have good fences, that we have effective guard forces
    and good locks on the doors. That is the first way that we
    prevent nuclear smuggling from taking place.
        We have also, through a very effective working relationship
    with the Russian customs service, just in the last year begun
    our second line of defense program where we work with the
    Russian customs service to put up nuclear detection devices at
    the most vulnerable and high volume border crossing points.
        Senator Domenici was with us this past summer when we
    opened up the first of such border crossing protection points
    at Sheryemetyevo-1 Airport. They are extremely, I think,
    effective where they operate. They are at very high intensity
    sites. For example, the other point we opened up this summer
    was at Astrakhan seaport on the Caspian Sea, where there is a
    very high level of shipping traffic to Iran, so we are choosing
    very high priority places to put these nuclear detection
    devices, in addition to which, though, we have found that we
    have to layer basically these programs, and there are programs
    across the U.S. Government.
        I do not want to say that the DOE is doing all the work in
    that regard. For example, there is a great deal of work that
    the Department of Defense is doing in working with the non-
    Russian Newly Independent States in order to improve their
    border patrols and border controls overall, and so we work very
    closely and pay attention to integrating the work that we do
    with the work in other U.S. Government agencies and in other
    agencies of the Russian Government as well.
        Senator Reid. Thank you, Mr. Chairman.
        Senator Domenici. Thank you. Senator Reid, I failed to
    mention in response to your opening remarks, when you spoke of
    the extreme age of the scientists at the test site, and some of
    your other thoughts with reference to maintaining it, that I am
    going to work with you to see what we can do, and talk
    generally about it. We are now looking with your staff and with
    others at some specific things.
        Senator Craig.
        Senator Craig. Thank you very much, Mr. Chairman, and
    panelists, we appreciate your being here this morning. I will
    make a brief comment before I ask questions specific to the
    interest in my State at the INEEL and Argonne Laboratory West,
    because oftentimes when you think of them, I will tell you that
    DOE weapons and defense labs do not necessarily jump to your
    mind compared to New Mexico and Nevada and other places.
        We have had a proud history at the site dealing with the
    country's naval nuclear propulsion program, and Idaho and the
    Navy have effectively and safely managed Navy spent fuel for
    decades.
        Unfortunately, as we know, in Russia naval fuel has not
    been managed as carefully. The Defense Department's cooperative
    threat reduction program is beginning to address Russia's spent
    naval fuel. The INEEL and Argonne West have the experience to
    provide valuable technical assistance on this problem, and I
    would like to see a commitment from all of you to bring DOE's
    experiences into the project rather than to have DOD reinvent
    the wheel.
        We are all squeezing budgets at this time and squeezing
    them hard, and my guess is there is a wealth of experience and
    knowledge already out there that could be of great assistance,
    as an example, and we mentioned the Caspian Sea just a moment
    ago, and the shipping traffic there.
        As an example of this experience base, Argonne West is
    working in Kazakhstan on storage of spent nuclear fuel at a
    breeder reactor on the shores of the Caspian Sea. The
    Kazakhstan Government has decided to shut the reactor down
    permanently, but some safety upgrades will be required first to
    fire protection systems, et cetera. Argonne has experienced
    people and a proven track record in Kazakhstan to see that this
    work is done quickly and efficiently.
        Another issue we need to address is the continued
    production of plutonium in Russia at its BN-600 fast breeder
    reactor. Some people may not realize that at the same time we
    are trying to enter into agreements with Russia to dispose of
    its surplus stocks of plutonium, Russia is continuing to make
    plutonium.
        Argonne West again has the experience to convert fast
    breeder reactors, because they did it in EBR-2 in Idaho. We
    need to use this expertise that we already have at our national
    labs to assist the Russians, who face similar problems.
        The budget for nuclear energy work at Argonne is cut by $20
    million in the President's request, and that would mean the
    laying off of about 250 workers. It really does not make sense
    to me that we lay off skilled workforce when their skills could
    be applied to pressing global nuclear safety issues, so it is
    with that in mind, Mr. Chairman that I will only ask a couple
    of questions, and then I will come back for more so that we can
    share equitably in this time.

                          environmental surety program

        Dr. Reis, as DOE facilities are retired from use and become
    part of DOE's cleanup program, I think it is important that we
    leave the facilities in a condition which minimizes the amount
    of waste we will have to clean up later. The INEEL has been
    assisting the defense sites in meeting this challenge for the
    last 2 years through the defense environmental surety program.
        By all accounts, and from letters of endorsement received
    from defense production sites, DOE's environmental surety
    program was a very successful and cost-effective program. My
    question to you, why was this program zeroed out in the fiscal
    year 2000 budget?
        Dr. Reis. Senator Craig, while we did zero it out from a
    headquarters perspective effective with the implementation of
    the fiscal year 1999 budget, what we have done is turned the
    responsibility over to the folks at the Los Alamos National
    Laboratory. I agree with you that it has been a successful and
    cost-effective program, but on any budget you basically have to
    make decisions. If the folks who are on the ground who have to
    do that environmental cleanup, which are the people at Los
    Alamos, feel that it continues to be a successful program, I
    have no doubt that it will continue to get funded.
        Senator Craig. But it is not in the budget now.
        Dr. Reis. It is not in the budget right now, that is
    correct.
        Senator Craig. So for fiscal year 2000, if the President's
    budget came into place, we would assume this program would not
    exist.
        Dr. Reis. No, I do not think that is true at all. If the
    folks at Los Alamos, who again are the people on the ground,
    decide this still is the best way to handle the job, it will
    get funded.
        Senator Craig. Do we know the status of that at this
    moment?
        Dr. Reis. We are still working on that, Senator Craig.

                          environmental safety center

        Senator Craig. Well, we will still work on it with you,
    then.
        Ms. Gottemoeller, at your confirmation hearing last fall
    you talked about DOE's plans to establish the joint U.S.-
    Russian international center for environmental safety to work
    on international nuclear cleanup issues. Some of this work was
    to be administered by the INEEL and Argonne West. Can you tell
    us where DOE is with respect to getting a signed agreement with
    the Russians and initiating this program?
        Ms. Gottemoeller. Yes, sir. I am actually very happy to be
    able to report progress to you since we last spoke on this
    matter last fall. The establishment of the Environmental Safety
    Center will be a centerpiece of the upcoming Gore-Primakov
    Commission meeting in 2 weeks time, and the statement
    establishing the center we actually expect to be signed by the
    Vice President and the prime minister, so it is a go, sir.
        Senator Craig. Excellent. Congratulations.
        Ms. Gottemoeller. Thank you, sir. We are looking forward to
    having INEEL closely involved in it.

                         russian naval fuel assistance

        Senator Craig. My next question in on Russian naval fuel
    assistance, and this may be for any witness here. Much of
    Russia's naval spent fuel is sitting in their idled submarines,
    we are told, and they do not really have the resources to deal
    with it.
        In Idaho, the Navy has been safely managing U.S. naval
    spent fuel for decades, as we all know. Idaho's personnel have
    a lot of experience on this issue. Would any of the witnesses
    care to respond with ways we might more cooperatively work on
    the Russian submarine fuel issue to get it into a safer storage
    condition?
        Ms. Gottemoeller. Senator, if I may take a crack at that,
    we at DOE already have a very fast-moving material protection
    control and accounting program to deal with fresh fuel from the
    Russian submarine program, and that is in both the northern
    fleet area and the Far East.
        It has been very fast-moving. The Russian Navy has really
    put a number of intense schedules on us, because particularly
    in the far north, of course, we have a very short construction
    period to work with, but we have been able to work very quickly
    to get that fresh fuel under better, safer, and more secure
    conditions.
        We are currently on both the U.S. interagency basis and in
    discussions with the Russians considering how to move on to the
    broader range of problems that you address. DOD already has its
    successful efforts underway under the cooperative threat
    reduction program to dispose of the Russian strategic strike
    submarines, the SSBN's, and now we are considering what steps
    we should take and what priorities we should set in dealing
    with the broader question of naval spent fuel and submarine
    disposition.
        So this, too, will be a subject for the Gore-Primakov
    Commission meeting coming up in several weeks time, but I
    wanted to assure you that not only are we engaged very actively
    in interagency discussions on this, but also we are beginning
    to engage with the Russians on this.
        Senator Craig. So you mentioned a type of submarine. I
    assume that will be decommissioned and ultimately cut up, and
    therefore those are some of the subs that have that spent fuel
    in them. You will obviously have to deal with the fuel at that
    time.
        Ms. Gottemoeller. Exactly, sir. The program that the CTR
    program has undertaken to cut up the SSBN's, they already have
    embraced in that an entire complex of activities to address the
    spent fuel problem. The same kind of program would have to be
    worked out with regard to the attack submarines, the so-called
    SSN's and the cruise missile submarines, the SSGN's.
        I would like to point out, however, that in examining this
    issue we do believe that it will be a very large task to
    undertake and quite expensive, and so we believe that this
    particular set of projects will be ripe for the involvement of
    the international community, and that is an explicit part of
    what we have been planning under the expanded threat reduction
    initiative, President Clinton's new initiative in this regard.
        Senator Craig. I was just going to say, surely we were
    going to seek a shared burden there.
        Ms. Gottemoeller. Yes, sir, indeed, and I think that there
    will be other countries who are interested in participating.

                            russian breeder reactors

        Senator Craig. Mr. Chairman, let me do one more question,
    if I could, and then I would turn to our other colleagues here.
        Even as we work cooperatively with the Russians on
    disposing of excessive weapons plutonium, Russia's fast breeder
    reactors are producing plutonium. That is an accurate
    statement, is it not?
        Ms. Gottemoeller. Yes, sir.
        Senator Craig. In Idaho----
        Senator Domenici. What was that, sir?
        Senator Craig. As we are working with the Russians to get
    rid of weapons plutonium, we still have Russian reactors
    producing plutonium. That seems to be a bit of a contradiction,
    but it appears to be the case.
        In Idaho we have experience in converting the breeding
    blanket on the EBR-2 reactor to stainless steel and making
    other fuel alterations to reduce plutonium production. Would
    any witnesses care to respond to how DOE could use the EBR-2
    experience in collaboration with the Russians and Kazakhstan to
    alter their breeder reactors? Is there any thought in mind
    there?
        Ms. Holgate. Yes, sir. I had the pleasure of meeting with
    some of the scientists from Argonne West to discuss this very
    issue within the last couple of weeks. We have an active R&D
    program underway in Russia to work on converting that BN-600
    reactor to use MOX fuel, and a key element of that will be
    removing the breeder blankets that actually create the
    plutonium, and I am convinced that there is a cooperative role
    for Argonne West's experience as we move forward with the
    Russians on that project.
        Senator Craig. These reactors I assume would be converted
    to energy production. Is that the intent with the MOX fuel?
        Ms. Holgate. Yes, sir. There is only one of them.
        Senator Craig. There is only one?
        Ms. Holgate. Only one BN-600.
        Senator Craig. Thank you.
        Thank you, Mr. Chairman.
        Senator Domenici. Thank you.
        Senator Cochran.

                         sufficiency of budget request

        Senator Cochran. Mr. Chairman, Thank you.
        Dr. Reis, you responded to the chairman's question about
    whether or not the amount requested in this budget is going to
    be sufficient to ensure the safety and reliability of the U.S.
    nuclear weapons stockpile, and you answered in the affirmative.
        I tried to remember our hearing last year when we talked
    about this program that was being put in place and using
    simulation and other processes as substitutes for testing of
    our nuclear weapons, and I thought I remembered at that hearing
    that you said, or some other witness said that it would require
    $5 billion a year to fund this stockpile stewardship program,
    and I am curious what has changed to make the request of $4.5
    billion, $500 million less, sufficient.
        Dr. Reis. Senator, I do not recall saying $5 billion. We
    could look back at the record. As long as I am the
    administration witness, I would support the President's budget,
    or I basically would not be here, and I have been through three
    administrations now.
        Another witness might have said $5 billion, and I think
    there is no question it is a question of relative confidence.
    If the Senate, or if the Congress suggests that we could use
    more in certain areas, I would certainly not object to that one
    bit. Last year we asked for--$4.5 billion, and the Congress
    only gave us $4.3 billion, so there is clearly different
    adjustments in terms of how much money you can spend on this.
        It is a matter (a) of confidence, and (b) getting through--
    dealing with other priorities within the Administration. You
    have heard some of these other priorities which are very
    important today, and again the Congress also has other
    priorities.
        So I believe that the budget we have put forward to you is
    sufficient to answer the question, are we confident in our
    ability to support the stockpile now and support the stockpile
    in the future.

                         comprehensive test ban treaty

        Senator Cochran. Will the ratification of the comprehensive
    test ban treaty change any of the plans that you have underway
    for this program?
        Dr. Reis. No, sir. In fact, the whole idea of Stockpile
    Stewardship was to project ahead toward that time when the
    Comprehensive Test Ban treaty was ratified and was in place,
    and so we are building as a basic assumption that it will
    occur.
        I will add that in order for us to maintain confidence
    after that treaty is ratified, we would have to maintain the
    support for this program for the indefinite future.

                      aging nuclear scientists of concern

        Senator Cochran. There was something in your prepared
    remarks that got my attention, that the age of our nuclear
    weapons scientists, those who are familiar with the weapons and
    are capable of building a weapon, is such that by the year 2014
    most of them are going to be gone. We will not have anybody
    around who knows how to build a nuclear weapon if we had to, or
    if we wanted to. Why is that a concern?
        Dr. Reis. Clearly that is a concern because we may have to
    build again. The pace of the program, the reason we are moving
    ahead on the simulations, the reason we are moving ahead on the
    experiments is to get those new people in place to certify the
    stockpile while the people who have actually had the testing
    experience are there to help us. Let me tell you and tell the
    American people that those weapons are safe and the program we
    have in place is the right program. So far, so good, but we
    have to stay the course and keep moving in that direction.
        Senator Cochran. On the question of proliferation, I was
    pleased to hear the work that is being done in Russia to try to
    improve the capacity there for controlling exports of weapons-
    grade material and other devices.
        Do you get involved at all in missile proliferation issues
    as well, because that is so closely connected with nuclear
    weapons.
        Ms. Gottemoeller. Senator, actually the Department as you
    know focuses really on the warheads and on the fissile material
    and so no, I do not become directly involved in matters to do
    with missile proliferation.

                    concern about russian assistance to iran

        Senator Cochran. There has been some concern about Russian
    assistance to Iran in building a nuclear reactor down there.
    Why does Iran need a nuclear reactor, with all of its oil
    reserves and other energy resources? What is the purpose of
    building a nuclear reactor, other than to produce weapons-grade
    material?
        Ms. Gottemoeller. Sir, that is a question we ask ourselves
    every day, and it is a very good question I think.
        We have, as you know, imposed sanctions on three Russian
    entities just since January this year, two of which we are
    concerned are engaged in nuclear cooperation with Iran, and so
    we have been very much focused on that question and very
    concerned about it, and have been very direct with the Russian
    Government in expressing our concerns, and in conveying the
    necessity that they move rapidly to resolve these concerns and
    ensure that there is not cooperation going forward with the
    Iranian reactor program outside that which was agreed
    bilaterally with the Russian side regarding the Bushier
    reactor.
        Senator Cochran. To your knowledge, have these sanctions
    had any effect on Russian business or institute activity?
        Ms. Gottemoeller. Sir, I know the Russian Government is
    paying close attention. I was in Moscow 2 weeks ago with Deputy
    Secretary of State Strobe Talbott. We have gotten their
    attention, there is no question about it, but there is a team
    in Moscow even today talking again with them about these
    issues, so there is no question in my mind that the Russian
    Government is very focused on trying to resolve our concerns.
    We are just going to have to see what happens.
        But again, this is an issue that has consistently been
    raised at the highest level in our Government, and I know it
    will be an issue in 2 weeks time at the Gore-Primakov
    Commission meeting.
        Senator Domenici. Senator, would you yield on that?
        Senator Cochran. Yes.
        Senator Domenici. Let me just say to you, and for the
    record I indicated in my opening remarks about the only thing
    that Russia has going with America that is yielding any
    resources to Russia are energy programs. We do not have an
    economic program of assistance. We would be kind of foolish to
    be putting money into that, and they know from this Senator
    that we have to appropriate most of that in this committee.
        They know that the Iranian situation could cause any of
    these programs to be canceled just because the United States
    Congress could feel, as you have expressed to me, a grave
    concern that while we are doing this they are having their
    games with Iran, and I think in the last 4 or 5 months there is
    evidence that has been raised to higher and higher levels, and
    they now know it, and they have made some statements which
    would indicate they cannot fool us any more, that something is
    really happening. They still question the scope of what they
    are doing, but nonetheless I think your line of questions is
    very, very important.

                                    start ii

        Senator Cochran. In your visit recently to Russia, were you
    able to get a sense for what the intention of the duma might be
    toward ratification of START II, and do you continue to feel
    that that is an important initiative for our Government to
    continue to press with the Russians?
        Ms. Gottemoeller. Yes, Senator, I think it is absolutely an
    important initiative for us to press with the Russians, because
    START II will be an important aspect, I think, not only of
    further strategic arms reductions with the Russians but it
    also--you know, frankly, the Russians I think realize,
    particularly those professionals in the ministry of defense,
    that they have a tremendous budget burden to bear if they are
    expected to keep their force levels up to START I numbers, so
    within the ministry of defense, and I am convinced within the
    Government as a whole, there is a recognition of the importance
    of getting START II ratified.
        Now, in the last couple of weeks we have seen, particularly
    in the media, but we have seen reference to the fact that there
    are those in the duma who also realize that it is time to begin
    to move to get this agreement ratified. Even, I noticed in the
    press last week, Mr. Zhirinovsky has spoken up now and said
    that it is time to move forward and get the START II treaty
    ratified, so we continue to be hopeful that in fact they will
    move and get it ratified, and then we can move forward and
    begin with a negotiation of the START III agreement.

                     status of nuclear power plant in cuba

        Senator Cochran. In connection with the nuclear power
    program in Russia, we know that because of the Chernobyl
    incident there are causes for concern about the integrity of
    the reactors. At one point it was a worry here that in Cuba
    they were going to build some Chernobyl-type reactors. What is
    the status of that situation in Cuba, and do we have any threat
    to safety and security of people in Florida or elsewhere in the
    United States because of their nuclear power program in Cuba?
        Ms. Gottemoeller. Senator, indeed the Russians, the Soviets
    before them and the Russians have been cooperating to build a
    nuclear power plant in Cuba. That project is currently dormant,
    however, because the Russians, as you know, are suffering
    severe economic problems and so are the Cubans, and so in terms
    of that program being an active project, it simply is not so at
    the present time according to our observations.
        However, I would like to assure you that we keep a very
    close eye on that project in case it becomes active again.
        Senator Cochran. Thank you.
        Senator Domenici. I am sorry it has taken so long, Senator
    Dorgan. Now you can have as long as you like.

                               tritium production

        Senator Dorgan. I will be brief, Mr. Chairman. Let me thank
    all of you. This is frankly an area that I have not spent much
    time thinking about or discussing or studying.
        Dr. Reis, your testimony is very interesting in giving us,
    at least giving me a description of what stockpile stewardship
    means. One part of your testimony, I would like to just ask a
    brief question about, is the production of tritium. I
    understand its role with respect to a nuclear weapon. What I do
    not understand is where this comes from.
        I understand the decay requires it to be refreshed from
    time-to-time, and you are suggesting in your statement that we
    have not produced tritium since 1988, or whatever, and we,
    therefore, must begin going back into production. What is
    tritium?
        Dr. Reis. Tritium is an isotope of hydrogen, and when you
    get--I will not get into the physics of it, but it has two
    neutrons in addition to the proton and the electron going
    around, and so it is a special isotope of hydrogen, and it is
    not found in nature. You have to make it, and the fact that it
    has those extra neutrons, that gets involved in the fusion
    process and also helps particularly in the fission process
    itself.
        I would say it is like STP for your car, or something like
    that. It is a product that really is designed to make this
    whole nuclear weapon go. It is key to the whole hydrogen bomb
    approach, and is found in all our nuclear weapons, and as far
    as we know found in all the current modern nuclear weapons of
    all the nuclear weapons states.

                        cooperative efforts with russia

        Senator Dorgan. Thank you very much. Let me ask a question
    about the issues that Ms. Holgate and Ms. Gottemoeller
    discussed. I have not been to Russia, regrettably, but I
    understand, their economy is in decay; in collapse. They have
    chaos virtually everywhere you look because they do not have
    the resources to do the things that they really need to be
    doing.
        We are encouraging them under our arms control agreements
    to destroy weapons and destroy delivery systems, with some
    success. I think the Nunn-Lugar expenditures and other
    approaches have been remarkably successful.
        We are also involved in the disposition of fissile
    material, ours and theirs, hopefully, and then also working
    very hard on nonproliferation issues. Included in that is the
    closed cities initiative.
        One of the things that I have been interested in is the
    role of food in all of this. I want to ask just a general
    question. As you know, we produce an enormous amount of food in
    North Dakota, and Idaho, and some in New Mexico, and we produce
    grains far in excess of what we can use. My understanding is
    there is a desperate need for that, overseas even in Russia,
    and I am wondering if in the context of what we are doing with
    nonproliferation, with the destructions of weapons systems and
    delivery systems, whether there is a role either with respect
    to incentives or barter using food.
        We use food in PL-480, we use it in GSP credits and so on,
    but is there an additional role that we might evaluate here in
    the context of all the things we are trying to do to encourage
    the Russians to move in the right direction at a time when they
    do not have enough food? Food, of course, is one of the
    requisites for living and stability.
        So let me ask Ms. Gottemoeller if you would respond to
    that.
        Ms. Gottemoeller. Thank you, Senator. As you know, food
    assistance is in general a very important part of our
    cooperative efforts with Russia and has played a vital role in
    the crisis that has emerged since the August crash of the
    ruble, and so both historically and at the current stage it is
    an important, very important part of our overall relationship
    with Russia.
        With regard to the very interesting idea that you have
    raised, we have already begun working together with your staff
    to evaluate the idea. My staff met with yours last week once,
    and I understand they will be meeting again today, and so I
    think it is an idea well worth exploring, and we really look
    forward to working with you on it.
        Senator Dorgan. I appreciate that. This is one of the ideas
    that I have shared with Senator Craig, who I think also may
    have some interest in it.
        I ask the question not to do anything other than enhance
    the kinds of subjects we are talking about. I happen to think
    that of all the issues we deal with in the world today, the
    proliferation of nuclear weapons and weapons of mass
    destruction and their delivery systems represent the one area
    that has the potential of seriously threatening us, our
    children, and our grandchildren, and the future of this world.
        The work that you are doing and the work we are doing as a
    country to establish a priority in these areas is absolutely
    essential for our survival, and my hope is that we are able to
    see a START III and see continued reductions in nuclear weapons
    and delivery systems.
        I hope all of that can be remarkably successful, but the
    discussion about Iran and North Korea and missile tests, the
    efforts in the black market to achieve materials to produce
    nuclear weapons, all of these things are very frightening and
    very scary, and that is why the work that you all are doing is
    very important, and that is why funding for that work is so
    important as well.
        Mr. Chairman, I have more, but I will be meeting with the
    witnesses as I become more familiar with these areas. You have
    had the advantage of spending a lot of time in this area and
    have done wonderful work. I thank the representatives from the
    agency.
        Senator Domenici. Well, Senator, the 5 years since the
    beginning of the Stockpile Stewardship as an alternative to
    underground testing, I have been the chairman of the committee
    for those 5 years, and I am very fortunate in that I have
    become acquainted with and am kind of proud of this program,
    and I do my best not only here but with the administration to
    keep their budget up.
        I was part of getting them to go up to the $4.5 billion
    level without any question, and those who are familiar with it
    know that.
        Dr. Reis. Without any question, Senator.

                         russian plutonium disposition

        Senator Domenici. And also with reference to the plutonium
    disposition, which I think you quickly caught on to, it is
    very, very important in terms of the disarmament, a major
    international disarmament approach, but it is difficult. I
    mean, there is no question they have different motives,
    different goals, et cetera, than we do.
        I want to ask Ms. Holgate, Senator Craig raised the issue
    of--what he said, it is kind of ironic that in the fast breeder
    reactors they are producing plutonium and we are trying to get
    rid of 50 tons of their weapons-grade pit-formed plutonium. I
    know that some of these reactors do produce plutonium, but are
    they processing plutonium so that it can be used in weapons?
        Ms. Holgate. Not that I am aware of, sir.
        Senator Domenici. So there is a difference. That plutonium
    that is coming out of those reactors, something has to happen
    to that.
        Ms. Holgate. That is correct.
        Senator Domenici. And what we are talking about is pure
    plutonium for weapons that has already been processed and is in
    the kind of forms that were part of the nuclear weapons.
        Ms. Holgate. That is correct, sir.
        Senator Craig. Mr. Chairman, you are absolutely right. My
    intent was not to do that. My intent was to suggest that we
    could assist them in converting these reactors to breed less
    plutonium and we have the talent and the skill to do that.

                 progress with russia on plutonium disposition

        Senator Domenici. Senator, one of the anomalies that exists
    right now that makes it very difficult for this agreement with
    the Russians with reference to the disposition of plutonium to
    occur is that they actually believe this pure plutonium is a
    very, very valuable legacy, not a legacy for military use, but
    a legacy for civilian use in breeder reactors, because it is a
    great fuel for breeder reactors, and they have dreams of
    building the second and third generation of breeder reactors.
        In fact, we are either fortunate or unfortunate, depending
    on how you look at it, to have the head of the Russian nuclear
    agency and an expert in this idea of coming forth with another
    generation that would use this plutonium, which caused them not
    to want to destroy it. On the other hand, I think we are
    struggling here with the concept of just keeping some kind of
    improved light water reactor, the next generation of that
    alive, and not a third and fourth generation breeder reactor,
    and that is causing some very difficult times in terms of the
    negotiating. It is a difficult concept, bridging.
        Let me say to you, Ms. Holgate, I do not want to overstate
    the case of the urgency of getting an agreement signed and
    putting some of this money to actual use, but you know that I
    was instrumental in pushing to put a time limit in that
    communique you spoke of. In fact, it says we will be on the way
    in 6 months.
        I do not know the exact words, but it has a 6-month time
    frame in there, and now I am telling you from a practical
    standpoint how important it is, because there it sits, and it
    has only been there since the supplemental of when, September,
    when did we do it, or October, and the House in trying to find
    money to cover a new supplemental is already contemplating
    using $125 million of it. I thought $100 million yesterday when
    I spoke to your negotiators. It is $125 million, or, I am
    sorry, $150 million. It is going up every day. They will have
    some more supplementals and they will use the entire $200
    million as an offset.
        So I think it is vitally important that we show some
    progress and that the Russians understand this is not going to
    sit around there for very long, and they have got to respond to
    money, because they desperately need it.
        Ms. Holgate. I could not agree more, sir, and believe me, I
    am reminding our State Department colleagues of the importance
    of that on virtually an hourly basis.

                           production of new weapons

        Senator Domenici. Well, I do want to say, since the
    Department of Energy has all the expertise, in my opinion, and
    talent, it is with great reluctance that I have sat by and
    watched the State Department of the United States take over
    these negotiations, but that is a bigger issue than me. I mean,
    that is an executive issue that I guess I could fix it by
    saying they cannot in a bill, but I would not do that.
        But they have now guaranteed me that they have the best
    negotiator that they have ever had on these kinds of matters. I
    have met him. I just hope he is not a typical State Department
    negotiator, because they deal in eons in terms of
    relationships, and this one will not last that long.
        Let me ask a question regarding the production of new
    weapons. In my State and in various parts of the country where
    we have groups that are against stockpile stewardship and our
    laboratories spending the money they are spending, which you
    were just asked, is it enough. They are saying it is too much,
    but they are also saying we are making new nuclear weapons, new
    nuclear bombs.
        Now, are we currently producing or planning to produce any
    new nuclear weapons, and when did we last produce a new nuclear
    weapon?
        Dr. Reis. There are no current plans whatsoever to produce
    new nuclear weapons. The last one produced was in 1989.
        Senator Domenici. Now, I am certain that those very same
    people and groups do not believe you, and do not believe me.
        Dr. Reis. I am under oath. [Laughter.]
        Senator Domenici. Well, frankly, I just want to repeat that
    everything I can determine the Department is not engaged in any
    clandestine efforts to produce nuclear weapons, they are not
    being produced, and we have not produced them in quite some
    time.
        Dr. Reis. That is correct, Senator.

                         reestablishing pit production

        Senator Domenici. Now, sometimes the opponents say, well,
    you are producing, you are getting ready to produce pits, which
    are an integral part of the American, as we name it, the pits
    of an American nuclear weapon, and you are getting ready to
    have a facility in Los Alamos that could produce 20 pits by the
    year 2007, and they construe that to be making bombs, new
    bombs.
        Now, the truth of the matter is, the Stockpile Stewardship
    Program is aimed, as you indicated, at determining each and
    every part of the nuclear weapon, and whether it still has
    integrity in it, and whether it still has life and can do its
    job, and the pit production, when we get there, it is to have
    some spare pits for replacement purposes. Is that correct?
        Dr. Reis. That is correct. As you know, every year we take
    apart weapons in the stockpile. We take apart approximately 11
    of each weapon type, bring them back from the stockpile, take
    them apart, and one of those from each type are, if you will,
    destructively tested, where we take the pit, and we look at its
    characteristics. We look at it under microscopes, electron
    microscopes. We go through all the forensics that we need to.
        That pit is no longer useful, so when we have to replace
    those and put those back in the stockpile, we have to put a new
    pit in the weapon. We did make some spares when we made those
    production pits. Those spares will be running out in a
    relatively short period of time, and so we need a new system, a
    new factory, if you will, to put those pits together.
        We have closed the Rocky Flats, where we made those pits in
    the past. It is completely closed, and no intention of opening
    it, so we have to replace the pits we are currently using for
    those surveillance programs.

                               gao report on ipp

        Senator Domenici. Let me move to Ms. Gottemoeller. The GAO
    has issued a report on one of the programs that is aimed at
    trying to keep Russian scientists with the kind of expertise
    that we are talking about here in Russia, rather than having
    them as a commodity for barter or sale in the world.
        That report indicates that scientists who receive support
    from the IPP program may work on dual use technologies, or may
    even continue to work on weapons technology when they are not
    working in the IPP projects. How do you respond to that
    complaint?
        Ms. Gottemoeller. Well, Senator, if I may, I would like to
    divide my answer into two parts. First of all, as I indicated
    earlier, we are very, very serious about ensuring that projects
    that are undertaken in the IPP program do not in fact
    contribute in a dual use mode or in a nuclear mode to the
    development of new capability in the Russian military
    establishment, and we are very serious about that.
        We make every effort through our review processes,
    including through very serious review processes involving the
    intelligence community, to bring all information to bear in
    order to ensure that there is no such aspect to any of our IPP
    projects.
        I would like to point out, though, that with regard to the
    nuclear weapons scientists, Russia is still a very important
    nuclear weapons State under the NPT, and they have the same
    stockpile stewardship concerns that we have. In other words,
    they need to continue to maintain the safety and the security
    of their very large nuclear arsenal, so essentially it is
    important for their nuclear scientists to continue to work in
    their stockpile stewardship program, and that is a very
    important aspect that we support for our own national security,
    because we want to ensure that their nuclear stockpile remains
    safe and secure.
        However, with regard to the chemical and biological
    scientists, the problem is easier because chemical and
    biological weapons have been outlawed by international law, and
    so we really have an easier problem there in terms of
    delineating exactly what those scientists may and may not work
    on.
        With regard to the nuclear programs it is a little bit more
    complex, but I am confident that we can ensure that the
    scientists are not contributing to new Russian nuclear
    capability.

                     russia's production of nuclear weapons

        Senator Domenici. I would say, and you correct me if I am
    wrong, that the Russians could not honestly answer that they
    are not producing new nuclear weapons, because they do that,
    right? They still are producing them, is that correct?
        Ms. Gottemoeller. Sir, their approach to stockpile
    stewardship is----
        Senator Domenici. I am going to get to that in a minute.
    Just answer my question.
        Ms. Gottemoeller. They are producing, yes.
        Senator Domenici. The point of that, however, is that we
    chose a path at a juncture in our nuclear weapons history to go
    with very complicated weapons that we thought were far
    superior, difficult to put together, and we try to maintain
    them and keep them for long periods of time, which is what we
    are preserving, that kind of weapon.
        Ms. Gottemoeller. Yes, sir.
        Senator Domenici. They made a decision to go with a much
    easier design that does not have as long lasting qualities and
    is--in some cases the parts are more robust. They replenish
    those frequently, as compared to us doing it rather
    infrequently, and us indicating now we are not going to
    replenish them as a weapon at all, and so they must do that to
    keep their stockpile up even if they were engaged in a
    stewardship program, is that correct?
        Ms. Gottemoeller. That is correct, sir. They employ a
    remanufacturing approach.
        Senator Domenici. Remanufacturing of the weapon?
        Ms. Gottemoeller. Yes.
        Senator Domenici. And we are engaged in pieces that we are
    going to replace to keep it solid. We need a huge inventory of
    new things to make sure we are doing that right. We need big
    computers. They may not. They might like to have them, but they
    may not need them to keep theirs going in a remanufactured
    mode.
        I do want to say that I am very pleased with the work you
    are doing, and I did all I could to get your rank moved up. I
    think when you are over there negotiating with the Russians in
    the capacity that you are, you ought to have the right title,
    and I hope we can work on that again and get it working in the
    committee and see what we can do to raise your title to what it
    ought to be.
        Ms. Gottemoeller. Thank you very much, Senator. I very much
    appreciated your support throughout. You have been a great
    help.

                           new construction projects

        Senator Domenici. With reference to the construction of new
    buildings, Dr. Reis, there are three new construction starts in
    your stockpile stewardship program. The evidence before you and
    before us from the independent project review submitted to
    Congress gives a mixed picture of DOE's readiness to initiate
    new construction projects.
        What actions have you taken to ensure that projects are
    thoroughly reviewed for mission needs, the scope, costs, and
    schedules are firm and clearly established, and that quality
    project management personnel are in place at the labs within
    DOE?
        Dr. Reis. Well, Senator, I think I agree with you that our
    record in terms of new construction projects is mixed. Some we
    do very well, and some we have done less than very well, to say
    the least.
        The Department has put together a detailed review by
    external reviewers. We have initiated our own processes as
    well, working particularly with John Browne, the Director out
    at Los Alamos where we have a particular concern. In addition,
    Dr. Bishop, Bill Bishop, our program manager for the
    accelerated production of tritium, which is one program that
    was on time and on budget and Dr. Bishop has gotten a special
    assignment, if you will, to go through and assure ourselves
    that we are moving in the right direction on construction
    projects.
        There are others--the National Ignition Facility, which is
    probably the largest, most complex program being done in the
    Nation is on time, on schedule, and has put in place right from
    the start some of the very best program management that we know
    available.
        So we are trying to, if you will, use a lessons learned
    approach as well. Those things that are doing well are going to
    help those things that are not doing so well.
        Senator Domenici. Thank you.
        Senator Craig.

                           nuclear cities initiative

        Senator Craig. Just one last question, and I guess it is
    really more of a comment than a question. Senator Dorgan
    referenced the nuclear cities initiative that Secretary
    Richardson has developed with the closed weapon cities of the
    Soviet Union, and I see that initially the teams are between
    Russian cities and DOE weapons labs.
        I guess my comment would be that it would be my hope that
    after the initial teams have been in place for a while, that
    maybe DOE would consider opening this initiative to nonweapons
    labs.
        Once again, I think we have an opportunity to contribute
    here, and would like to do that, and I know certainly folks at
    my lab would very much like to.
        Ms. Gottemoeller. If I may comment, Senator, we already
    have that door open, and very much want to have the
    participation not only of the weapons labs but of the
    nonweapons labs as well, and frankly I think one of the very
    important areas that we can work on that will involve INEEL is
    with reference to the Environmental Safety Center.
        The Russians have some interesting technologies that we
    have seen coming out of their nuclear complex, out of their
    nuclear cities which can provide some important help for them
    in their cleanup arena, and I expect that the Environmental
    Safety Center will be able to work with them to help to develop
    some of those technologies and perhaps commercialize them
    beyond Russia, so I really see an important role for INEEL in
    that regard.
        Senator Craig. Great. Thank you.
        Mr. Chairman, thank you.
        Senator Domenici. Senator Cochran.

                               domestic security

        Senator Cochran. Mr. Chairman, I feel constrained to ask
    about the so-called lapse in security that we have been reading
    about in the press, the fact that we have had secrets or
    classified information about our nuclear weapons program fall
    into the hands of other countries, particularly China in this
    situation, that we have had reported.
        Have there been changes implemented now to fully protect
    the security of our classified information with respect to our
    nuclear weapons program?
        Dr. Reis. Let me take that one, and perhaps Ms.
    Gottemoeller would like to comment.
        We have had significant changes, and we have had those
    changes occurring over some years. I think Secretary Richardson
    has been particularly aggressive in that regard, but when this
    program, or this issue first came up some years ago both the
    Department and the other parts of the national security
    establishment were made aware, and we have begun compensatory
    actions right from the start.
        Senator Cochran. Can you assure us that the information
    that we have classified and restricted is being safeguarded by
    new procedures that are being monitored carefully and enforced
    to protect the Nation's security interest?
        Dr. Reis. We are doing everything we can in that regard,
    Senator Cochran.
        Do you want to add to that?
        Ms. Gottemoeller. Senator Cochran, perhaps I would just add
    a few details. Secretary Pena, and after Secretary Richardson,
    and Dr. Reis referred to the very energetic way in which
    Secretary Richardson has tackled this problem, but the
    implementation of Presidential Decision Directive 61 has been
    taken very seriously over the last 6 months by now two
    Secretaries, it has resulted in a senior FBI individual, Mr. Ed
    Curran, coming over and taking over the counterintelligence
    operations at DOE, working very closely with the labs. He has
    helped to bring in some very experienced FBI specialists to
    work with the laboratories and with the lab directors to
    improve their counterintelligence performance.
        We have also doubled and then redoubled the budget for
    counterintelligence, beginning with $7 million and now up to
    $31 million over the past year, so we are moving in that
    regard, and you were referring to some of the security
    procedures. That has been an area that has received an enormous
    amount of attention, and we are really strengthening security
    procedures, including incorporating the use of polygraphs in
    certain circumstances.
        So, I think that there is a great deal of attention to this
    set of problems now, and I think that we have a path forward.
    We have to continue working it very hard, but we do have a path
    forward.
        Senator Cochran. Thank you very much.

                            chinese nuclear weapons

        Senator Domenici. Dr. Reis, I want to join in a way with
    Senator Cochran, who expressed concerns. Obviously, we will all
    be hearing more about what has happened over the last years
    with reference to China.
        I wonder, Dr. Reis, from another vantage point, you know,
    we know so much about the Russian nuclear stockpile, and the
    SALT negotiations have yielded a great deal in terms of where
    we ought to be and where we are moving, and what has dawned on
    me of late is that I have not heard anything about
    relationships between the United States and China regarding
    their nuclear stockpile, nor have I heard any assessment in any
    committees about how serious it is, and I think we ought to
    look at that, too.
        We are so busy now worrying about Russia, and Russia is in
    an economic doldrum from which they may not spring forth with
    any economic vitality for a long time. But China is not in that
    condition, and China seems to be producing a lot of nuclear
    weapons, and they are not even loath, Senator Cochran, to
    putting them in parades. They just run their nuclear weapons
    down the streets and roads in parades.
        So there is a lot know about them, but I think maybe we
    ought to consider asking somebody to brief us, or some
    committee, maybe yours, on the status of the Chinese nuclear
    weapons situation, because it is getting more and more serious,
    and we do not seem to be--other than now we are worried about
    how they got it, we do not seem to be talking about how serious
    it is.
        Maybe you have in your subcommittee, when you are talking
    about antimissiles. Has there been some assessment of China in
    that?
        Dr. Reis. Senator, I would encourage you to do so. I think
    we obviously cannot discuss this here. I think there are people
    in the laboratories who have, I think, as fine a knowledge as
    there is on that subject.
        As you point out, we certainly do not know the same amount
    that we know about other nations' weapons, but I think we have
    the ability to give you, or to answer those questions about
    what we know and what we do not know. There are certainly
    experts at the laboratories who I am sure would be available to
    give you their candid views on what the status is in China.

                         Additional committee questions

        Senator Domenici. Could you answer our submitted questions
    within 2 weeks?
        Dr. Reis. Absolutely.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                    Questions Submitted by Senator Domenici

                   condition of the nuclear weapons stockpile
        Question. Dr. Reis, is the nuclear weapons stockpile safe, reliable
    and secure?
        Answer. Yes. The Secretaries of Energy and Defense have completed
    the third annual certification and transmitted it to the President. It
    states that the nuclear weapons stockpile is safe and reliable and no
    underground nuclear testing is required at this time.
        Question. Do you have confidence that the weapons in the stockpile
    can and will perform as designed?
        Answer. Yes. Based on the detailed analysis conducted during the
    annual certification process, I am confident that the stockpile will
    perform as designed.
        Question. Are there any critical needs not addressed in the budget
    request because of lack of budgetary resources? If so, please explain.
        Answer. No. The budget request for Defense Programs is sufficient
    to address all critical needs. We have considered carefully both the
    long-term and short-term needs of the Stockpile Stewardship program,
    and believe that we have presented a balanced program within the $4.5
    billion funding envelope.
                         funding for weapons activities
        Question. Will the budget request before the committee allow DOE to
    meet all the DOD annual weapon alterations, modifications, and
    surveillance schedules? If not, explain what they are and why they are
    not of sufficient priority that they are not included in the
    Department's budget request?
        Answer. The budget request does not allow DOE to meet DOD's targets
    for annual weapon alterations, modifications, and surveillance
    schedules. Although the highest priority requirements are met in our
    budget request, some workload related to alterations, modifications,
    and surveillance has been stretched out. This includes: Pantex workload
    to support full stockpile surveillance efforts on the W80, W62, B83 and
    W88; Y-12 plant workload activities for surveillance test assemblies
    for the W87, W88, and B61; Kansas City Plant workload for the B61-7
    common radar alteration; and Sandia workload for surveillance test
    assemblies for the B61 alterations, and for Gas Transfer Systems for
    the W62, B83, and W87. The changes were necessary to balance near-term
    stockpile requirements with long-term stockpile stewardship needs.
    While these deferred activities are important, they will not have a
    direct impact on the safety or reliability of the stockpile for fiscal
    year 2000.
                            chiles commission report
        Question. In response to a provision in the National Defense
    Authorization of 1997, the Commission on Maintaining United States
    Nuclear Weapon Expertise (the so called Chiles Commission) has
    submitted their final report and recommendations on recruiting and
    retaining the critical technical and scientific workforce needed to
    support and maintain over the long term a safe and reliable nuclear
    weapons stockpile in the absence of underground nuclear testing. First,
    are you familiar with the report, and if so, can you review briefly the
    Commission's findings and recommendations?
        Answer. Yes, I am familiar with the report. The Commission's report
    contains 12 findings and 12 specific recommendations for action to be
    taken by the DOE, the Congress, the Administration, DOE national
    laboratories, and production plants. These recommendations emphasize
    competitive recruiting and retention practices, management and
    structural reforms, and long-term stability and oversight issues.
        Question. Does DOE agree with the findings and recommendations?
    Does this cause you alarm or concern?
        Answer. The Commission was comprised of individuals with knowledge
    of the Stockpile Stewardship Program. Their findings and
    recommendations are sound and I find no reason to be either alarmed or
    concerned. The Commission ``found a great deal that was healthy in the
    nuclear weapons complex with many trends moving in the right
    direction'' and that ``the nuclear weapons program is not in crisis,
    but additional steps are needed now.'' I commend the Commission for its
    thoroughness and willingness to report their findings and
    recommendations in an objective manner.
        Question. How does DOE plan to respond to the Commission's
    recommendations?
        Answer. The Commission's recommendations call for actions not only
    by DOE but by the Congress, the Administration, and the DOE
    laboratories and production plants. The Department's response to the
    Chiles Commission report will encompass a number of actions beginning
    with a request to DOE Defense Program lab and plant directors for data
    regarding critical skills and newly hired employees. This information
    will help us to corporately assess whether current hiring trends will
    maintain critical technical positions.
        Question. Now, one of the Commission's recommendations was that the
    DOE establish and implement, on a priority basis, plans for
    replenishing essential technical workforce needs in critical skills
    which will erode significantly over the next few years. How does the
    Department plan to proceed with this recommendation?
        Answer. To proceed with the Commission's recommendation to
    replenish the essential technical workforce, we have requested a
    listing of critical skills from all DOE Defense Program laboratory and
    plant directors to include: the number of people to be hired in these
    critical skill areas during fiscal year 1999; the number hired as of
    April 1, 1999; the projected number to be hired for the remainder of
    fiscal year 1999 and for fiscal year 2000 consistent with current
    budgets; and, an assessment of the number of new hires on the
    demographics in the critical skill areas. The data from the labs and
    plants will enable us to assess whether current and projected hiring is
    sufficient to ensure that critical skill areas are not eroding over
    time. By the end of fiscal year 2000, new hires in critical skill areas
    should begin to lower the average age of the technical and scientific
    workforce in the nuclear weapons program.
                             stockpile stewardship
        Question. Overall, the budget request for Stockpile Stewardship
    increases by $160 million or 7.5 percent over the fiscal year 1999
    appropriation of $2.126 billion for a total of $2.286 billion requested
    for fiscal year 2000. Major increases are being requested for the core
    stockpile stewardship program, construction of new facilities to
    support the stockpile stewardship effort, and the Accelerated Strategic
    Computing Initiative (ASCI).
        I note that the budget request projects a 7.5 percent increase for
    Stockpile Stewardship and at the same time includes a 4 percent
    reduction for Stockpile Management. Does this cause any problems in
    carrying out an integrated program with the Labs and the production
    plants?
        Answer. This does not cause any significant problems in carrying
    out an integrated program with the labs and production plants. The
    budget must balance many legitimate but competing requirements within a
    finite resource envelope. I believe that the budget request submitted
    to Congress reflects the appropriate balancing of priorities.
        Question. Why has Defense Programs allocated such significant
    increases in the Stockpile Stewardship program and apparently reduced
    the Stockpile Management program?
        Answer. The increases in the Stockpile Stewardship program are
    primarily driven by the planned growth in the Accelerated Strategic
    Computing Initiative program itself, and increases to support its
    integration into the ongoing science and engineering programs. This
    integration will allow these programs to more effectively support the
    long-term needs of the stockpile, both at the labs and at the plants,
    particularly through support to the Stockpile Life Extension Program,
    the Enhanced Surveillance Program, and the Advanced Manufacturing
    Design and Production Technologies initiatives.
        The reduction in the Stockpile Management program reflects reduced
    dismantlement requirements; completion of one time costs associated
    with the restart of enriched uranium operations at Y-12; and completion
    of congressionally directed infrastructure improvements at the plants.
        Question. The approach in the past has been to have an integrated
    program between the weapon labs stockpile stewardship and the
    production plants stockpile management effort. How does this budget
    unify and integrate the laboratories and the production complex?
        Answer. We continue to have a closely integrated program that
    balances near and longer term needs of the stockpile. Ongoing
    maintenance and evaluation of the current stockpile ensures the near-
    term viability of the stockpile, while investments in science today
    will provide the technologies and tools necessary to conduct
    maintenance and evaluation of the enduring, long term stockpile.
    Examples of this integration are found in the Accelerated Strategic
    Computing Initiative, the Enhanced Surveillance Program, the Advanced
    Design and Production Technologies initiative, and Stockpile Life
    Extension Programs.
        Question. Dr. Reis, the Department has been spending over $2.0
    billion annually to develop the scientific base, the Stockpile
    Stewardship effort, to replace the capabilities lost when the United
    States made the decision to stop underground nuclear weapons testing.
    How much has been spent to date in developing this scientific and
    analytical capability?
        Answer. We have invested about $2 billion annually, on average, in
    these scientific and analytical capabilities since the initiation of
    the Stockpile Stewardship Program in 1996, for a total of about $10
    billion through fiscal year 2000. This represents roughly half of
    Defense Programs' funding for this period.
        Question. When will the Department be able to say with confidence
    that the Stockpile Stewardship program is capable of replacing the
    underground testing program? Can you give the committee any examples of
    how the scientific capability of Stockpile Stewardship program has
    already contributed to solving real problems in the current stockpile?
        Answer. Stockpile Stewardship is working now. While it has been
    more than six years since the last nuclear test, we have successfully
    addressed several problems with existing warheads by using a
    combination of computer analysis, archived test and manufacturing data,
    and most importantly, the collective judgment of the two weapon design
    laboratories. This success, using the experimental and testing tools
    available today, provides confidence that even more powerful computing
    and testing tools being developed will allow us to solve future
    stockpile problems without nuclear testing. By annually certifying the
    safety and reliability of the stockpile, the DOE confirms that
    Stockpile Stewardship can be relied on now and in the future. We have
    successfully completed the process three times, and the fourth annual
    certification process is underway. The third certification was provided
    to the President by the Secretaries of Energy and Defense on December
    22, 1998.
        The scientific capability of the Stockpile Stewardship Program is
    solving real problems in the current stockpile. Observations from our
    surveillance program have led to questions which have been resolved
    through the combined application of our advanced computational codes
    and laboratory experiments. The success in providing B61-11
    certification relied heavily on the scientific capability of the
    Stockpile Stewardship program. New capabilities developed since the
    start of the Stewardship program, such as proton radiography, have
    provided scientific contributions to certification. Complex chemistry
    models of high-explosive binder materials, benchmarked by proton
    radiography experiments, have provided us estimates of the service
    lifetime of our high explosives enabling us to make some decisions
    regarding stockpile refurbishment schedules.
        Question. Is the Department of Defense confident that the Stockpile
    Stewardship program is capable of addressing the nuclear weapons
    stockpile security, safety and reliability needs and issues?
        Answer. I cannot speak for the Department of Defense, however, the
    Department of Energy has maintained an active dialog with the
    Department of Defense regarding our Stockpile Stewardship Program since
    the program was established at the direction of the President as part
    of his decision to extend the moratorium on underground nuclear
    testing. Our Stockpile Stewardship Program Plan which outlines the
    steps necessary to ensure that the enduring U.S. nuclear stockpile
    continues to remain safe and reliable for the foreseeable future in the
    absence of underground nuclear testing has been reviewed and approved
    each year by the Department of Defense. The Secretaries of Defense and
    Energy have recently concluded their third annual stockpile
    certification to the President affirming that there is no need to
    conduct an underground nuclear test to resolve any safety or
    reliability problem in the stockpile.
                           national ignition facility
        Question. The budget request for fiscal year 2000 includes $248
    million for the National Ignition Facility (NIF) which is a major
    element of the Stockpile Stewardship effort fiscal year 1999 was the
    peak year for construction funding, and the budget request for fiscal
    year 2000 maintains the fiscal year 2003 completion schedule. The
    project remains within the estimated $1.1 billion cost estimate.
        Dr. Reis, how important is the NIF to the success of Stockpile
    Stewardship and maintaining the nuclear deterrent?
        Answer. The National Ignition Facility (NIF) is essential for the
    success of the science-based Stockpile Stewardship program. It will
    enable us to conduct weapon physics experiments and measurements
    important to primaries and secondaries at temperatures and densities
    close to those occurring in nuclear weapons detonation. The NIF will
    examine the effects of specific age-related changes and other nuclear
    component modifications on weapon performance. The fusion ignition
    mission will test many of the same skills used in analyzing nuclear
    weapon performance and NIF will test simulation codes developed under
    the Accelerated Strategic Computing Initiative (ASCI).
        As the world's premier laser facility, NIF will attract the highest
    quality scientists for work in high energy density science and weapons
    physics. It will provide an excellent tool for recruiting and training
    the next generation of scientists for the Stockpile Stewardship
    Program.
        Question. Now, I understand that DOE plans to use the first several
    beam lines of NIF to address nuclear weapons stockpile issues prior to
    actual completion of the entire facility in fiscal year 2003, is that
    correct? Explain the importance in using NIF as early as possible and
    how this will contribute to the overall success of not only the NIF
    project, but also to the Stockpile Stewardship Program as well.
        Answer. The size and complexity of NIF and the scientific precision
    needed to achieve ignition, make it important to gain detailed
    understanding of the laser performance at NIF as soon as possible. For
    non-ignition weapons science, we would like to get the results of
    selected higher energy experiments as soon as possible. In particular
    there are a number of important tests that could significantly aid
    development and testing of the computer simulations in ASCI. Therefore,
    the NIF project plans to provide the infrastructure on a schedule that
    allows for experiments to be done before the completion of the
    construction in 2003.
        NIF will be about fifty times more energetic than present
    facilities, such as the Omega laser at the University of Rochester.
    Even the first several beam lines of NIF will have significantly more
    power and energy than present facilities. This higher power and energy
    of these beam lines will allow experiments on stockpile specific
    issues, hydrodynamics, radiation physics, and material properties to
    expand into new parameter regimes not presently attainable. The NIF
    Weapons and Ignition planning groups have developed proposed campaigns,
    which exploit partial NIF operation during the startup and testing
    process and better prepare NIF scientists for full-power NIF
    operations. Early experimental utilization of NIF will also improve NIF
    maintenance, startup and operating procedures.
        Question. Now, the budget justification implies that there is a
    shortfall in funding for NIF which puts the ignition at risk, delays
    the initiation of the cryogenic handling system, and provides only
    minimal development of target diagnostics and experimental equipment.
    If NIF is as important to the national security as you say and setting
    aside budget constraints, how do you explain the lack of budget support
    to these elements of NIF? What impact does this shortfall have on DOE's
    fiscal year 2001 initial use of NIF and the fiscal year 2003 project
    completion schedule?
        Answer. The fiscal year 2003 project completion schedule is not at
    risk, nor is the ultimate technical objective of achieving ignition.
    However, there is a potential delay from the schedule established in
    1996 in the start of new program activities on the cryogenic target
    system that is required for ignition experiments as well as a potential
    delay in development of selected NIF diagnostics. The delays have no
    impact on completion of the NIF construction project, but could delay
    achieving ignition by as much as one year. Experiments using the first
    eight laser beams are still expected to begin in fiscal year 2001 and
    will result in obtaining significant data for ignition, weapons
    physics, and laser startup, but collection of some specific
    experimental data may be delayed due to the potential diagnostic
    delays. We are working to improve the integration of our experimental,
    computational and stockpile workload to better meet stockpile
    certification needs. In that process, we are developing options that
    could mitigate or eliminate the potential delays in the diagnostics and
    cryogenic target system for NIF should that prove to be a higher
    priority than other activities within the ICF or Core Stockpile
    Stewardship lines of the budget.
        Question. The budget request includes $5.9 million in operating
    funds to support the NIF Project. Is this sufficient to support the
    hiring and training of scientists needed to meet DOE Program goals once
    initial operation of NIF begins and the project is fully operational in
    fiscal year 2003?
        Answer. The $5.9 million budget request in operating funds for NIF
    is contained within the Other Project Cost (OPC) portion of the Total
    Project Cost (TPC) for the NIF Project and is not used for the purposes
    of funding the operations or staffing of NIF. The OPC funding request
    is to provide for project funded activities such as required
    environmental and safety documentation and startup planning. The hiring
    and training of scientists needed to achieve the NIF mission is funded
    by the national ICF and weapon science programs. In the present plan,
    the staffing requirements for first use of NIF are adequately funded in
    the program operations budget.
        Question. What impact does the budget request have on the schedule
    for proving ignition from laser fusion?
        Answer. We plan to prove ignition with the indirect drive approach
    as expeditiously as possible. When we submitted last year's budget, we
    projected that ignition experiments would begin in early fiscal year
    2006. At the time this year's budget was submitted, we projected a
    delay of up to one year in the start of ignition experiments due to
    unavailability of the cryogenic target handling system and some
    diagnostics. We have been studying options that may mitigate or
    eliminate these potential delays.
                          advanced driver development
        Question. Over the past several years, scientists at Sandia Lab
    have made major advances in pulsed power accelerators using the Z
    facility. Yet, the fiscal year 2000 budget before the committee
    requests no funding to continue important advanced driver development.
    Other than budget constraints, what is the rationale for this drastic
    action?
        Answer. Development of pulsed power accelerator technology such as
    that used at the Z-facility, is funded in fiscal year 1999 and fiscal
    year 2000 within the Inertial Confinement Fusion budget. The Sandia
    pulsed power program has achieved outstanding success at the Z facility
    and continues to set performance records in x-ray output, and in power
    level and temperature. The Department's fiscal year 2000 budget request
    at Sandia also reflects the completion of the installation of the
    important Z/Beamlet backlighter Z facility. The Z facility will be used
    for experiments contributing to stockpile evaluations and for research
    to understand the potential of reaching fusion conditions with z-
    pinches. A review by the National Academy of Sciences will begin within
    a few months to evaluate the scientific and technical credibility of
    obtaining fusion with the z-pinch approach.
        Consistent with Congressional direction, the Advanced Driver
    Development budget category under the ICF Program supports only the
    development of high average power lasers and should not be confused
    with funding for advanced pulsed power. No funding is requested for the
    Advanced Driver Development budget category in fiscal year 2000.
        Question. Does DOE plan to accomplish this work in other parts of
    the Inertial Fusion program?
        Answer. The Department's strategy in the near-term is to fully
    exploit the Z facility for Stockpile Stewardship needs. Development of
    advanced pulsed power accelerator technology depends on continued
    progress in Z-pinch physics, validation of fusion ignition on the
    National Ignition Facility, as well as a consensus on mission need. Any
    decision to proceed with another fusion facility within the Stewardship
    program would have to consider the value of additional fusion
    capability balanced against other program needs.
        Question. What impact will this action have on the goals of
    inertial fusion energy and future defense program needs?
        Answer. The continuance of the Defense Programs pulsed power
    program enables the United States to retain world leadership in this
    rapidly advancing technology. The Z accelerator at Sandia has already
    been used for some Stockpile Stewardship program applications. Pursuing
    inertial fusion for defense applications advances inertial fusion
    energy because the two applications have many areas in common. However,
    substantial additional technology development is required for inertial
    fusion energy, including a reliable high-repetition rate driver and a
    target-driver standoff concepts. The Department intends to use laser,
    pulsed-power, and other facilities to advance its capability in
    inertial fusion for defense and energy applications. The great
    challenge of obtaining inertial fusion and the complexity of applying
    this capability for defense and energy interests dictates the need for
    expert judgments in evaluating development paths. The Department needs
    both steady technical progress and scientific reviews to guide its
    fusion development decisions. The present programs are balancing these
    factors.
        Question. How important is the work undertaken in the Advanced
    Driver Program to attracting and retaining scientists in DOE's
    stewardship program?
        Answer. The Z-pinch drivers are being applied to DOE's stewardship
    program today and this work is a factor in attracting and retaining
    scientists. These experiments are attracting experimentalists and
    theorists throughout the nuclear weapons community, including Los
    Alamos and Lawrence Livermore National Laboratories. These scientists
    are using and advancing their skills to design and field experiments at
    the Z facility that validate large simulation codes--skills which are
    required for a successful stewardship program. The excitement and
    satisfaction level of these scientists is high. As a result, the
    laboratories are attracting some of the best new scientists in the
    field to participate in these experiments, particularly in the
    disciplines of shock physics and radiation transport--both key areas of
    expertise in nuclear weapons science. Other areas of Stewardship
    activity are similarly vibrant and important. The Z-pinch success is a
    useful, but not a dominant factor in attracting and retaining
    scientists for Stewardship.
                        funding for stockpile management
        Question. The stockpile management program supports the enduring
    stockpile by assuring the availability of adequate supplies of tritium;
    provides safe and secure storage of nuclear materials and components to
    prevent proliferation; provides the ability to respond to potential or
    real weapons incidents or accidents, and the capability to respond to
    evolving nuclear terrorist threats; and provides a flexible
    infrastructure capable of supporting changing stockpile size.
        The goals of the program are to: provide high confidence in the
    safety, reliability and performance of the enduring stockpile without
    nuclear testing; ensure the effectiveness of the U.S. nuclear
    deterrent; and provide the ability to resume underground nuclear
    testing and reconstitute nuclear weapons production capacities should
    national security demand them in the future.
        The total budget request for Stockpile Management is $1.998
    billion, a reduction of $48 million below the current year funding
    level. However, the details reflect a significant reduction in the
    dismantlement of retired nuclear weapons (down 36 percent or $23
    million); and the core stockpile management program (down 4 percent or
    $68 million).
        Dr. Reis, does the reduction in the Stockpile Management program
    concern you?
        Answer. I would be concerned with the safety and reliability of the
    stockpile at any funding level. It is my job to be concerned. That
    said, the budget request for Stockpile Management is sufficient to
    address all critical needs.
        Question. What will be the adverse impacts resulting from the
    reductions in various elements of the Stockpile Management Program?
        Answer. To manage within the Stockpile Management Program budget,
    we have reduced funding for the dismantlement program which may be
    reflected in a reduced workforce. Our goal is to manage employment
    level reductions through attrition as much as possible.
        Question. Which elements have been reduced to the point to give you
    major concern? Please explain why.
        Answer. Again, as I have said, I would be concerned with the safety
    and reliability of the stockpile at any funding level. Among my current
    concerns are that we renegotiated several of the workload commitments
    to the Air Force and Navy. None of these adjustments will reduce the
    safety or reliability of the stockpile. These renegotiations will,
    however, continue to push out work into later years. Secondly, we must
    work to develop a multi-year budgeted modernization program at the
    plants. We do not have all of the manufacturing capabilities that are
    critical to extending the life of the nuclear weapons stockpile. We
    plan to start to reestablish these capabilities as part of an
    integrated plant modernization program in the fiscal year 2001 budget.
    Lastly, we are concerned with maintaining plant critical skills as we
    continue to experience manpower reductions. A large majority of the
    current workforce will be of retirement age within the next few years.
    This is the labor force that has the experience of building nuclear
    weapons. It is critical that we undertake our Stockpile Life Extension
    Program while this labor force who knows how to build weapons is still
    available. This problem is exacerbated by the fact that manpower
    reductions have made it difficult to retain junior level people to gain
    these skills for future requirements and to attract new personnel. The
    Commission on Maintaining United States Nuclear Weapons Expertise
    recognizes the problem and made various suggestions including
    incentives to retain personnel at retirement and attract new personnel.
                       reestablishment of pit production
        Question. Over the past several years, DOE has been working to
    reestablish plutonium pit manufacturing at Los Alamos to replace pits
    destructively tested in the surveillance program and to replace pits in
    the future should surveillance indicate a problem with a pit. This is a
    critical element of DOE's production complex reorganization.
        Could you update the committee on DOE's efforts to reestablish pit
    production at Los Alamos? Are you still on schedule to achieve an
    annual production capacity of 20 pits by 2007?
        Answer. The DOE is on schedule to deliver a certified W88 warhead
    to the stockpile in fiscal year 2001 which is required to achieve a
    manufacturing capacity of 20 pits per year by fiscal year 2007.
        Currently, we are manufacturing development units to refine the
    processes to be used in production. Two development units have been
    completed and a third is scheduled for assembly in the near future.
    Manufacture of development units will continue into the beginning of
    fiscal year 2000. Once the processes, tooling, and qualification
    infrastructure are fully in place (much of which is being accomplished
    in fiscal year 1999), manufacture of qualification units will begin in
    fiscal year 2000. Qualification testing (to insure processes,
    procedures, and tooling can meet the consistency and product
    reliability of manufacturing and design specifications) will then be
    initiated. Achieving the capacity of manufacturing 20 pits per year in
    a reliable and sustained manner will require additional manufacturing
    equipment and facility improvements to both the plutonium facility and
    supporting facilities.
        Question. Have you been able to produce a certifiable pit? What
    problems or issues remain to be resolved in order to achieve
    certification?
        Answer. We are scheduled to produce a certifiable W88 pit in fiscal
    year 2001. Currently, there are no specific problems or issues with
    regard to certification, but much remains to be done. A number of
    qualification, engineering, and physics tests must be conducted to
    achieve certification.
        Currently, we are manufacturing development units to refine the
    processes to be used in production. Manufacture of development units
    will continue into the beginning of fiscal year 2000. Once the
    processes, tooling, and qualification infrastructure are fully in place
    (much of which is being accomplished in fiscal year 1999), manufacture
    of qualification units will begin in fiscal year 2000. At this time
    qualification testing (to insure processes, procedures, and tooling can
    meet the consistency and product reliability of manufacturing and
    design specifications) will be initiated. Engineering and physics
    testing will continue to confirm that performance of the newly
    manufactured pits are equivalent to those currently in the stockpile.
        Question. How does the budget request for fiscal year 2000 advance
    your efforts to reestablish this capability, and does the budget
    request maintain the 2007 date for producing DOE's goal of 20 pits per
    year?
        Answer. The budget request for fiscal year 2000 enables DOE to
    continue to reestablish a pit manufacturing capability and to conduct
    qualification, engineering, and physics tests required to certify newly
    manufactured pits for entry into the nuclear weapons stockpile and to
    establish a 20 pits per year capacity by 2007.
        On the manufacturing side, the budget request allows continued
    development of processes, tooling, and procedures necessary to
    manufacture the pits, and actual manufacture of W88 qualification pits.
    The budget also supports replacement of older laboratory equipment with
    new equipment required to manufacture twenty pits per year.
        For certification, the budget request provides funds for
    qualification, engineering, and physics tests to continue. In fiscal
    year 2000, qualification testing (to insure processes, procedures, and
    tooling can meet the consistency and product reliability of
    manufacturing and design specifications) will be initiated. Engineering
    and physics testing begun in fiscal year 1999 will continue.
                               tritium production
        Question. In December of last year, the Secretary of Energy
    selected the commercial light water reactors for tritium production,
    and designated the linear accelerator as ``backup'' technology if
    needed sometime in the future. What was the basis of the Secretary's
    decision to select the commercial light water reactor? What major
    hurdles remain that could slow down or derail the use of commercial
    light water reactors as a tritium source?
        Answer. After spending a great deal of time considering the
    alternatives, the Secretary determined that the use of Tennessee Valley
    Authority reactors offers the lowest technical and schedule risk, and
    the lowest cost of the options under consideration. At the same time,
    the Secretary designated TVA's existing Watts Bar and Sequoyah reactors
    as the preferred facilities for tritium production rather than
    investing in the completion of TVA's unfinished Bellefonte Unit 1
    reactor. The use of existing reactors offers unique advantages over any
    other tritium supply option including significantly lower investment
    costs and potentially the lowest life cycle cost. It is the only option
    that avoids a large capital expenditure on a major new weapons facility
    at a time when we are pursuing further arms reductions. It is the only
    option that allows us to proceed on a pay-as-you-go basis, allowing the
    Department to buy only what it needs. Because TVA has agreed to a cost-
    based Economy Act transaction, the annual costs will be low,
    particularly so if the options are not exercised and the reactors
    remain in a stand-by mode.
        Assuming that adequate funding is provided and Congress places no
    additional restrictions on the project, there are no ``major hurdles''
    that would slow or derail the project.
        Question. Now, I understand that the NRC must provide regulatory
    approval in order to use a commercial reactor for tritium production,
    is that correct? What is the date that you must have NRC approval in
    order to meet the 2005 availability date of tritium? Have the DOE and
    NRC established firm schedules and major milestones to meet DOE's need
    date?
        Answer. The NRC must approve amendments to the facility operating
    licenses for Watts Bar and the Sequoyah reactors in order for them to
    use the burnable absorber rods designed by DOE, rather than the
    standard burnable absorbers used. TVA must obtain NRC approval for
    these license amendments in time to insert the tritium-producing
    burnable absorber rods into the Watts Bar reactor core in early fiscal
    year 2004 and into the core of one of the Sequoyah reactors a few
    months later.
        DOE and TVA estimate that the application for license amendments
    for Watts Bar and Sequoyah will be completed and submitted to the NRC
    about 14 months from now, about the middle of calendar year 2000. The
    NRC Chairman has committed that the agency will expeditiously review
    these license amendment applications. DOE and TVA expect,
    conservatively, that by the middle of 2002 the NRC will be in a
    position to act favorably upon the amendment requests. That expectation
    is based upon an assessment of the activities that are involved in the
    review and approval of license amendments by the NRC including the
    confirmatory demonstration just completed at the Watts Bar facility.
        Question. I believe the Secretary stated that the commercial light
    water reactor was the most consistent with U.S. arms reduction goals.
    Can you explain why the Department believes this to be the case? Does
    the Administration believe that the commercial light water reactor
    option is also best suited to meet U.S. nonproliferation goals, and if
    so, why?
        Answer. On balance the Administration believes that the commercial
    light water reactor (CLWR) option is best suited to meet U.S.
    nonproliferation goals. The CLWR option entails the use of a civilian
    reactor to produce material for use in nuclear weapons, departing from
    the long-standing principle of maintaining a distinction between U.S.
    civil and military activities. Such distinction, however, is not
    mandated by law with respect to tritium production or by treaty; there
    have been many past exceptions involving dual-use facilities; and a
    number of factors will mitigate the impact on U.S. nonproliferation
    efforts.
        These mitigating factors include the fact that the reactor to be
    used for tritium production belongs to TVA, a U.S. government
    instrumentality with a long history of supporting U.S. defense needs;
    the fact that the reactor could remain eligible for (and be compliant
    with) International Atomic Energy Agency (IAEA) inspections; and the
    fact that implementation of this option could be delayed until
    necessitated by tritium demand, which could be reduced through
    additional arms control treaties.
        The accelerator option does not transgress the civil/military
    dichotomy, but it could not follow possible future reductions in
    tritium requirements as efficiently. The substantial early investment
    in an accelerator specifically built for military purposes, moreover,
    could be seen as building up U.S. nuclear weapon production
    capabilities at a time when the U.S. is seeking to reassure non-nuclear
    weapon states that it is committed to nuclear arms reductions. This
    could weaken U.S. bargaining positions in such fora as the 2000 Non-
    Proliferation Treaty Review Conference.
        Question. What are the Department's plans for an orderly close out
    of the accelerator, including associated target design, tritium
    separation and balance of plant design? What is DOE's funding profile
    to complete this work?
        Answer. In accordance with Presidential guidance and in keeping
    with the Department's commitment to have a backup technology, DOE will
    complete the development and demonstration work and the preliminary
    design of the APT plant. All of the components mentioned are included
    in that work. The project will provide a final report to the Department
    with all of the technical information and the preliminary design that
    will allow the Department to finish the design and build a plant should
    that ever be required.
        This effort will require $88 million in fiscal year 2000 and a
    total of $172 million between fiscal year 2000 and fiscal year 2002, at
    which time the project will be completed. The current profile (pending
    completion of a detailed re-planning), with fiscal year 1999 as a
    reference, is shown in the table below.

                  ACCELERATOR PRODUCTION OF TRITIUM FUNDING FOR FISCAL YEAR 1999 THRU FISCAL YEAR 2002
                                             [Escalated dollars in millions]
    ----------------------------------------------------------------------------------------------------------------
                                                                                     Fiscal year
                                                                ----------------------------------------------------
                                                                                                          2000-2002
                                                                   1999      2000      2001      2002       Total
    ----------------------------------------------------------------------------------------------------------------
    Operating..................................................       $85       $57       $35       $23         $115
    Capital....................................................        20        31        26  ........           57
                                                                ----------------------------------------------------
          Total APT............................................       105        88        61        23          172
    ----------------------------------------------------------------------------------------------------------------

                           independent project review
        Question. Over the past few years, the committee has been working
    with the House Energy and Water Subcommittee and the Department to
    establish an independent project review process for capital
    acquisitions by DOE. The committees felt that this was necessary
    because of major cost overruns and changes in a project scopes which
    have resulted to significant schedule delays and increased projects
    costs. Over the past several months, DOE has been completing and
    transmitting to the Congress independent project reviews which assess
    the readiness of particular projects to proceed to construction. These
    reports have indicated varying states of readiness at the Labs to begin
    construction of projects funded in prior years.
        The budget request for fiscal year 2000 includes 3 new construction
    starts for the Stockpile Stewardship program and 1 new start under Non-
    proliferation and Verification R&D.
        Dr. Reis, the fiscal year 2000 budget includes funding for 3 new
    construction starts under Stockpile Stewardship. The evidence from the
    independent project reviews submitted to the Congress gives a mixed
    picture of DOE readiness to initiate project construction. What actions
    have you taken to insure that projects are thoroughly reviewed for
    missions needs; that scope, costs and schedules are firm and clearly
    established; and that quality project management personnel are in place
    at the Labs and within DOE?
        Answer. We have instituted measures to ensure that the three new
    construction starts for Stockpile Stewardship are thoroughly reviewed
    to confirm that they are ready to proceed. External Independent Reviews
    on site have already been scheduled for the three new projects in the
    fiscal year 2000 budget request. These reviews will focus on mission
    need and project cost, schedule and scope baselines.
        We are planning preparatory readiness reviews for each project that
    will be led by DP staff with project management expertise who are
    independent of line managers, and include members from the U.S. Army
    Corps of Engineers, other agencies, and contractors with cost and
    management expertise. These reviews identify areas needing improvement,
    and ensure that the projects are ready for the external assessments,
    including mission need and scope, cost and schedule baselines.
        We are in the process of placing experienced project management
    personnel in place at the labs and within DP for these and other
    projects. A survey of the qualifications of all project management
    personnel is under way to support that process. In addition, DP will
    work with the Department on its recently proposed certification program
    and related training for project managers.
        Question. Now there have been significant problems at Los Alamos in
    the past related to establishing firm project scopes, and keeping
    projects on schedule. Specifically, what has or is being done at Los
    Alamos to strengthen their construction oversight and project
    management practices?
        Answer. Defense Programs has made significant efforts to strengthen
    construction oversight and project management at Los Alamos. The
    Department and the Los Alamos National Laboratory (LANL) conducted a
    construction projects management assessment in 1997 and concluded that
    there was a need for better project baselines, management, and control
    systems. Bases on this assessment, the Department and LANL developed an
    Action Plan to management construction projects. In July 1997, the
    Nuclear Construction Project Office was established at the Albuquerque
    Operations Office to provide a single field line management
    organization to provide management and oversight of stockpile
    management projects at LANL.
        Formal agreements between the Department and LANL are completed on
    each project to define their respective roles, responsibilities and
    accountability; the project baselines and management systems that will
    be employed during project execution; and the specific programmatic
    objectives that must be met by each project. A more rigorous and formal
    project authorization system has also been put into place providing
    improved funds control, definition of project deliverables, and
    supporting documentation. This enables management to ensure that
    appropriate resources are in place to support construction project
    activities
        An integrated review process has been developed which ensures
    program, project, and safety objectives are quantified and achieved
    through technical review and decision processes. Integration between
    program and construction project activities is supported by plans that
    integrate programmatic work with equipment installations and
    construction activities.
        Question. One of the new construction starts is a new $106 million
    Strategic Computing Complex at Los Alamos. When will the Independent
    Project Review be completed for this project? What specific actions
    will you take to ensure this project is managed to critical schedules,
    and that cost management is critically reviewed?
        Answer. The independent assessment for the Strategic Computing
    Complex is scheduled to begin on April 12, 1999, with a final report to
    Congress by the end of May, 1999, although some slippage may occur due
    to other ongoing reviews. Additionally, a readiness review for the
    Strategic Computing Complex will begin on March 29, 1999, and will be
    completed before the independent assessment begins.
        In terms of project management, Defense Programs has revised the
    way construction projects are managed. These revisions are based upon
    critical analysis of the program and utilize many of the attributes
    that have been successfully employed in projects such as the National
    Ignition Facility. Key changes include the creation of small project
    teams with clear, unambiguous roles, responsibilities, and appropriate
    authority to execute the projects; organizational changes to ensure
    senior management monitoring of the baselines; and an interim
    qualification of all project management team members.
        Los Alamos National Laboratory has taken additional steps to
    improve the management of this project by hiring a professional
    construction project management firm to assist them in the oversight of
    the ``design and build'' contractor. They have also hired a
    professional engineering firm to assist them in their reviews of
    mechanical systems. The addition of these two external groups will
    significantly enhance the strength of the Laboratory's management team
    on this project.
          chemistry and metallurgical research (cmr) building upgrade
        Question. The Department has been struggling with upgrades to the
    CMR building at Los Alamos for many years. This facility, built in the
    1950s, undertakes important analytical work related to plutonium,
    uranium, and other alloys and materials in support of the weapons
    program. The project has been plagued with constant scope changes, cost
    increases and significant schedule delays. The Department has had a
    difficult time determining how to proceed with the project which has
    been suspended for the past few years in an effort to determine firm
    baselines of scope and costs for the CMR facility upgrade project.
        Explain the Department's decision and plans for the CMR building at
    Los Alamos. Why was the decision made to proceed with upgrades of the
    existing facility, which was constructed in the 1950s and sits on an
    earthquake fault, instead of constructing a new facility?
        Answer. In 1988, the Special Nuclear Materials Laboratory (SNML)
    project (88-D-105) was authorized to replace the CMR Building to
    support continued weapons production and certification. In 1991, the
    long term mission of the SNML became uncertain as weapons production
    ceased and there was uncertainty relative to the amount of work
    involving plutonium material which CMR would be required to support in
    the coming years. Therefore the Department decided not to proceed with
    construction of the SNML, but provide interim upgrades to the CMR.
    These upgrades were initiated in 1992 and later designated as Phase 1.
    In addition, studies were conducted to determine further upgrades
    required for continued long-term operations (later designated Phase 2).
    In 1995, the Department opted to initiate Phase 2 of the CMR Upgrades,
    bringing the Total Estimated Cost for the entire project to $174.1M,
    and cancel the SNML project.
        It has only been in the past year that ongoing geologic studies
    have revealed the presence of a seismic fault running under the North
    side of the CMR facility. Because of the geologic information, the
    project has been refocused on completing only those upgrades necessary
    to maintain safe and reliable operations in the facility through fiscal
    year 2010. The Department is examining the activities at CMR to
    determine where these activities should be conducted in the future.
        Question. How important is the CMR facility to the defense mission
    of DOE? What role will this facility play in carrying out the defense
    mission of DOE?
        Answer. The capabilities of CMR are essential to DOE's defense
    mission. The CMR facility is the only laboratory facility with full
    capability for performing analytical chemistry and materials science
    for special nuclear materials. The CMR is critical to the Stockpile
    Stewardship Program in pit surveillance, pit manufacturing, stockpile
    lifetime extension, and nuclear weapons certification. Analyses
    performed at CMR assure that specifications for plutonium are met in
    pit production and pit surveillance.
        Question. How do you plan to use the $18 million requested for
    fiscal year 2000?
        Answer. The fiscal year 2000 budget request provides $18 million
    for completion of facility upgrades necessary to meet the safety and
    regulatory requirements for continued CMR operations. These
    requirements, and their scheduled implementation, have been formally
    defined and prescribed by the approved CMR safety authorization basis--
    the Basis for Interim Operations. These high priority safety upgrades
    are necessary to reduce CMR operational risks to the public and workers
    in the near-term, and to operate the CMR facility safely through fiscal
    year 2010. To meet the safety and regulatory requirements, the majority
    of the safety upgrades have been initiated in fiscal year 1999, and
    fiscal year 2000 funding will allow the design and construction of
    these upgrades to continue. If these upgrades are not completed as
    scheduled, the CMR facility operations will be severely curtailed or
    suspended.
        Question. What steps and actions has the Department taken at the
    field and headquarters level to ensure that the project does not
    experience further scope changes and costs increase once work proceeds?
        Answer. In the spring of 1997 the Department initiated an in-depth
    review of project management issues at the Los Alamos National
    Laboratory (LANL) as they related to the stand down of the CMR Upgrades
    Project. The review identified root causes, contributing factors, and,
    when put into place, corrective actions that will address systemic
    institutional performance problems and as well as construction project
    deficiencies. An external independent assessment was also conducted in
    August 1998 and a number of findings and recommendations were made,
    which again reflected the issues previously identified in 1997.
        While corrective actions have been initiated on the basis of both
    institutional and project-specific issues, both the DOE and LANL have
    taken other actions to assure control over project scope, schedule, and
    cost. Significant organizational changes have occurred to put senior
    management focus on corrective measures and to assure project
    accountability. Technical expertise has been expanded both within the
    project and within engineering support offices. Procedures and other
    management tools have also been improved to increase project control.
    All findings and recommendations from previous assessments/reviews,
    including the two mentioned above, have been captured as part of an
    Action Plan (AP). The AP details both the institutional and project-
    specific correction actions to be taken to address the findings and
    recommendations. The AP is being used to establish baselines for
    several stockpile management construction projects and to strengthen
    project management oversight of milestones and cost. Project baselines
    and stronger oversight will enable management to ensure that
    appropriate resources are in place to support construction project
    activities. In addition, the Stockpile Management program established
    the Nuclear Construction Projects Office (NCPO) at Albuquerque to
    integrate and strengthen oversight of all the program projects at Los
    Alamos. Staffing was increased and roles and responsibilities were
    clarified between the NCPO, Los Alamos Area Office, and LANL.
                            idaho operations office
        Question. I notice that funding for the Idaho Operations Office is
    being reduced significantly below the fiscal year 1999 funding level?
    Why is this?
        Answer. In fiscal year 2000, support will continue for the
    Radiological Assistance Program of approximately $400 thousand per
    year. The DP tasks supported by the Idaho National Engineering and
    Environmental Laboratory under the umbrella of the Idaho Surety Program
    will either be completed in fiscal year 1999 or have been refocused
    into areas outside of Idaho's expertise. This is the case with the task
    supporting the Advanced Design and Production Technologies initiative,
    the program has refocused its priorities from modeling efforts to the
    development of processes and tools specifically required to support the
    Stockpile Life Extension Program.
                           use of prior year balances
        Question. Last year there was sizeable controversy regarding the
    expected level of unobligated balances within the Weapons Activities
    budget. If I recall correctly, the House reduced the program by several
    hundred million dollars based on information developed by GAO on
    projected levels of unobligated funding.
        Could you review for the committee last year's situation and update
    us on where the program ended up as it relates to unobligated balances?
    How did the balances carried over into fiscal year 1999 actually
    compare to GAO's estimate and Defense Programs' estimates?
        Answer. Last year, reports from the authorizing and appropriations
    committees specified that Defense Programs should use prior year
    balances, ranging from a low of $50 million to a high of $341 million,
    to offset the need for new budget authority to fund the fiscal year
    1999 program. The final appropriation directed that the fiscal year
    1999 program be financed using $4.4 billion in new budget authority and
    $82.5 million in prior year balances.
        The controversy arose because the information developed by the GAO
    and provided to the committees differed significantly from DP's
    analysis. GAO reported to the committees that DP would have up to
    $340.7 million in ``excess'' balances at the end of fiscal year 1998,
    while DP's estimates indicated that little or no excess uncosted
    balances were expected, and $49.4 million for unobligated balances. The
    actual end-of-year unobligated balances for direct programs in the
    Weapons Activities account were $46.6 million.
        Question. Now, the final appropriations bill used some $82.5
    million of prior year balances to finance the fiscal year 1999 budget.
    Were these balances available? If the balances were not available, what
    adjustments were you forced to make?
        Answer. No. There was not $82.5 million in excess prior year
    balances available to finance the fiscal year 1999 budget. We plan to
    obligate $4.447 billion in fiscal year 1999, which includes $28.6
    million for program scope justified and approved in prior years but
    delayed until fiscal year 1999. The balance, $4.418 billion, represents
    obligations for new workscope composed of $4.4 billion in new
    appropriations, and $18 million in prior year balances.
        In an effort to implement the guidance in the appropriation, which
    directed that fiscal year 1999 activities be funded using $4.4 billion
    in new budget authority and $82.5 million in prior year balances,
    Defense Programs undertook a rigorous process to examine all prior year
    balances reported at the end of fiscal year 1998. Since overall ending
    fiscal year 1998 uncosted balances for Defense Programs were well below
    the Department's goal for operations and maintenance activities, there
    was little flexibility to use these funds against fiscal year 1999
    requirements. Only about $18 million was available from unobligated and
    uncosted balances to be redirected without unacceptable impact to
    ongoing program activities. Therefore, we will only execute program
    level that falls $64 million below the level outlined in the conference
    report accompanying the 1999 appropriation.
        Question. If I understand your budget, you were forced to make some
    $64 million in program reductions because there was only a little over
    $18 million of prior year balances available. How was the $64 million
    reduction allocated by specific activity, and did this result in any
    adverse impacts?
        Answer. To arrive at the current program and site allocations, we
    accommodated first all congressional direction contained in the
    appropriation and authorization bills and reports on fiscal year 1999
    programmatic and site funding, and then assessed the reduction
    proportionally to each Defense Programs decision unit. Much of the
    reduction has been accommodated by small slips to work schedules,
    procurements and maintenance with no significant adverse impacts.
         office of counterintelligence fiscal year 2000 budget request
        Question. The fiscal year 2000 budget request for the Office of
    Counterintelligence requests funding of $18.6 million with another
    $12.6 million in additional funding to come from the national
    laboratories from other Defense programs to be spent by the Office of
    Counterintelligence. Why did you find it necessary to ``tax'' other
    programs for additional funds?
        Answer. The Counterintelligence (CN) program for fiscal year 2000
    is a $31.2 million program. All of the $31.2 million will be under the
    management purview of the Office of Counterintelligence. However, it is
    composed of two pieces. The first is direct funding of $18.6 million
    which is for costs primarily related to central counterintelligence
    activities. The second portion, $12.6 million, is not a tax rather it
    is an estimate of the activities the laboratories will need to fund to
    better cover their counterintelligence responsibilities under the
    direction of the Office of Counterintelligence.
        Question. Specifically, where will the $12.6 million come from?
    Provide for the record a list by site of how the $12.6 million will be
    assessed.
        Answer. The funds will come from the laboratories that need to make
    additional expenditures to cover their counterintelligence
    responsibilities. This includes primarily the three weapons
    laboratories, but some additional expenditures will be required at
    other laboratories as needs for enhancements in counterintelligence are
    identified. The character of the improvements necessary will dictate
    whether these costs to be borne by the laboratory are from direct
    program funding or from overhead. The counterintelligence program is
    sending a team out to the laboratories in April and one of their
    responsibilities will be to get an estimate by site and activity of the
    expenditures necessary. When the information is complete, we will
    provide it to the Committee.
                            presidential initiative
        Question. Ms. Gottemoeller, three years ago, I considered the
    programs you oversee to be critical to U.S. national security. What I
    have come to realize since the collapse of the Russian economy, since
    the IMF and the World Bank have pulled out, and now that Yelsin's power
    is in serious question, is that your programs are the centerpiece of
    U.S.-Russian relations. I've met with the President's national security
    staff to discuss the President's Russia initiative, and I agree
    something has to be done since Russia cannot fulfill its obligations
    under many of our bilateral agreements. But I only see a few very small
    increases in your programs. Can you tell me how the President's
    initiative affects the programs you oversee?
        Answer. The President's initiative is a positive step for the
    programs I oversee. His five year plan provides additional resources to
    what I consider to be one of the United States' top national security
    threats: nuclear proliferation.
        In the area of nuclear security in Russia and the Newly Independent
    States, the President's Expanded Threat Reduction Initiative will keep
    the Materials Protection, Control, and Accounting (MPC&A) Program's
    budget at a more sustained level than previously planned and will help
    to provide a more vigorous level of effort during the next five years
    of the program's implementation. The President's Russia initiative
    provides the MPC&A program with funds to address the expanding mission,
    including work at additional Russian navy and civilian sites with
    weapons usable nuclear material; emergency measures and long term
    operations efforts; and nuclear material consolidation. The President's
    initiative will provide top level support for these measures and enable
    the MPC&A program to undertake these new, key projects to improve
    nuclear materials security and simplify the nuclear materials problem
    in Russia.
        Other key programs affected by the President's initiative are the
    Initiatives for Proliferation Prevention (IPP) and the Nuclear Cities
    Initiative (NCI) programs. The President's initiative foresees
    providing funding support at the $30 million level annually for each
    program through 2004. Each is integral to the initiative and promotes
    the initiative's objectives. The two programs, while both addressing
    nonproliferation in the former Soviet Union, are complementary, but
    different. Let me explain the two programs in more detail.
        IPP addresses chemical, biological, and nuclear nonproliferation
    issues in Russia, Ukraine, Kazakhstan and Belarus. It seeks to prevent
    the drain of expertise from former Soviet weapons of mass destruction
    institutes to countries of proliferation concern by engaging scientists
    and engineers working at those institutes in cooperative projects with
    DOE National Laboratories. The purpose of these projects is to verify
    technical feasibility and identify Newly Independent States (NIS)
    technologies for commercialization in partnership with U.S. companies.
    The hallmark of the IPP program in the NIS is the scientist-to-
    scientist interface, which is enabled through firm, fixed-price
    contracts between the NIS laboratories and the DOE National
    Laboratories. These contracts assure stringent oversight of the
    projects at the NIS institutes. In addition, the project proposals
    themselves are reviewed by the U.S. Government interagency community
    for dual-use and policy concerns. For projects where technical
    feasibility is verified and demonstrated, the project is moved to a
    second stage, a three-way partnership involving a U.S. industry
    partner, a DOE National Laboratory, and an NIS institute. Finally,
    through the development of free-standing businesses or product lines,
    long-term economic outcomes, in terms of royalties and jobs, are
    created for the NIS scientists and engineers involved. IPP has funded
    over 400 projects in total, of which 84 are cost-shared with U.S.
    industry. Several of the IPP projects have reached the point of full
    commercialization.
        The NCI focuses on job creation for scientists and technicians who
    are being shed from the Russian nuclear weapons complex as a result of
    downsizing. It is taking place in the ten closed nuclear cities of
    Russia, starting with just three--Snezhinsk, Zheleznogorsk, and Sarov.
    Extension to other closed cities, planned for the second year, will be
    guided by lessons learned during the first year of engagement at the
    first three cities. These were chosen because IPP, and before that, the
    DOE lab-to-lab program, had engaged extensively with these cities and
    developed contacts. While IPP operates in the institutes of the closed
    cities, NCI operates in the more open municipal areas, engaging the
    new, post-Soviet political and civic leadership and encouraging the
    development of the non-weapons economy. In these areas, its efforts
    include such measures as infrastructure development, creation of low
    capital requirement businesses, and business/entrepreneurship training.
    NCI has only recently been authorized to obligate funding, and so the
    first NCI activities are now being funded in the three closed cities.
              materials protection control and accounting (mpc&a)
        Question. You know that I have had some very serious concerns about
    the management of some of your programs; Materials Protection and IPP
    in particular. I know you have made changes, and those programs now
    report directly to you. I understand that the number of sites that need
    to be secured is much higher than the original estimate. How long do
    you think this program will need to continue?
        Answer. The Materials Protection, Control and Accounting program
    based its original completion date on data contained in the 1995 Joint
    Atomic Energy and Intelligence Committee (JAEIC) Report. The report
    identified 80-100 buildings in the Former Soviet with weapons grade
    nuclear material which required rapid upgrades. The program determined
    that upgrading these 80-100 buildings would require a sustained effort
    through 2002. However, since the 1995 JAEIC Report, the program has
    greatly expanded due to improved knowledge of and access to sites and
    buildings containing weapons usable nuclear materials. To date, the
    program has identified approximately 400 buildings requiring upgrades
    at 55 sites. We also have expanded the work with the Russian Federation
    Navy to include all sites with fresh nuclear fuel and naval spent fuel
    of proliferation concern. Our initial planning did not project such
    excellent cooperation with or access to so much of the Russian Naval
    complex. Also, economic and political uncertainties in Russia during
    1998 made security of the nuclear material more difficult and have
    slowed some work.
        While the harsh Russian economic conditions have increased the risk
    of theft of nuclear materials, it also has created new opportunities to
    address proliferation risks. For example, the program is initiating a
    material consolidation program to simplify the nuclear security problem
    by moving material into fewer buildings at fewer sites. Prior to this
    crisis, this innovative approach would have been less likely to be
    supported by the Ministry of Atomic Energy (MINATOM). The recent
    violent acts at MINATOM and Russian Naval nuclear installations have
    promoted a more proactive approach by the Russian Federation to reduce
    the size of the problem. We are now actively working with the Russian
    Federation to develop a strategy to consolidate nuclear material into
    fewer buildings at fewer sites.
        Today, the program is still on track to complete rapid upgrades at
    100 of the most vulnerable buildings by the 2002 targeted date.
    However, in light of the expanded work, we are currently updating the
    plan. Our new estimate of 400 buildings requiring upgrades will likely
    be adjusted downward if we are able to undertake a vigorous
    consolidation effort with the Russians, which we fully expect at this
    time. Thus, as we develop our new work plan, we are necessarily
    factoring in some uncertainties. The President's Expanded Threat
    Reduction Initiative shows the program extending through fiscal year
    2004, but work may be required beyond that time. We will keep you
    informed as our new work plan develops.
        Question. Russia has now offered to work with us to consolidate the
    nuclear material in Russia. Have we reached an agreement on that
    proposal?
        Answer. Material consolidation is a new element to the Material
    Protection, Control, and Accounting Program and is under discussion
    currently. We are exploring opportunities with the Russian Federation
    to consolidate nuclear material into fewer buildings at fewer sites to
    simplify the nuclear security task and also possible blend down of some
    of the excess highly enriched uranium to low enriched uranium. At this
    time, we have not finalized the proposal, but we are working with the
    Russian Federation Ministry of Atomic Energy to develop a strategy and
    a proposal that will work towards consolidating nuclear material in the
    near future.
        Question. Do we know how much material the Materials Protection
    program has secured?
        Answer. The Materials Protection, Control, and Accounting Program
    is improving the security on approximately 400 metric tons of weapons
    usable nuclear material by installing initial rapid upgrades, such as
    delay barriers, access control and portal monitors. Of this amount, we
    have completed the installation of fully integrated material
    protection, control and accounting systems for approximately 30 metric
    tons.
        Question. I also am aware of the conflict between some of your
    managers and the leadership of the labs over the Materials Protection
    program. Both sides make good points, but are you aware of that problem
    and are you taking steps to resolve it?
        Answer. Our MPC&A program was originally established as a temporary
    task force, but work in Russia has proven to be much bigger, tougher
    and longer-term than anyone would have expected when we began in 1994.
    The Russian economy has not improved, and in fact has gotten worse. The
    size and geographic span of the Russian nuclear material storage
    complex is greater than anyone in the United States knew. I took steps,
    as Director of our Office of Nonproliferation and National Security, to
    establish a more permanent management structure for our nuclear
    security operations in Russia and the MPC&A Task Force. Now the MPC&A
    Task Force is reporting to me directly, and I have brought on board a
    senior State Department official to advise me and the Department on new
    approaches to manage the MPC&A program and other Russian programs. I
    expect these changes will dramatically improve the oversight and
    implementation of this extremely important program and provide for a
    more efficiently and effectively managed effort. Our goal is to further
    increase the successes and effectiveness of the MPC&A program in Russia
    through this change.
          gao report on initiatives for proliferation prevention (ipp)
        Question. Ms. Gottemoeller, the GAO has issued a report critical of
    the IPP program. How do you respond to the complaint that Russian
    scientists who receive support from the IPP program may work on dual-
    use technologies or may even continue to work on weapons technologies
    when they are not working on IPP projects?
        Answer. The Department and General Accounting Office (GAO) do not
    agree on this issue. GAO claims that some Initiatives for Proliferation
    Prevention (IPP) projects support the development of ``dual-use''
    technology that may enhance Russian military capabilities. The cases
    cited by GAO provided no direct aid to Russia's military or weapons of
    mass destruction programs. Moreover, DOE has been extremely concerned
    about this issue and reinforced the existing review process in the mid-
    1997 time frame. This reinforcement enhanced interagency participation
    in the review process, to screen out potential ``dual-use'' projects--
    especially in the areas of chemical and biological weapons.
    Nevertheless, we have implemented GAO's recommendations to further
    strengthen the review process.
        IPP is not subsidizing Russian weapons activities, as GAO contends,
    because each project is designed to produce non- defense products and
    results in one or more specific deliverable. The deliverables are
    reviewed by a U.S. laboratory principal investigator who verifies that
    these meet the original terms of contract requirements. We take this
    oversight very seriously. DOE scientists spent the equivalent of ten
    man-years in the NIS in fiscal year 1998 alone, ensuring that IPP
    projects were being properly conducted, according to firm, fixed-price
    contracts. Time spent by Russian scientists on these non- defense IPP
    contracts is time that they cannot spend working on Russian weapons
    projects--or on weapons of mass destruction programs for third parties.
        We know that senior Russian weapons scientists are devoting time to
    their IPP projects, because we are receiving work products, reports,
    equipment prototypes, and other deliverables that reflect their project
    work. Moreover, in many cases IPP program money is the only actual
    payment scientists are receiving, thus making IPP work more attractive
    to Russian participants than non-paid defense-related assignments.
        The involvement of DOE laboratory personnel with that of NIS
    scientists and engineers provides assurance that old reports and data
    from archives are not sent in as new deliverables. The direct interface
    with DOE personnel also helps ensure that IPP funds are being spent on
    IPP projects and are not diverted to other purposes at the recipient
    institutes.
        The fundamental goal of the IPP program is to keep NIS weapons
    specialists working in their home countries, rather than selling their
    services to foreign states or organizations of proliferation concern.
    At virtually all Russian weapons institutes, salaries are going unpaid
    for months. These scientists and those formerly employed at the
    institutes are the proper targets of the IPP program, because these are
    the individuals who are most likely to be tempted to sell their
    services abroad.
        GAO also raised the possibility that 19 chemical and biological
    projects had not received necessary interagency review. It has recently
    been verified by review of IPP documents and records that these 19
    projects had received necessary interagency review before their
    approval. In addition to this, the remaining IPP chemical and
    biological projects (for a total of 30) have been rechecked to assure
    that necessary interagency reviews are underway and should be completed
    by April 15, 1999.
                 initiatives for proliferation prevention (ipp)
        Question. I am interested in the GAO's finding that most of the IPP
    funds are spent at our labs and not in Russia. Would you provide to the
    Committee a break-down of the how much of the funds appropriated for
    Materials Protection and IPP is spent in the U.S. and how is spent in
    Russia?
        Answer. IPP expenditures in the United States have been high
    because of the involvement of the DOE National Laboratories--an
    involvement that is one of the core strengths of the IPP program and
    one that is mandated in the legislation founding the initiative. It is
    the close involvement of DOE National Laboratory scientists and
    engineers in the IPP projects that assures that the work done and the
    deliverables received, under firm, fixed-price contracts, are receiving
    stringent oversight. The principal investigators monitor each contract,
    collaborate with the NIS scientists and engineers, working jointly on a
    given project, participate in selecting an industry partner in the
    U.S., arrange the Cooperative Research and Development Agreements
    (CRADA) with the industrial partner, and then monitor the CRADAs.
    Often, joint publications and joint inventions result from these
    collaborative efforts.
        This crucial involvement of DOE laboratory personnel provides
    confidence that NIS scientists and engineers are not submitting old
    reports and data from their files as new deliverables. The hands-on
    involvement of DOE personnel also helps to safeguard that IPP funds are
    being spent on IPP projects and are not sidetracked for other
    activities at the recipient institutes. In fiscal year 1998 alone, IPP
    principal investigators from the laboratories spent the equivalent of
    nearly 10 man-years at facilities in the NIS ensuring that IPP projects
    were being done properly and in compliance with contract requirements.
    (It should be noted that although these days were worked in the NIS,
    the travel funds were counted as being spent in the United States, an
    accounting artifact that does not provide a full picture of resources
    devoted to work in the NIS).
        Another factor affecting the proportion of IPP funds expended in
    the United States is that IPP provides important support for other U.S.
    government programs. For example, since International Science and
    Technology Center (ISTC) funds cannot be spent in the United States,
    IPP funds are used for work at U.S. National Laboratories in support of
    ISTC work in Russia. Over the life of the Program, six IPP projects
    worth approximately $950,000 were funded in direct support to ISTC
    projects. In addition, IPP has been funding nearly $500,000 in ISTC
    salaries on an annual basis. IPP has also provided continued indirect
    support to ISTC from National Laboratory overheads and other related
    sources. DOE lab scientists are listed as `collaborators' on 238 ISTC
    projects and perform a number of activities which can include proposal
    review, review of reports and performance of hands-on research.
    Indirect support duties also include performance as program
    `coordinators' for ISTC projects for which at least partial
    compensation is received.
        Despite these factors, however, the IPP program is implementing
    changes to increase the commercial emphasis of IPP projects and to
    raise the overall proportion of project funds sent to the NIS to well
    above 50 percent. Our goal is 60 percent. This will be accomplished by
    requiring that each laboratory place more of its IPP project dollars on
    U.S. industry cost-shared projects, to which U.S. industry is
    contributing resources, as opposed to technology demonstration and
    feasibility projects not involving U.S. industry. For these U.S.-
    industry cost-share projects, an increased share of funding will go to
    the NIS. In addition, on-going technology demonstration projects that
    are not meeting project milestones or have only a slight chance of
    commercialization will be canceled and the funds made available for
    more commercially promising projects. As an aggregate, these measures
    will result in an increasing commercial emphasis, more U.S. industry
    cost-share and participation, and a greater percentage of overall IPP
    funds going to the NIS.
        For fiscal year 1997 Initiatives for Proliferation Prevention (IPP)
    appropriated funds, the DOE National Laboratories allocated $12.4
    million to the Newly Independent States (NIS). They allocated $15.5
    million to laboratory-related activities. This amounts to 44.4 percent
    of IPP project dollars allocated to NIS contracts in fiscal year 1997.
        For fiscal year 1998 appropriated funds, the allocation percentage
    to NIS contracts is projected to be 48 percent as new contracts are
    finalized. The current distribution reflects that the DOE National
    Laboratories have allocated $6.7 million or 28.2 percent to the NIS and
    $17.0 million or 81.8 percent of funds is committed to laboratory-
    related activities. As contract negotiations with NIS institutes are
    completed and costing of funds under the new contracts can begin, the
    NIS expenditures are anticipated to rise to as high as 48 percent,
    allocating a 52 percent portion in the National Laboratories.
        It is also the IPP program goal to increase the number of Thrust
    Two projects, which involve a cost-sharing with U.S. industry, as a
    percentage of overall projects underway. This will contribute, in a
    positive way, to increasing the flow of funds to the NIS partners.
        For the Materials Protection, Control and Accounting (MPC&A)
    Program, during fiscal year 1996 and fiscal year 1997, as the program
    was getting established and U.S. coordination costs were higher, the
    MPC&A program spent $107.7 million on U.S. laboratory labor and travel
    and $56.3 million on upgrades at FSU facilities, including FSU labor
    and MPC&A equipment installed at FSU facilities (this equipment was
    from FSU and Western commercial vendors). This broke down to about 66
    percent and 34 percent, respectively.
        Since fiscal year 1998 through January 1999, the MPC&A program
    costs were $100.7 million for U.S. laboratory labor and travel and $90
    million for FSU labor and MPC&A equipment. These costs amount to around
    53 percent and 47 percent, respectively. This trend is heading toward
    lower U.S. laboratory costs as the MPC&A program engages in more
    efficient management.
        It must be stressed that much of the laboratory travel associated
    with both the MPC&A and IPP programs is carried out in Russia and the
    NIS, overseeing or performing project work in inhospitable or even
    hazardous environments. Without the travel of laboratory specialists to
    these difficult and remote locations, MPC&A and IPP project work would
    not be possible.
                        nuclear cities initiatives (nci)
        Question. This year's Defense Authorization Act required a report
    on the Nuclear Cities Initiative which we have received--but it is very
    vague. Will you submit to the Committee a more detailed report so we
    can understand basic issues about the Nuclear Cities Initiative such
    as; who will serve as the United States executive agent for this
    program, where the money will be spent, or what the money will be spent
    on?
        Answer. The Department will be happy to provide ongoing status
    reports of progress under the Nuclear Cities Initiative (NCI) to the
    Committee. The Nuclear Cities Initiative has progressed considerably
    since the December report that DOE submitted to the Congress.
        DOE serves as the U.S. Executive Agent for Nuclear Cities
    Initiative on behalf of the U.S. Government.
        As reported to the Gore-Primakov Commission in March 1999,
    important initial projects are being launched in each of the three
    initial target cities, Sarov, Snezhinsk and Zheleznogorsk. Highlights
    of the current status and plans are:
        Working groups have visited each of these three cities and
    identified promising projects. One of the primary aims of the mutual
    effort will be to establish a business friendly infrastructure within
    the cities. As a start, in 1999, almost $2 million in funding will be
    devoted to upgrading the telecommunications systems and to establishing
    business development centers to promote market-based economic activity
    within each community.
        In Snezhinsk (Chelyabinsk-70), a pharmaceutical packaging project
    has been identified for joint work, leveraging resources to support
    this important activity to benefit public health and welfare. In
    Zheleznogorsk (Krasnoyarsk-26), the U.S. working group team has just
    completed its evaluation. The Silicon of Siberia project, which alone
    could result in the creation of 500 jobs over four years, will be one
    target of joint development, with other smaller projects currently
    being identified.
        Progress in the six short months since the NCI Agreement was signed
    has been impressive and both U.S. and Russian participants look forward
    to building a foundation of cooperation that will lead to sustainable
    job creation in the closed nuclear cities.
                            status of russian talks
        Question. Ms. Holgate, Deputy Secretary Moniz, Deputy Secretary
    Holum, and you briefed me in some detail on this yesterday but, for the
    record, would you summarize the status of the talks with Russia?
        Answer. The negotiations are underway. Initial conversations with
    Russian counterparts, particularly in February, reveal substantial
    common ground on a number of substantive elements as well as on the
    structure and urgency of this agreement. The U.S. delegation is led by
    the Department of State with key support being provided by the
    Department of Energy. The Russian delegation is led by the Ministry of
    Atomic Energy (MINATOM), supported by the Ministry of Foreign Affairs.
    I believe that an agreement can be concluded this year to enable
    plutonium disposition to proceed in both countries.
                       parallel u.s. and russia programs
        Question. Congress directed in last year's Act that ``the United
    States should not proceed unilaterally to dispose of excess plutonium
    without parallel progress on the Russian side.'' The budget request
    states that the Administration will not construct new facilities for
    disposition of U.S. plutonium unless there is significant progress on
    plans for plutonium disposition in Russia. When the Administration says
    ``significant progress,'' is that consistent with the Congressional
    requirement for an agreement to be in place?
        Answer. Yes. The United States will not unilaterally dispose of its
    surplus plutonium without parallel progress on the Russian side. The
    Department's fiscal year 2000 budget request for fissile materials
    disposition seeks funding to proceed with the up-front research,
    design, licensing and fuel qualification activities. Proceeding with
    these long lead-time activities is necessary to maintain momentum and
    pressure on Russia for a plutonium disposition agreement, and serves as
    a sign to private industry, the public and the world community that the
    U.S. is serious about disposing of stockpiles of surplus weapons
    plutonium. The United States will not begin construction of new
    facilities for the disposition of U.S. plutonium unless there is
    significant progress with Russia on plans for the disposition of
    surplus Russian plutonium. A comprehensive bilateral agreement would
    certainly represent ``significant progress.''
        Question. Your budget request for fiscal year 2000 includes funds
    to complete Title I and Title II design of the pit disassembly and
    conversion facility and to procure some long-lead equipment. You are
    also on the verge of issuing a contract this year with a fuel
    fabricator and utility team to fabricate and burn MOX fuel. It seems to
    me that Russia is years behind in that regard. Are you getting in front
    of Russia, and how do you plan to deal with a slow-down if the Russian
    program does not proceed quickly?
        Answer. I do not believe the United States is getting out in front
    of the Russians on this matter. Russia is currently conducting
    feasibility studies on various technical alternatives for converting
    plutonium metal to plutonium oxide, suitable for fabrication into mixed
    oxide (MOX) fuel. Following a decision by Russia, we can proceed with
    design of a full-scale Russian plutonium conversion facility. On the
    U.S. side, once we have a contract in place, we too can proceed with
    the design of the full-scale plutonium conversion facility. The
    contract for MOX fuel fabrication and irradiation services is written
    so as to allow changing the output of the MOX plant to allow for
    parallel progress with Russia.
        The U.S. contract for MOX fuel fabrication and irradiation services
    was awarded on March 22, 1999. We needed to award this contract in
    order to select and obtain commitments on which reactors would be used.
    Among other things, the first phase of this contract will include
    design of the fuel fabrication facility. Without the facility design
    and the identification of reactors, we would be unable to move forward
    with the licensing requirements for the fabrication facility and the
    reactors. Russia, on the other hand, already knows which reactors will
    be used for plutonium disposition and they have begun work on fuel
    qualification. Russia is working on a conceptual design of a MOX fuel
    fabrication facility with the French. Our Technical Cooperation
    Agreement gives us a key mechanism to keep Russian research and
    development moving ahead during the process of negotiating a
    comprehensive bilateral agreement.
        Question. Is the procurement of that long-lead equipment consistent
    with the commitment to proceed in parallel with Russia?
        Answer. Yes. In order to obtain the necessary equipment design
    information for review and use, the architect-engineer must procure the
    long-lead equipment early in the design phase, before the facility
    design is complete. However, no equipment manufacturing would begin
    unless there is significant progress with Russia on plans for plutonium
    disposition. Should significant progress be delayed, equipment vendors
    would not be authorized to fabricate hardware.
                             definition of 50 tons
        Question. Russian Minister Adamov has complained to me that the 50
    tons of plutonium the United States plans to disposition of is not all
    weapons grade. I understand that initially we will work with Russia to
    dispose of equal amounts of each country's plutonium, but, over the
    long run, Russia has a great deal more plutonium that the U.S. How are
    we going to achieve parity over the long run?
        Answer. You are correct in your understanding that under the
    bilateral agreement currently envisioned, the United States and Russia
    will likely dispose of equal amounts of plutonium and that Russia is
    believed to have a great deal more plutonium than does the United
    States. Parity in remaining plutonium stockpiles is intended to be
    addressed as part of the broader strategic arms reduction process
    (START).
        Question. Would you provide for the record a list of what plutonium
    each country possesses--in the case of Russia it will be our best
    estimate--and a list of what plutonium each side has proposed to
    dispose of?
        Answer. As specified in the DOE publication, Plutonium: The First
    50 Years (DOE/DP-0137, February 1996), the current U.S. plutonium
    inventory is 99.5 metric tons (MT). The U.S. inventory is composed of
    85.0 MT of weapons grade (less than 7 percent Pu240), 13.2 MT of fuel
    grade (more than 7 percent and less than 19 percent Pu240), and 1.3 MT
    of reactor grade (more than 19 percent Pu240). Of the 85 MT of weapons
    grade plutonium, 38.2 MT have been declared excess to national security
    needs. In addition, the Department of Energy considers 14.3 metric tons
    of non-weapons-grade plutonium to be surplus.
        The DOE publication, Materials Protection, Control, and Accounting
    (MPC&A) Program Strategic Plan (January 1998), states that experts
    believe that the former Soviet Union produced more than 150 MT of
    plutonium. In September 1997, Russian President Yeltsin announced a
    decision to remove gradually from military nuclear programs, up to 50
    metric tons of plutonium which has become available through the nuclear
    disarmament process. Thus far, Russia has provided no further breakout
    of this material.
                             mox vs. vitrification
        Question. Ms. Holgate, your program proposes to dispose of excess
    U.S. plutonium in two ways: burn it in reactors as MOX fuel or mix it
    with a ceramic, place that material in a steel can and surround the
    steel can with vitrified high-level waste. It seems to me that it will
    be relatively easy to recover the plutonium stored in steel cans,
    especially as the radioactivity of the waste around it decreases--
    something that will occur fairly rapidly. Have you determined that the
    steel can storage technique meets the spent fuel standard?
        Answer. The Department is focusing on this ``can-in-canister''
    approach for plutonium immobilization. Under this approach, plutonium
    feed materials would be converted to oxide which would be mixed with
    material to form ceramic disks. The disks would be stacked and sealed
    into steel cans which would be arrayed within large canisters into
    which vitrified high-level waste would be poured. The radioactive waste
    barrier increases the proliferation resistance of the immobilized
    plutonium. Subsequently, the canisters would be disposed of in a
    geologic repository. The Department believes that this ``can-in-
    canister'' immobilization approach meets the spent fuel standard in
    which the surplus plutonium is made as inaccessible and unattractive
    for retrieval and weapons use as the plutonium remaining in spent fuel
    from commercial reactors. Nonetheless, DOE has asked the National
    Academy of Sciences to examine the degree to which both U.S.
    disposition technologies meet the spent fuel standard. The National
    Academy of Sciences assessment is expected to be completed this summer.
        Question. Would you be comfortable with China or North Korea
    disposing of plutonium using the steel can approach?
        Answer. As a practical matter, a nuclear weapons state such as the
    United States, Russia or China has the technology to recover separated
    plutonium from either spent MOX fuel or the immobilized waste form. The
    real question that needs to be asked, however, is whether it is
    practical for a nuclear weapons state to do so in light of more readily
    available alternatives, which are cheaper and easier. Given this fact,
    the United States would be comfortable with Russia or China disposing
    of their surplus plutonium through immobilization and subsequent
    disposal in a geologic repository. North Korea, however, is not a
    recognized nuclear weapons state and is believed to lack key technology
    and readily available stockpiles of plutonium with which to readily
    fabricate nuclear weapons. As a result, under no circumstances would
    the U.S. be comfortable with North Korea disposing of surplus plutonium
    in this manner, should such material be available.
                                    schedule
        Question. Ms. Holgate, your program proposes to actually begin
    burning up U.S. plutonium in 2007. When do you plan to complete the
    disposition of all 50 tons of excess U.S. plutonium?
        Answer. Assuming the U.S. and Russia complete a plutonium
    disposition agreement later this year, the United States could dispose
    of its 50 metric tons of plutonium by 2022. This assumes a peak
    disposition rate of 5 metric tons of plutonium per year, with the
    ability to accelerate this rate should parallel progress be achievable
    in Russia.
        Question. How did you decide what an acceptable schedule would be?
        Answer. The schedule is an aggressive one based on a number of
    factors including technical considerations, cost, infrastructure and
    Russian considerations. However, given the current political
    instability and worsening economic conditions prevailing in Russia and
    the very real threat that surplus plutonium could be stolen or diverted
    into the hands of terrorists or non-nuclear nations, I feel that the
    aggressive schedule is warranted.
                               canadian reactors
        Question. I've been intrigued by the idea proposed a number of
    years ago to burn U.S. and Russian weapons-derived plutonium in
    reactors in Canada. Do you still plan to fabricate fuel for Canadian
    reactors, and when might we ship that fuel to Canada?
        Answer. Yes. A joint U.S.-Russian non-proliferation experiment is
    planned to be conducted this summer in Canada to demonstrate the
    feasibility of disposing of excess weapons plutonium by using it in
    mixed oxide (MOX) fuel in CANDU reactors. The Los Alamos National
    Laboratory has fabricated eight small fuel pins containing 119 grams of
    plutonium from dismantled U.S. weapons for the United States part of
    the experiment. The Russian Federation's Bochvar Institute is preparing
    to fabricate a similar amount of fuel from Russian plutonium. In the
    experiment, a Canadian test reactor will simultaneously irradiate these
    small quantities of MOX reactor fuel.
        DOE believes there is adequate interest and reactor capacity
    available within the United States to dispose of all excess U.S.
    plutonium. There may, however, be a need for additional reactor
    capacity to augment Russia's capability to dispose of its plutonium in
    reactors.
                                     ______

                      Questions Submitted by Senator Craig

                          nonproliferation technology
        Question. Secretary Richardson recently challenged all DOE national
    laboratories to ``identify technical breakthroughs which will
    revolutionize our proliferation detection capabilities.'' Do you plan
    to increase your support of research and development at non-defense
    laboratories so that the full capabilities of the DOE laboratories can
    get to work on meeting this important challenge?
        Answer. The Nonproliferation and Verification Research and
    Development (R&D) Program will continue to support R&D at both defense
    and non-defense laboratories to utilize the full capabilities of the
    DOE laboratories. In fiscal year 2000, Chemical and Biological
    Nonproliferation has been identified as the highest priority growth
    area with a budget request for this program of $31.2M, an increase of
    almost 70 percent over the fiscal year 1999 budget of $18.5M.
        In preparation for an expanded fiscal year 2000 budget the Chemical
    and Biological Nonproliferation Program invited all DOE National
    Laboratories to participate in a call for proposals. Technology gaps in
    our current program as well as on-going projects that could be
    accelerated into fielded capabilities through the infusion of
    additional R&D funding were the targets of this solicitation.
    Laboratories were encouraged to team with both academia and industry
    where technical expertise was needed and where systems were maturing
    towards implementation.
        Both new proposals and ongoing research and development projects
    will undergo a rigorous two-step peer review which will be conducted
    this Spring. The peer review panel will consist of technical experts
    and end-users from other government agencies, industry and academia.
        Funding decisions will be made on the basis of this peer review
    process which will focus upon the work's potential impact and
    advancement over current state of the art capabilities, the scientific
    and technical quality of the work, and finally the program management
    and technology implementation plan. It is expected that some of this
    important work will be conducted at the DOE's non-defense laboratories
    to meet our proliferation detection challenges.
                               russian navy fleet
        Question. I understand that the current U.S. program to dismantle
    Russian ballistic missile submarines is only addressing a fraction of
    the total number of inactive Russian submarines. The fuel for these
    submarines could present an environmental threat if not dealt with. Do
    you agree that these submarines pose a threat? Would you support an
    accelerated program to defuel all of the Russian submarines?
        Answer. Yes, I agree that the possibility of an environmental
    threat is present if dismantlement is not handled properly; we are also
    concerned about possible nuclear safety and security threats. We are
    coordinating through an interagency process to develop a strategy to
    deal with this very important issue. We will keep you informed of our
    progress.
                          kazakhstan bn-350 activities
        Question. I understood Argonne-West is conducting a very successful
    program to secure the spent fuel and blanket assemblies from the BN-350
    reactor in Kazakhstan. I also understand that Kazakstan has decided to
    shut down the BN-350 permanently. Experience in Idaho with the
    Experimental Breeder Reactor-II could be used to assist Kazakhstan in
    fire protection and handling of the radioactive sodium. Do you have
    plans for helping to resolve these concerns and assist the shutdown of
    the BN-350 reactor?
        Answer. The Department of Energy intends to assist Kazakhstan with
    the safe shutdown of the BN-350 reactor. In this effort, we plan to
    work closely with the International Atomic Energy Agency, the
    Government of Kazakhstan, and other countries with experience in sodium
    cooled reactor technology. We plan to place particular emphasis on
    safety issues, including sodium fire protection and sodium draining.
    Due to its experience with the operation and shutdown of the
    experimental Breeder Reactor-II, Argonne National Laboratory-West is
    playing and will continue to play a large role in our work to improve
    safety and to assist in the shutdown of the BN-350.
                           nuclear cities initiative
        Question. The Mayor of Idaho Falls has expressed interest in
    establishing a sister cities arrangement with the Russian city of
    Ozersk and supporting the work of ANL and INEEL in that city. What is
    your position on the mayor's proposal and on opening up the Nuclear
    Cities Initiative to DOE's non-weapons labs?
        Answer. The NCI Program has already been cooperating with Idaho
    Falls. Through the Energy Communities Alliance Annual Conference, NCI
    brought together the Mayor of Idaho Falls, Linda Milan, and the Mayor
    of Ozersk, Sergey Cherishov, to discuss economic development
    strategies. Additionally, NCI staff introduced the Russian and American
    mayors to the Director of Sister Cities International, Alexander Gorev,
    to promote their cooperation. And finally, NCI program staff has
    requested Sister Cities International to permit both Idaho Falls, ID,
    and Richland, WA, to pair with Ozersk in a new ``Sister Cities''
    relationship.
        The Department supports the participation of the non-weapons
    laboratories in the Nuclear Cities Initiative (NCI). Currently, the
    Savannah River Site and the Pacific Northwest National Laboratory have
    significant roles assigned under the NCI. For example, the Savannah
    River Site teams with Los Alamos National Laboratory in heading the
    Sarov City Working Group. Pacific Northwest National Laboratory is
    teamed with Lawrence Livermore National laboratory in the program
    efforts at Snezhinsk. The Oak Ridge Site and Sandia National
    Laboratories are teamed in the Zheleznogorsk Working Group. Argonne
    National Laboratory was recently tasked with the development of a new
    medical isotopes functional working group under NCI.
                                 bn-600 reactor
        Question. Russia's BN-600 reactor still incorporates a breeding
    blanket that produces about 450 kilograms of weapons-grade plutonium
    per year. Does the Administration plan to propose the conversion of the
    BN-600 blanket and the use of MOX fuel in the BN-600 as part of its
    plan to spend the $200 million emergency appropriation for Russian
    plutonium disposition provided by Congress?
        Answer. The government of Japan recently announced its intention to
    provide funding for the conversion of the Russian BN-600 breeder
    reactor for operation as a plutonium burner. The Department of Energy
    intends to cooperate with the Russian Ministry of Atomic Energy
    (MINATOM) and the Japanese government on issues associated with the
    conversion and the related funding.

                              subcommittee recess

        Senator Domenici. Okay. We look forward to that. We stand
    in recess.
        [Whereupon, at 11:45 a.m., Thursday, March 11, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

        ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2000

                                  ----------

                            THURSDAY, MARCH 18, 1999

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 9:30 a.m., in room SD-124, the
    Dirksen Senate Office Building, Hon. Pete V. Domenici
    (chairman) presiding.
        Present: Senators Domenici, Gorton, Craig, Reid, and
    Murray.
        Also present: Senators Campbell and Allard.

                              DEPARTMENT OF ENERGY

        Environmental Management and Civilian Waste Management Programs

    STATEMENTS OF:
            JAMES M. OWENDOFF, ACTING ASSISTANT SECRETARY FOR ENVIRONMENTAL
                MANAGEMENT
            LAKE H. BARRETT, ACTING DIRECTOR, OFFICE OF CIVILIAN
                RADIOACTIVE WASTE MANAGEMENT

                               OPENING STATEMENT

        Senator Domenici. The hearing will please come to order. I
    know Senator Reid is not here, but he will arrive shortly. I
    apologize, but I can only be here until 10:15, because I am
    finishing the budget markup upstairs in another room. So I
    would like to get started and keep my remarks to a minimum, in
    order to get on with testimony of our witnesses.
        We welcome the presence of Senator Campbell, who, while not
    being on the subcommittee, has asked, as he did last year, if
    he could come here and ask some questions about Rocky Flats. We
    will be glad to let you do that, Senator.
        This morning we review the budget request of the Department
    of Energy's Environmental Management Program, and the Civilian
    Radioactive Waste Management Program, otherwise known as the
    Yucca Mountain program.
        I want to welcome the witnesses here today, Mr. James
    Owendoff, Acting Assistant Secretary, Office of Environmental
    Management; and Mr. Lake Barrett, Acting Director of the Office
    of Civilian Radioactive Waste Management.
        Gentlemen, we have a busy schedule today in the Senate, and
    I ask that you be as brief as possible in summarizing your
    prepared statements, as you know they will be thoroughly read
    by the subcommittee. Without objection, right at the offset,
    your full prepared statements are going to be made part of the
    hearing record.
        Before I turn to Senator Reid, who will be along shortly, I
    want to mention one item of particular interest to Senator Reid
    and me, and that is the accelerator transmutation of waste. We
    included in last year's act $4 million to develop a road map
    for accelerated transportation of waste technology.
        The Department has made a great deal of progress in
    developing that road map, and I hope to come back to that issue
    at a hearing in April specifically for that purpose.
        Having said that, I wonder if, Senator Campbell, would you
    like to----
        Senator Campbell. Perhaps just a brief comment.
        Senator Domenici. Please.

                  STATEMENT OF SENATOR BEN NIGHTHORSE CAMPBELL

        Senator Campbell. Thanks for letting me sit with this
    subcommittee. I am a member of the full committee as well.
    Because of Rocky Flats, I have a very, very keen interest in
    this, and I am very pleased to see the administration has
    requested $657 million to continue the cleanup. I might tell
    you, Mr. Chairman, the sooner we get that cleaned up, we will
    be able to perhaps supply more money to WIPP, which is in your
    state.
        One thing I am concerned about is a proposal by the
    administration that we build some temporary tent structures to
    house it until this lawsuit is handled in New Mexico. I think I
    should tell my friends here that are going to be testifying,
    that is absolutely unacceptable. Our communities will go nuts
    if we tell them we are going to store any kind of waste in
    temporary tents, because their feeling, of course, is that once
    it is stored there in tents, it is just going to stay there,
    and we will not really make a concentrated effort to get it
    cleaned up.
        Last year, as you probably know, we did get an additional
    $30 million through the budget here in the Senate to accelerate
    that cleanup, but it has not been going as fast as some of us
    would like it. I am sure you are aware of that, and I would
    hope, as I am going to ask Secretary Richardson this afternoon,
    at Interior appropriations, to try and prioritize that. He has
    said that he will come out and take a look at that himself, as
    Hazel O'Leary has done, and a few others have done.
        Unfortunately, in the past, they come out for the photo
    ops, and then they don't make a concentrated effort to get the
    cleanup done. I think Secretary Richardson, since he is from
    New Mexico, and is very keenly aware of the problem in New
    Mexico and Colorado, will prioritize it, and I would hope that
    you would, too. Thank you, Mr. Chairman. I will ask some
    questions at the appropriate time.
        Senator Domenici. Senator Reid, since I have to leave at
    10:15 to finish the budget markup, I started----
        Senator Reid. I am glad you did.
        Senator Domenici [continuing]. In your absence.
        I think both of you know that we are involved in activities
    in the Department of Energy that are vitally important and can
    have significant impacts on the budget of the Department of
    Energy, because of very expensive programs. I might say in the
    presence of Senator Campbell that the one object of cleanup
    that is going along with some sense of urgency, and some real
    goals that are being accomplished, is the Rocky Flats. It is a
    shining star and we hope it will stay on track.
        We want to fund it and get it done. It seems like at the
    other cleanup sites, we are no further ahead today than we were
    10 years ago, that is just my editorial comment, but Rocky
    Flats is doing very well.
        So let us proceed. If you would proceed at this point, we
    would be delighted to hear your testimony, Mr. Owendoff.

                         statement of james m. owendoff

        Mr. Owendoff. Mr. Chairman, and members of the committee,
    thank you for this opportunity to appear before you to discuss
    the Department of Energy's Environmental Management program and
    our fiscal year 2000 budget request. I would like to cover
    several subjects in my brief oral statement.
        First, I will mention some significant progress we have
    made, as well as some of the challenges we face. Second, I will
    describe our budget request for fiscal year 2000.

                           program goals and progress

        As you know, the Environmental Management program is
    responsible for managing and cleaning up the environmental
    legacy of over 50 years of production of nuclear weapons and
    government nuclear energy projects. Cleaning up environmental
    contamination is just one part of our program. In addition, we
    are responsible for the safety and security of more than 25
    metric tons of weapons-useable plutonium, over 2,000 tons of
    intensively radioactive spent nuclear fuel, and for storing,
    treating, and disposing millions of cubic meters of radioactive
    waste.
        Clearly, this is a big job. To bring some closure to this
    program we have set a goal of cleaning up as many sites as
    possible by the end of 2006. By closing sites early, we reduce
    the hazards facing the public and our workers, concentrate our
    resources on cleaning up sites, rather than overhead costs
    necessary to keep a site open, and thereby lowering the long-
    term cost to the taxpayers.
        We have set very ambitious goals for closing, by the end of
    2006, the Rocky Flats site in Colorado, and the Mound and
    Fernald sites in Ohio. Our plans for closing these sites assume
    a stable funding stream, but a stable funding stream is not
    enough. Our ability to reach these goals will also require the
    creative use of the facilities and technical personnel at other
    sites.
        A cooperative strategy of integration across the complex is
    imperative. Such a strategy requires dedicated efforts by DOE,
    contractors, regulators, Native Americans, local governments,
    and other stakeholders to succeed.
        We are making progress toward our goal, as evidenced by
    some of the recent accomplishments. When we came before you at
    this time last year we had 53 sites requiring active cleanup.
    During this past year we reduced that number to 48, and we
    planned to complete cleanup at six more sites by the end of
    fiscal year 2000.
        With the completion of the remaining last two sites last
    year we completed surface cleanup at all 22 uranium mill
    tailings sites, as well as more than 5,300 contaminated
    properties in the vicinity of those sites. We have made real
    progress in reducing risks and mortgages at our large sites,
    where cleanup will continue past 2006.

                               hanford activities

        For example, in fiscal year 1998 we completed deactivation
    of the N-reactor complex, the last of nine reactors, at the
    Hanford site, and the B-plant, a plutonium processing facility
    at Hanford. In both cases we reduced annual surveillance and
    maintenance costs from $20 million to less than $1 million.
        Our past investments in technology development are now
    making significant demonstrable contributions. In the past year
    alone we demonstrated 40 technologies to reduce risks and/or
    costs of cleanup projects, and our sites used new technologies
    in 108 instances.

                         waste isolation pilot project

        We have made significant steps toward beginning the
    operations at the Waste Isolation Pilot Plant in New Mexico,
    where we intend to dispose of our transuranic waste. In May
    1998, the Environmental Protection Agency certified that WIPP
    met disposal standards, and in June 1998, the Defense Nuclear
    Facilities Safety Board concluded that WIPP could be operated
    safely.
        We expect to begin shipments of non-mixed transuranic waste
    to WIPP, assuming pending litigation is favorably resolved. We
    are also working with the state to obtain a permit that will
    allow us to ship mixed waste.

                        fiscal year 2000 budget request

        Turning to our request for fiscal year 2000, we are
    requesting $5.7 billion in traditional budget authority, $100
    million more than was appropriated for the current fiscal year.
    We are also requesting $228 million in budget authority to
    support privatization projects. This budget will support
    accelerated cleanup and closure, the deployment of new
    technologies, and progress in treating and disposing of nuclear
    waste, including shipments to WIPP.
        The request also supports closure of Rocky Flats. We have
    developed a baseline defining the critical path for closing in
    2010, and have identified opportunities to accelerate closure
    to achieve the goal of closing the site by the end of 2006.
        In the fiscal year 2000 budget request, we have given
    priority to our high-risk problems, such as stabilizing and
    ensuring the security of plutonium, stabilizing high-level
    waste tanks, and ensuring the safe storage of spent nuclear
    fuel, including the foreign research reactor spent nuclear
    fuel, with highly enriched uranium, that we are bringing back
    to the United States to reduce worldwide nuclear proliferation
    risks. We intend to meet our statutory and regulatory
    requirements, as well as our obligations under compliance
    agreements, with state and federal agencies.
        We will continue to ensure that our cleanup projects are
    well managed and use the taxpayers dollars most efficiently.
    All of our cleanup work is organized into projects. You can see
    the projects and the associated performance measures in our
    budget request, which is organized by project, as requested in
    last year's appropriations bill.
        We are also taking a number of actions to improve our
    project management performance. We are conducting external
    independent project assessments and enhancing our federal staff
    capability to independently review our projects, and we
    continue to improve our contracting methods to provide our
    contractors with the right incentives and penalties for good or
    poor performance.
        In conclusion, our fiscal year 2000 request will enable us
    to reduce our risks, meet legal obligations, and continue to
    work toward our goal of completing as much cleanup as possible
    by 2006. We would like to continue to work cooperatively with
    Congress to meet these goals.
        I also ask for the committee's consideration of the $53
    million reprogramming request that we have submitted for the
    operation of the high-level waste tanks for the fiscal year
    1999 budget. I want to apologize for the untimely submission of
    that request. It was in no way intended to preclude an
    appropriate review by the Congress of that request.

                               prepared statement

        As we indicated to the committee staff, we are also
    finalizing a reprogramming request for the Savannah River site
    in South Carolina and expect to submit that request in the next
    several weeks.
        Thank you, Mr. Chairman. I am pleased to answer any
    questions asked.
        Senator Domenici. Thank you very much.
        [The statement follows:]

                    Prepared Statement of James M. Owendoff

        Mr. Chairman, and Members of the Subcommittee, I appreciate this
    opportunity to appear before you to discuss the Department of Energy's
    Environmental Management (EM) program and its fiscal year 2000 budget
    request.
        During this past year, the Department has made a significant amount
    of progress both in cleaning up sites and in operating a truly
    performance-based management system. Our budget request for fiscal year
    2000 provides $5.7 billion in traditional budget authority, allowing us
    to continue progress towards our cleanup goals. The request also
    includes $228 million in budget authority to support privatization
    projects.
        The commitments based on this budget will be accelerated cleanup
    and closure, deployment of new technologies, and progress in treating
    and disposing of legacy nuclear waste. We have set very ambitious goals
    for closing several sites by the year 2006, including the Rocky Flats
    Site in Colorado, and the Mound and Fernald Sites in Ohio. We also plan
    to complete cleanup at the Weldon Spring Site in Missouri, our sites in
    California and various other locations by that date. Consequently, we
    are eager to continue working with Congress to focus funding on
    cleaning up and closing sites.
        The EM budget also reflects our expectation that we will begin
    shipments of transuranic waste to the Waste Isolation Pilot Plant
    (WIPP) this year and our intent to support and increase shipments in
    fiscal year 2000. The U.S. Environmental Protection Agency (EPA)
    certified WIPP for disposal of radioactive waste in May of 1998. We
    hope to make our first shipments this year if pending litigation is
    resolved favorably, a crucial step forward in providing for the
    permanent disposal of a portion of the Department's long-lived
    radioactive waste and the accelerated closure of sites like Rocky
    Flats.
                                  introduction
        Before discussing our fiscal year 2000 budget request, I would like
    to provide an overview of our program and some of our accomplishments
    in the past year. We continue to work towards the goal we have
    established to clean up as many of the remaining contaminated sites as
    possible by 2006, safely and cost-effectively. Indeed, when we came
    before you at this time last year, we had 53 sites requiring active
    cleanup. Having completed cleanup at three sites, with transfer of
    another two sites to the State of North Dakota at its request, that
    number is now reduced to 48, and will decrease by six more sites by the
    end of fiscal year 2000. By working towards our goal for accelerated
    cleanup, we not only reduce the hazards presently facing our workforce
    and the public, but also reduce the long-term financial burden on the
    taxpayer. For every year that a site remains open because cleanup has
    not been completed, we are paying a ``mortgage'' of overhead costs for
    activities such as site security, facility operations, personnel, and
    safety. The fiscal year 2000 budget request is now fully structured to
    emphasize site closure and project completion.
              a. meeting the challenge of the environmental legacy
        The EM program is responsible for managing and cleaning up the
    environmental legacy of the nation's nuclear weapons and government
    nuclear energy projects. Beginning with World War II, DOE and its
    predecessor agencies developed the largest government-owned industry in
    the United States, responsible for nuclear weapons research,
    development, testing, and production as well as a variety of other
    nuclear-related research projects. When most nuclear weapons production
    operations ceased in 1989, DOE established the Office of Environmental
    Management to address the environmental legacy of nuclear weapons
    production and other nuclear-related programs. Our responsibilities
    include facilities and sites in 30 states and one territory which
    encompass about 2.1 million acres--an area equal to that of Rhode
    Island and Delaware combined.
        Although EM is often referred to as the ``cleanup program,'' this
    term can be misleading if it is interpreted to compare EM's program to
    EPA's Superfund program or the environmental restoration program at the
    Department of Defense. In addition to these ``standard'' cleanup duties
    at DOE sites, EM is also responsible for the world's largest nuclear
    stewardship program, which maintains the safety and security of more
    than 25 metric tons of weapons-usable plutonium and over two thousand
    tons of intensely radioactive spent nuclear fuel, and for carrying out
    critical nuclear non-proliferation programs.
        Completing the cleanup of the legacy from nuclear weapons
    production will allow the Department to focus on its science, security,
    and energy missions and will fulfill commitments to communities and,
    where appropriate, return lands and facilities to the communities for
    reuse.
        Finally, it is important to note that the nature of much of the
    waste handled by DOE is fundamentally different from most chemical
    waste cleanup programs, since radioactive waste cannot be broken down
    into constituent elements, but instead requires isolation from the
    environment through treatment and/or disposal while it decays. Because
    of the frequently long-lived radioactive nature of the 36 million cubic
    meters of waste (containing about one billion curies of radioactivity),
    we can treat it, stabilize it, contain it, isolate it and monitor it,
    but we cannot destroy it with currently available technology.
         b. accomplishments and progress--cleaning up and closing sites
        I am pleased to report that our program has produced substantial
    cleanup results at contaminated nuclear facilities around the country.
    For example:
        Since 1989, we have completed necessary cleanup actions at nearly
    half (about 4,100) of individual waste sites (known as ``release
    sites'') out of a total inventory of 9,700 release sites.
        We completed surface cleanups of all 22 large uranium mill tailings
    sites as well as more than 5,300 ``vicinity properties,'' including
    elementary schools and homes. This project included remediation of over
    40 million cubic yards of contaminated soil and material, a volume that
    would cover a football field with a mound of dirt four miles high. We
    are now monitoring low-level ground water contamination at some mill
    tailings sites, with active remediation planned at three sites.
        We have made significant steps toward beginning transuranic waste
    disposal operations at the Waste Isolation Pilot Plant (WIPP) in New
    Mexico--we received certification from the U.S. Environmental
    Protection Agency in May 1998 that WIPP met disposal standards and
    notification in June 1998 from the Defense Nuclear Facilities Safety
    Board that WIPP can be operated safely.
        We successfully operated two high-level waste vitrification
    facilities in South Carolina and New York, where last year we converted
    nearly 2,500 cubic meters of waste into 331 canisters of ``glass logs''
    ready for disposal. The first phase of the high-level waste
    vitrification campaign at the West Valley, New York facility was
    completed in fiscal year 1998, under budget and ahead of schedule, and
    we are now vitrifying the tank heels.
        The Department awarded the second part of ``Phase 1'' of a
    ``privatization'' contract, covering the extended design of new
    facilities for the treatment of a portion of the high-level waste in
    the tanks at the Hanford Site in Washington.
        We finished connecting community drinking water hookups surrounding
    Brookhaven National Laboratory in New York. We have sponsored more than
    1,500 hookups for off-site residences from fiscal year 1996 through
    fiscal year 1998 to ensure that residents' drinking water supply
    remains unaffected during long-term ground water cleanup.
        In support of non-proliferation goals, we have now completed a
    total of eight shipments of spent nuclear fuel from foreign research
    reactors from fifteen countries, including Chile, South Korea, and
    Columbia. Seven shipments have been received at the Savannah River Site
    in South Carolina and, in fiscal year 1998, the first shipment to the
    Idaho National Engineering and Environment Laboratory was completed.
        We completed ``closure'' of a second high-level waste tank at the
    Savannah River Site in South Carolina. After removing waste, the tank
    was backfilled using an innovative grout to immobilize residual
    radionuclides.
        We disposed of 30,000 cubic meters of low-level waste and 10,000
    cubic meters of mixed low-level waste in fiscal year 1998 alone.
        At Rocky Flats, we stabilized or repackaged about 5,000 kilograms
    of plutonium-bearing residues in fiscal year 1998. In addition, Rocky
    Flats staff drained acid plutonium liquids from two 2 liquid-piping
    systems in Building 771 and then removed the pipes.
        We demonstrated 40 alternative technology systems and made 42
    systems ready for implementation with cost and engineering performance
    information.
        Field operations' use of new technologies that can reduce cleanup
    cost and schedules is gaining momentum. EM has verified the first-time
    use of alternative technologies at a site in 108 instances at cleanup
    projects throughout the DOE complex in fiscal year 1998.
        We continue to use pollution prevention techniques to reduce our
    overall costs. In fiscal year 1998 alone, DOE sites completed over 700
    pollution prevention projects, avoiding the generation of 45,000 cubic
    meters and saving an estimated $155 million.
        We continued our financial management improvements: at the end of
    fiscal year 1998, our uncosted balances were lower than the established
    benchmark for the third year in a row.
        We are proud of our accomplishments, but also realize that
    completing our daunting task will require accelerated cleanup and
    greater efficiency if we are to succeed at the level of funding
    requested in the year fiscal year 2000.
     the fiscal year 2000 request reflects the evolution of the em program
        We have been giving priority to high risk problems such as
    stabilizing and ensuring the security of plutonium, stabilizing tanks
    containing high-level radioactive waste, and ensuring the safe storage
    of spent nuclear fuel, including foreign research reactor fuel in
    support of non-proliferation goals. We are working to accelerate
    cleanup and reduce ``mortgages,'' and have aligned our budgeting and
    management systems to support this goal. We are integrating waste and
    materials management across the DOE complex to support closure of sites
    like Rocky Flats and to improve the efficiency of our operations. We
    also know that successful cleanup requires investing in developing and
    deploying more effective technologies; without successful investments
    in innovative technologies, the cost and technical challenges would
    make long-term success impossible. Finally, we have found that
    performing good technical work is not enough. Getting the job done
    requires cooperation with regulators and other stakeholders. We have
    supported effective public participation through continued
    relationships with states and site-specific and national advisory
    boards, as well as funding for Indian tribes potentially affected by
    our activities.
        The fiscal year 2000 request of $5.7 billion, $100 million more
    than the level appropriated in fiscal year 1999, reflects our effort to
    maintain a stable program that provides sufficient resources to meet
    our multiple demands of risk reduction, compliance and mortgage
    reduction.
                             a. management reforms
        In last year's presentation to you, we described a number of
    changes in the way EM manages its work to better reflect our focus on
    completion and closure and to provide better accountability to program
    managers, Congress, and our stakeholders. The reforms begun in fiscal
    year 1998 and fiscal year 1999 have now been institutionalized and are
    more fully integrated across the different components of the program.
    1. Taking a Project-Based Approach to Cleanup
        The EM program has made great strides over the last several years
    in organizing the work that must be accomplished to complete the
    cleanup of the weapons complex into ``projects.'' These projects have
    end-state goals and contain schedules and life cycle costs for
    achieving those goals. This ``projectizing'' of the work has resulted
    in increased site ownership and accountability and improved cost-
    effectiveness in planning and conducting our work. We recognize,
    however, that improvements are needed, for example, in the way the
    projects are structured and in the underlying baseline data defining
    schedules and life-cycle cost to complete each project. We are actively
    working to improve the quality of data by implementing a more formal
    system to control and document changes to the project baselines, and
    are also pursuing various strategies to validate the baselines. To
    determine if these efforts have been effective, the Secretary has
    requested that the Office of the Inspector General review some
    representative projects in July, and report back on additional
    improvements that may be needed. Through such efforts, we expect to see
    data quality improve with each subsequent update.
        With more than 350 projects of the scope and complexity of those
    facing EM, it is critical that we clearly define what we are trying to
    accomplish, how and when we are going to accomplish it, and at what
    cost; and that we are applying sound project management practices. To
    improve our project management performance, EM is developing the
    capability to conduct in-house independent reviews of projects to
    examine their cost, schedule, and technical baseline, as well as other
    parameters of good project management. Our reviews use experts within
    DOE and in external organizations with nationally-recognized expertise
    in project management. EM has conducted independent reviews of three
    privatization projects--the Hanford Tank Waste Remediation System, the
    Oak Ridge Transuranic Waste Treatment project, and the Carlsbad
    Transuranic Waste Transportation Project--and a review of alternatives
    to the In-Tank Precipitation process at the Savannah River Site. In
    addition, the Office of Field Management has conducted a number of
    baseline reviews, as directed by report language accompanying the
    Energy and Water Development Appropriations Act of fiscal year 1998. We
    are using the recommendations from these reviews to improve the
    management of our projects.
    2. Restructuring the Budget
        In fiscal year 1999, we established a new budget structure to align
    with our goals of accelerated cleanup and to support project-based
    management of our work, allowing us to more closely track costs and
    performance at a project level. The fiscal year 2000 budget request
    continues that structure, but is now built from the ground up, one
    project at a time, with costs, schedules and expectations for
    performance identified for each project. Congress supported this change
    to ``projectizing'' our work in last year's budget request and directed
    EM to prepare its fiscal year 2000 budget request based on individual
    projects, an approach we fully support.
        The budget and management structure is based on our vision of
    completing cleanup at as many sites as possible by the year 2006. These
    accounts--in both the defense and non-defense portions of the budget--
    are:
      --Site Closure Account.--Includes funding for sites for which the EM
            program has established a goal of completing its cleanup
            mission by the end of fiscal year 2006. After EM's cleanup
            mission is complete at these sites, no further Departmental
            mission is envisioned, except for limited long-term
            surveillance and maintenance, and the sites will be available
            for some alternative use;
      --Site/Project Completion Account.--Funds cleanup projects
            anticipated to be completed by fiscal year 2006 that are
            located at sites or facilities where a DOE mission (e.g.,
            weapons research/production or scientific research) will
            continue beyond 2006;
      --Post 2006 Completion Account.--Funds projects and site cleanup that
            are too technically complicated and expensive to be completed
            by 2006 and includes treatment of high-level wastes and cleanup
            of large intensely contaminated ``canyon'' buildings.
    3. Measuring--and Managing--Performance
        In accordance with the Government Performance and Results Act, EM
    has moved aggressively to develop and implement a performance-based
    budget that measures tangible, on-the-ground accomplishments to
    demonstrate results for the resources provided. EM has established
    Corporate Performance Measures that demonstrate environmental cleanup
    progress and provide a balanced approach to assessing effectiveness and
    efficiency. The fiscal year 2000 budget request provides quantitative
    performance goals at the project level for these Corporate Measures. By
    combining this project data at the Operations/Field Office level, we
    have established Management Commitments that are being used to review
    and evaluate quantitatively performance in the field.
        We began developing the current performance measurement system in
    fiscal year 1994 when EM became a pilot program under the Government
    Performance and Results Act. We have continually refined the system and
    have made significant progress in incorporating the requirements and
    spirit of the Act into our management system. The measures we have
    established--quantities of waste disposed, release sites completed,
    nuclear materials stabilized, facilities deactivated and
    decommissioned--represent tangible progress, not just paper progress,
    that link to our cleanup goals. The performance measurement system is
    increasingly integrated from top to bottom--from the EM Program level
    across the complex to the project level in the field. The accuracy and
    consistency of the data have improved from year to year and, as
    reliability improves, the determination of the field and the Program to
    meet their performance commitments increases as well. We are now
    working to improve our life-cycle quantity estimates so that they can
    be used to set near-term performance goals.
                     b. progress toward completing cleanup
        By focusing on completing cleanup at most of our sites by 2006, we
    expect to substantially reduce life-cycle costs. We have made
    substantial progress towards this vision. We are completing site
    cleanups: in fiscal year 1998, EM completed surface cleanups at all
    uranium mill tailings sites with the completion of the last two of the
    22 originally designated sites. EM is scheduled to complete its work at
    another three sites in fiscal year 1999, specifically Sandia National
    Laboratory in California, Ames Laboratory in Iowa, and Princeton Plasma
    Physics Laboratory in New Jersey; and this fiscal year 2000 budget
    request provides funds for completion of another three sites--Argonne
    National Laboratory-West in Idaho, the General Atomics site in
    California, and the Battelle Columbus-King Avenue site, in Ohio.
        We are making progress toward reaching our closure goals at Rocky
    Flats and other closure sites. Rocky Flats has defined the critical
    path for closing in fiscal year 2010 and is now revising this
    ``baseline'' to reflect a closure goal of 2006. This fiscal year 2010
    baseline identifies a number of opportunities to accelerate closure and
    achieve the fiscal year 2006 goal, such as accelerating off-site
    shipments of plutonium residues and metals and oxides by two years and
    decommissioning facilities more efficiently. The accelerated closure
    goal is obviously aggressive, and we have a lot of challenges ahead--
    including beginning operations at WIPP to allow for the disposal of
    Rocky Flats transuranic waste. However, we are committed to making our
    best efforts, and the fiscal year 2000 budget request supports the
    current baseline and activities already identified as necessary to meet
    the fiscal year 2006 goal. For example, the fiscal year 2000 request
    provides for shipments of plutonium-bearing materials to Savannah River
    Site for temporary storage. It also includes decommissioning of the
    Building 779 cluster, a former plutonium production facility, by June
    2000, constituting not only an acceleration of the schedule for this
    specific project, but also providing an opportunity to examine
    technologies to accelerate the overall schedule for decommissioning,
    useful for other projects at Rocky Flats and throughout the DOE
    complex.
        We continue on track at the Mound and Fernald sites in Ohio, with a
    goal of turning over as many of the facilities at the sites as possible
    to the communities for private use. In fiscal year 1998, for example,
    the Department executed a sales agreement with the Miamisburg Mound
    Community Improvement Corporation for transfer of facilities and
    structures at the Mound Site, documenting our commitment to completing
    work at the site. We are seeing progress at our sites funded from the
    Non-Defense account as well: in fiscal year 1998, we completed the
    primary vitrification campaign of the high-level waste at the West
    Valley Demonstration Project ahead of schedule, and have begun the
    vitrification of high-level waste tank heels which will continue
    through fiscal year 2001.
        We are also making progress at our larger sites, where cleanup will
    continue beyond 2006, in completing projects and reducing the mortgage
    and the ``footprint'' of the cleanup task. For example, we completed
    deactivation of N-Reactor in fiscal year 1998, the last of nine
    production reactors at the Hanford Site in Washington. This involved
    the deactivation of 86 facilities and the removal of 33 grouted
    ``monoliths'' containing most of N-Reactor's high-dose materials.
    Completing the deactivation at N-Reactor reduced overhead costs of
    safely maintaining the facility from about $20 million to $500,000 a
    year. In addition, C-Reactor was placed in safe storage, with the
    result that inspection requirements can be reduced from every one to
    every five years, and with an annual surveillance and maintenance
    savings of $190,000.
        After completing active cleanup, the Federal Government will be
    obligated to maintain some controls at many sites to monitor, maintain,
    and provide information on the stabilized and contained residual
    contamination. These activities are necessary to ensure the continuing
    integrity of the cleanup and the protection of public health and
    safety. Such long-term stewardship will include passive or active
    controls and, often, treatment of groundwater over a long period of
    time. The extent of long-term stewardship required at a particular site
    will depend on the remedy and resulting end-state developed in
    consultation among DOE and other representatives of the Administration,
    Congress, Tribal Nations, representatives of regulatory agencies
    including state and local authorities, representatives of non-
    governmental organizations, and interested members of the public. The
    Department is committed to meeting its obligations to provide long-term
    stewardship of these sites.
        Funding for long-term stewardship is managed through various
    organizations, including (1) the Grand Junction Office, which funds
    long-term surveillance and maintenance at closed uranium mill tailings
    sites and several former nuclear weapons sites, such as the Pinellas
    Site, as well as closed experimental reactors; (2) the Nevada
    Operations Office, which funds long-term surveillance and maintenance
    for former nuclear explosion sites, located in Alaska, Colorado,
    Mississippi, New Mexico and Nevada; and (3) individual DOE Operations
    Offices, where cleanup of some areas has been completed but other
    activities continue. We are currently preparing a study on long-term
    stewardship, pursuant to the settlement of a lawsuit on the
    Programmatic Environmental Impact Statement (NRDC v. Richardson). We
    expect to complete the study by December 2000.
                           c. science and technology
        The EM Program has made significant changes in the way our science
    and technology program conducts its business of providing new or
    improved cleanup solutions. No longer solely a developer of cleanup
    technologies, this program has extended its role to provide the full
    range of science and technology resources and capabilities that are
    needed to deliver and support fully developed, deployable solutions to
    DOE's cleanup and long-term environmental stewardship problems--from
    basic research through development, demonstration, deployment and
    technical assistance. We are also enhancing the membership of our Focus
    Areas--the teams that address DOE's five major environmental problems--
    to include a lead national laboratory for each team to complement
    talent already on the teams. It is our intent that these teams of the
    Nation's best available environmental scientists will serve as
    ``centers of expertise'' to provide the broadened services assumed by
    this program.
        More than 500 site-identified environmental problems need new
    technological solutions if we are to meet EM cleanup goals. Over 80
    percent of these problems are categorized as high and medium priority.
    To provide sound advanced planning and a well executed strategy to
    ensure we are making the best possible science and technology
    investments to meet these needs, we have recently developed three
    complementary products: an EM R&D Program Plan that ``maps''
    investments in solutions to our cleanup needs, a Strategic Plan for the
    Office of Science and Technology (OST) to administer these investment
    plans, and an OST Management Plan that delineates improved business
    processes. These new plans provide a fully integrated approach that
    ensures our science and technology activities are planned and managed
    in an interactive, coordinated and participatory relationship with EM
    cleanup project managers and stakeholders.
        The request of $230.5 million in fiscal year 2000 support science
    and technology activities that:
      --meet the highest priority cleanup project needs
      --reduce the cost of EM's costliest cleanup projects
      --reduce technology risk
      --accelerate and increase technology deployment by bridging the gap
            between development and use
        EM's past investments in science and technology are already making
    important cleanup contributions. Let me offer some examples:
        During fiscal year 1998, innovative technologies made an
    increasingly important contribution in cleanup actions at the sites.
    For instance:
      --The Savannah River Site used an improved in-tank grouting process
            to seal the second of 24 high-level waste tanks that must be
            emptied and sealed with grout to trap the residual waste and
            strengthen tank integrity.
      --The Borehole Miner, which was adapted from the mining industry and
            uses a water jet to mobilize waste for pumping, was used at Oak
            Ridge to remove sludge and saltcake from underground storage,
            successfully transferring 95 percent of the waste from five
            hydrofracture tanks. This technology provides access to
            previously inaccessible areas.
        We now have several technologies to treat mixed waste, including
    polymer macroencapsulation. Waste from over 20 sites has been treated
    using this process, where solid waste is encased in a non-leaching
    plastic monolith suitable for disposal.
        We are now able to safely perform tasks in extremely hazardous
    environments using remotely operated robotic equipment, such as the
    ``Houdini vehicle.'' The Houdini can be inserted through 24-inch
    openings into radioactive tanks and then opened into a four-by-five
    foot mini-bulldozer, complete with a plow blade, manipulator and remote
    cameras to perform various tasks. The Houdini provides access to the
    interior of the tank, which was previously inaccessible.
        During fiscal year 1998, 40 technologies that meet needs identified
    by site personnel were demonstrated. All of these technologies reduce
    risk and/or costs associated with cleanup or provide technical
    solutions that did not previously exist. Another 42 alternative
    technologies were made available for implementation in cleanup projects
    during fiscal year 1998. Valuable cost and engineering performance data
    are available for all of our technologies as they are made available
    for implementation. Many other new technologies are currently in late
    stages of development and will be ready for use in time to contribute
    to our accelerated cleanup goals.
        We are also seeing significant success in moving beneficial
    technologies out into the field through the Technology Deployment
    Initiative (now known as Accelerated Site Technology Deployment), begun
    in fiscal year 1998. In fiscal year 1998, we initiated 14
    competitively-selected projects, resulting in 13 deployments by the
    year's end, and another 42 projects were selected for possible funding
    in fiscal year 1999. In our fiscal year 2000 budget request, deployment
    assistance activities are an integral part of the work performed by the
    Focus Areas, rather than a separately budgeted activity.
        Our Environmental Management Science Program (EMSP), which is
    managed in partnership with DOE's Office of Science and operates in
    tandem with the Focus Areas, is EM's assurance that basic scientific
    knowledge is advanced to support the development of cutting-edge
    environmental technologies. This program is proving to be a
    programmatic and management success for DOE's cleanup effort. The
    National Academy of Sciences has given EMSP high marks, and it was
    recognized with the Vice President's ``Hammer Award'' in 1998 for the
    innovative management approaches it is using. Research sponsored by
    EMSP is providing some significant technical results. For example,
    researchers at the University of Washington are genetically engineering
    a natural soil bacterium with high resistance to radiation into a
    natural detoxifier for complex mixed wastes. The efforts may yield an
    inexpensive, effective bioremediation of contaminated sites.
        In fiscal year 1998, we awarded 33 3-year EMSP grants in two areas
    to respond to EM technology needs: decontamination and decommissioning,
    and high-level radioactive waste. During fiscal year 1999, we have
    issued Request for Proposals solicitations for vadose zone, subsurface
    contamination research, and research on the biological effects of
    exposure to low doses of ionizing radiation.
                 d. complex-wide integration to support cleanup
        Critical to our success in closing sites and accelerating our work
    is integrating the way the Department manages its waste and materials
    by making the best use of the unique capabilities at DOE sites to
    address cleanup problems. This means taking a corporate view of EM's
    work and sharing information and resources across sites. Our
    integration initiative is seeking to consolidate treatment, storage and
    disposal facilities where it makes good sense; apply innovative
    technologies at multiple sites; eliminate redundant facilities and use
    available capacity rather than construct new facilities; and apply
    lessons-learned and site successes complex-wide.
        We have made significant progress in the past year in building the
    information base and the institutional structure to support and
    encourage integration. For example, we now have complex-wide data on
    waste and material inventories, both current and projected, and on
    their disposition pathways. Cross-site teams are identifying and
    evaluating integration opportunities, such as the consolidation of
    small quantities of transuranic waste currently being stored at small
    sites such as Battelle Columbus in Ohio and Energy Technology
    Engineering Center in California. These efforts will provide the
    technical basis and focal point for working with local communities and
    regulators, as well as within the Department, on integration proposals.
        We have several key initiatives to facilitate closure by moving
    materials to other sites for interim storage, with requested funds
    supporting the necessary activities in both the receiving and the
    sending sites. For example, the Department has been consolidating
    storage of certain special nuclear materials, such as plutonium.
    Plutonium weapons components from the Rocky Flats Site for example,
    have been shipped to the Los Alamos National Laboratory in New Mexico
    or to the Pantex Plant in Texas, an action that is now complete. This
    consolidation has allowed the Department to greatly reduce the cost of
    maintaining security for the remaining plutonium materials at the Rocky
    Flats Site.
        Second, the Department has proposed shipping certain plutonium
    metals and oxides (non-pit plutonium) from the Rocky Flats Site to the
    Savannah River Site in South Carolina. The Savannah River Site is in
    the process of modifying the K Area facilities to store this excess
    plutonium, consistent with a recently issued decision made in
    accordance with the National Environmental Policy Act.
        Third, the Department is seeking to share facilities with
    comparable capabilities to avoid duplication in treating and disposing
    of similar wastes. We have been conducting extensive technical analyses
    and working with state representatives and with other stakeholders to
    address both technical and non-technical issues. In fiscal year 1999 we
    expect to make decisions based on the Waste Management Programmatic
    Environmental Impact Statement that will further clarify the number of
    low-level and mixed low-level waste treatment and disposal facilities
    that will be needed for DOE's wastes. These decisions are likely to
    result in some consolidation of waste disposal as well as development
    of capabilities that do not currently exist, capabilities that are
    needed to support closure of sites.
        Finally, the Waste Isolation Pilot Plant (WIPP) in New Mexico
    provides one of the most compelling examples of shipping nuclear waste
    to greatly reduce costs and risks. Currently a large amount of
    transuranic waste is being stored at about two dozen sites around the
    United States. In many cases, this waste has been stored for decades
    with no place to go for disposal. Beginning disposal operations at WIPP
    will allow the Department to reduce the number of sites where this type
    of waste is stored and is critical to the closure of sites such as
    Rocky Flats, where the site cannot be cleaned up and closed unless the
    transuranic waste is disposed of. We have made significant steps toward
    beginning disposal operations, but still need to resolve outstanding
    litigation and permitting issues so that disposal operations can begin.
    Our ability to meet waste management commitments in other states--most
    notably in Idaho and Colorado--is dependent on beginning operations.
                                   conclusion
        The EM program has a vision for completing cleanup at most sites by
    2006. Focusing on this goal will not only accelerate risk reduction,
    but will result in substantial cost reductions that can be applied to
    cleanup at other sites. Realizing this vision will require a sustained
    national commitment. We understand that this is attainable only with an
    enormous amount of work and with the Department working cooperatively
    with Congress.

                                   Appendix A

                     summary of the fiscal year 2000 budget
        The total fiscal year 2000 budget request for the Department of
    Energy's Environmental Management Program is $5.7 billion in
    traditional budget authority and $228 million of privatization funding.
    The fiscal year 2000 appropriation will fund cleanup at sites in
    twenty-two states across the Nation. Five sites receive two-thirds of
    Environmental Management funding--Savannah River Site in South
    Carolina, Hanford Site in Washington, Rocky Flats in Colorado, Idaho
    National Engineering and Environment Laboratory in Idaho, and Oak Ridge
    Reservation in Tennessee. This section describes progress and
    highlights from the fiscal year 2000 budget request for the major
    Environmental Management sites and other selected sites.
        Tables 1 and 2 summarize our fiscal year 2000 request, organized by
    the five primary appropriation accounts and by Operations/Field Office
    and Site, respectively.
        Our fiscal year 2000 budget proposal provides details on each
    project, including performance measures, which we use to hold managers
    accountable, and expect to be held accountable by Congress. We would
    like to summarize the budget request and some major activities for
    several sites:
        1. Savannah River Site, South Carolina;
        2. Hanford, Washington;
        3. Rocky Flats Environmental Technology Site, Colorado;
        4. Idaho National Engineering and Environmental Laboratory, Idaho;
        5. Oak Ridge Reservation, Tennessee;
        6. Fernald Environmental Management Project, Ohio;
        7. Waste Isolation Pilot Project, New Mexico;
        8. Los Alamos, New Mexico;
        9. West Valley Demonstration Project, New York;
        10. Wiamisburg Environmental Management Project (Mound Site);
        11. Weldon Spring Site Remedial Action Project, Missouri;
        12. Nevada Test Site, Nevada;
        13. Brookhaven National Laboratory, New York;
        14. California Sites.

                         TABLE 1.--ENVIRONMENTAL MANAGEMENT FISCAL YEAR 2000 BUDGET REQUEST \1\
                                                 [Dollars in thousands]
    ----------------------------------------------------------------------------------------------------------------
                                            Defense
               Program Account             Facilities   Defense EM     Def. EM      Non-Def     UE D&D      Total
                                            Closure                 Privatization      EM        Fund
    ----------------------------------------------------------------------------------------------------------------
    Site Closure........................   $1,054,492  ...........  .............   $211,146  .........   $1,265,638
    Site/Project Completion.............  ...........     $980,919  .............    100,866  .........    1,081,785
    Post 2006 Completion................  ...........    2,513,548  .............     18,922  .........    2,532,470
    UE D&D Fund.........................  ...........  ...........  .............  .........   $240,198      240,198
    Program Direction...................  ...........      349,409  .............  .........  .........      349,409
    Science & Technology................  ...........      230,500  .............  .........  .........      230,500
                                         ---------------------------------------------------------------------------
          Subtotal, Traditional Budget      1,054,492    4,074,376  .............    330,934    240,198    5,700,000
           Authority....................
    Privatization.......................  ...........  ...........     $228,000    .........  .........      228,000
                                         ---------------------------------------------------------------------------
          Total EM request..............    1,054,492    4,074,376      228,000      330,934    240,198    5,928,000
    ----------------------------------------------------------------------------------------------------------------
    \1\ Does not include $420,000 payment to the Uranium Enrichment Decontamination and Decommissioning Fund,
      requested in the Defense appropriation, Post-2006 Completion account.

                   TABLE 2.--ENVIRONMENTAL MANAGEMENT FISCAL YEAR 2000 BUDGET REQUEST--FUNDING BY SITE
                                                [In thousands of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                         Fiscal year
                                                                        --------------------------------------------
                                                                              1998           1999           2000
                                                                         appropriation  appropriation  congressional
                                                                             total          total      request total
    ----------------------------------------------------------------------------------------------------------------
    Albuquerque operations office:
        Albuquerque Operations Office..................................       18,120          8,080           5,550
        Grand Junction.................................................       14,015          7,163           8,500
        Kansas City Plant..............................................        3,513          1,756           1,100
        Los Alamos Nat. Lab............................................      131,315         81,574         110,834
        Lovelace-BERI..................................................          789            478             481
        Maxey Flats....................................................        8,000          1,200           1,200
        Monticello.....................................................       25,558         34,250          22,000
        Pantex Plant...................................................       23,243         11,299          15,000
        Pinellas.......................................................        2,318          2,797           5,500
        Sandia National Laboratory.....................................       48,368         27,260          19,435
        UMTRA Ground Water Sites.......................................        5,559          5,902          13,000
        UMTRA Surface Sites............................................       35,936         20,782    .............
                                                                        --------------------------------------------
          Subtotal.....................................................      316,734        202,541         202,600
    Carlsbad area office: Waste Isolation Pilot Plant..................      173,700        185,404         186,404
    Chicago operations office:
        Ames Laboratory................................................          363            306             260
        Argonne Nat. Lab.--East........................................       15,921         18,170          19,761
        Argonne Nat. Lab.--West........................................        3,630          1,142             809
        Brookhaven National Lab........................................       26,137         30,001          29,553
        Chicago Operations.............................................          435          1,101             644
        Princeton Plasma Physics Lab...................................        3,290          3,343           3,073
                                                                        --------------------------------------------
          Subtotal.....................................................       49,776         54,063          54,100
    Idaho operations office: INEEL.....................................      415,556        435,642         409,422
    Nevada operations office:
        Amchitka.......................................................          848            765             592
        Central NTS/Project Shoal......................................        1,858          4,160           4,969
        Gasbuggy/Gnome Coach...........................................          235             66             278
        Nevada Test Site...............................................       64,985         73,045          76,673
        Rio Blanco/Rulison.............................................          160             75           2,669
        Salmon Site....................................................          832          1,970             126
                                                                        --------------------------------------------
          Subtotal.....................................................       68,918         80,081          85,307
    Ohio field office:
        Ashtabula......................................................       14,637         15,405          15,405
        Columbus.......................................................       12,567         12,125          16,134
        Fernald........................................................      258,700        274,002         280,589
        Miamisburg.....................................................       86,622         88,949          93,353
        Ohio Field Office..............................................  .............           94              94
        West Valley....................................................      113,746        107,353         107,353
                                                                        --------------------------------------------
          Subtotal.....................................................      486,272        497,928         512,928
    Oakland operations office:
        Energy Technology Engineering Center...........................       17,625         16,494          17,398
        General Atomics................................................        4,280          2,030           1,100
        General Electric...............................................  .............          313             500
        Lab. for Energy-Related Health.................................        6,802          4,389           3,863
        Lawrence Berkeley Nat. Lab.....................................        9,265         10,668          11,098
        Lawrence Livermore Lab.........................................       54,210         49,214          49,891
        Oakland Operations Office......................................        2,279          2,700           1,100
        Separations Process Res. Unit..................................  .............  .............           500
        Stanford Linear Accelerator Center.............................        1,006          1,000           1,400
                                                                        --------------------------------------------
          Subtotal.....................................................       95,467         86,808          86,850
    Oak Ridge operations office:
        Oak Ridge National Lab.........................................       49,439         59,677          57,805
        Oak Ridge Offsites.............................................       53,131         22,516          23,839
        Oak Ridge Operations Office....................................        5,027          8,809          10,930
        Oak Ridge Reservation..........................................      290,340        275,957         310,987
        Paducah Gaseous Diffusion Plant................................       39,582         35,983          37,500
        Portsmouth Gaseous Diffusion Plant.............................       43,053         35,119          37,500
        Weldon Spring \1\..............................................       66,686         63,500          52,000
                                                                        --------------------------------------------
          Subtotal.....................................................      547,258        501,561         530,561
    Rocky Flats field office:
        Rocky Flats Environmental Tech Site............................      611,303        638,397         637,132
        Rocky Flats Field Office.......................................       20,797         18,803          20,078
                                                                        --------------------------------------------
          Subtotal.....................................................      632,100        657,200         657,210
    Richland operations office:
        Hanford........................................................      906,861        953,001       1,028,280
        Richland Operations Office.....................................       44,536         45,491          36,831
                                                                        --------------------------------------------
          Subtotal.....................................................      951,397        998,492       1,065,111
    Savannah River operations office:
        Savannah River Ops Office......................................       28,117         33,157          30,280
        Savannah River Site............................................    1,099,806      1,181,789       1,192,220
                                                                        --------------------------------------------
          Subtotal.....................................................    1,127,923      1,214,946       1,222,500
    Other:
        Multi-Site Programs............................................      113,053         85,542          77,098
        Program Direction..............................................      345,000        337,073         349,409
        Science & Technology...........................................      269,213        243,156         230,500
        Ur/Th Reimbursement............................................       40,000         30,000          30,000
                                                                        --------------------------------------------
          Subtotal.....................................................      767,266        695,771         687,007
          EM Subtotal:                                                     5,632,367      5,610,437       5,700,000
              FFTF (trans to NE in fiscal year 1999)...................       41,727    .............  .............
              Y2K Supplemental Appropriation...........................  .............       13,840    .............
              Use of Uncosted Balances.................................      (11,253)       (20,658)   .............
          Total, traditional budget authority..........................    5,662,841      5,603,619       5,700,000
              Privatization............................................      200,000        228,357         228,000
                                                                        --------------------------------------------
          EM total.....................................................    5,862,841      5,831,976      5,928,000
    ----------------------------------------------------------------------------------------------------------------
    \1\ It is the intent of the Environmental Management Program to fund the Weldon Spring Site Remedial Action
      Project at a program level of $63.5 million. The Program will work to identify sources for this important
      activity.

    Savannah River Site, South Carolina Fiscal Year 2000 Request

                                 [In thousands]

    Defense, Site/Project Completion..............................  $397,636
    Defense, Post-2006............................................   824,864
                        --------------------------------------------------------------
                        ____________________________________________________

          Total................................................... 1,222,500

        The Savannah River Site continues its work to stabilize legacy
    nuclear materials and spent fuel from both the Savannah River Site and
    other sites across the complex, including plutonium residues and other
    plutonium-bearing materials from the Rocky Flats Site in Colorado. This
    work is critical both in resolving health and safety concerns about
    these radioactive materials, now in liquid or unstable forms unsuitable
    for long-term storage, and in supporting closure goals at Rocky Flats.
    In July 1997, the Secretary approved the operation of both the F-Canyon
    and H-Canyon, for the stabilization of ``at-risk'' nuclear materials.
    By the end of fiscal year 1998, these canyons had stabilized 3,500
    gallon of Pu-242 solutions, 80,000 gallons of Pu-239 solutions, 16,000
    corroding targets, and 144 canisters of failed or declad spent nuclear
    fuel. We expect to complete activities in the F-Canyon by fiscal year
    2002 and in the H-Canyon in fiscal year 2005.
        We are not requesting funding for the Actinide Packaging and
    Storage Facility (APSF) in fiscal year 2000. In light of the recent
    decision by the Department identifying Savannah River Site as the
    preferred location for new missions related to excess plutonium
    disposition, we have decided to temporarily suspend work on this
    facility until we can reevaluate the facility's overall requirements to
    ensure, for example, that the facility is properly sized and integrated
    with other facilities, given these new missions. We are, however,
    continuing modification of facilities in the K-Area and, pending
    completion of the appropriate NEPA analysis, will be ready to receive
    surplus plutonium-bearing materials from Rocky Flats in January 2000,
    supporting the accelerated closure of that site.
        Much of the EM work at the Savannah River Site that will be
    completed after fiscal year 2006 involves management of approximately
    34 million gallons of high-level waste in tanks, including vitrifying
    waste for final disposal and removing waste from storage tanks so the
    tanks can be closed. While this is a long-term project, we have made
    significant progress. In fiscal year 1998, the Savannah River Site
    workers closed another storage tank in the tank farm, removing waste
    and backfilling with grout, and produced 250 canisters of vitrified
    waste in the Defense Waste Processing Facility (DWPF), 50 canisters
    above their fiscal year 1998 target goal. As of first of March, we had
    a total of 588 canisters of vitrified waste in storage, or 11 percent
    of the total amount that needs to be produced.
        Our goal for production of canisters in fiscal year 2000, however,
    is lower. The budget request supports production of only 100 canisters
    at DWPF, primarily because of the need to devote resources to
    developing an alternative to the In-Tank Precipitation (ITP) facility
    that was to pre-treat certain wastes. ITP operations were terminated in
    January 1998 because we were unable to successfully pre-treat the waste
    and limit the levels of benzene generation in the tanks to a safe and
    manageable levels. We undertook a systems engineering analysis to
    evaluate all possible alternatives, which was reviewed by a panel of
    independent experts. Based on the review, we are pursuing three
    options, with a final selection of a technical approach expected in
    late fiscal year 2000.
        The fiscal year 2000 budget request continues support for receipt
    and storage at the Savannah River Site of spent nuclear fuel from
    domestic and foreign research reactors in support of national and
    international non-proliferation goals. In fiscal year 2000, we expected
    to receive 67 casks of spent nuclear fuel from foreign and domestic
    sources and safely store them at the Savannah River Site's basins. We
    will also continue to treat and reduce our legacy of mixed and low-
    level waste at the site through continued operation of the Consolidated
    Incinerator Facility.
        We will also continue the cleanup of contaminated release sites and
    contaminated ground water plumes at the Savannah River Site. In fiscal
    year 2000, we will complete remediation of six release sites and
    operate eight ground water remediation systems.
        Finally, scientists and engineers at the Savannah River Site have
    been collaborating to develop a cost-effective path forward for some of
    the spent fuel through research and development of new technologies.
    This work is helping to address one of our most daunting problems: how
    to manage spent nuclear fuel and other nuclear materials without
    chemical separations. Our investments in the Alternative Technology
    Program has shown progress. An Environmental Impact Statement
    identifying the ``melt-and-dilute'' process as the preferred
    alternative to prepare aluminum-based spent nuclear fuel for geologic
    disposal was issued in December 1998, and a final decision is expected
    in April 1999. The fiscal year 2000 budget contains funds for the
    design of a new facility to implement this treatment process. As other
    countries begin to address similar problems, these new U.S.-born
    technologies will be available to help.

    Hanford Site, Washington Fiscal Year 2000 Request

                                 [In thousands]

    Defense, Site/Project Completion..............................  $376,296
    Defense, Post-2006............................................   687,397
    Non-defense, Site/Project Completion..........................     1,418
    Defense, Privatization........................................   106,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Total................................................... 1,171,111

        The Hanford Site in Washington remains perhaps our greatest cleanup
    challenge. Originally carved out of 560-square mile site in a broad
    curve in the Columbia River during World War II, the Hanford site is
    home to the largest variety of environmental hazards in the former
    nuclear weapons complex, including large amounts of spent nuclear fuel,
    unstable weapons-grade plutonium, 177 underground high level
    radioactive waste tanks, and more than a hundred square miles of
    contaminated ground water. It is important not to lose site of the
    successes and accomplishments that have occurred despite the serious
    remaining challenges. We believe that our fiscal year 2000 budget
    request for Hanford addresses the requirements for continued cleanup
    progress. The Hanford budget is requested largely (65 percent) through
    the Post-2006 Completion Account and the Project/Site Completion
    Account (35 percent).
        One of the extraordinary success stories at Hanford during the past
    year was the success deactivation of the N-reactor complex, resulting
    in an annual mortgage cost reduction from $20 million to $500,000. This
    required:
      --deactivation of 86 facilities in the N-reactor area;
      --removal and treatment of more than a million gallons of
            contaminated water;
      --removal of nearly 5,000 cubic feet of contaminated sediment; and
      --retrieval and repackaging of 350 pounds of fuel fragments.
        The reactor complex is now in a low-cost ``surveillance and
    maintenance'' mode, pending final disposition, perhaps decades from
    now.
        In fiscal year 1998, we also completed the deactivation of the B
    Plant, one of Hanford's original World War II plutonium processing
    facilities, 4 years ahead of schedule and $100 million under budget.
    The deactivation reduced surveillance and maintenance costs at the
    Plant from $20 million to less than $1 million a year. Deactivation
    involved the disposal of 45,000 gallons of bulk hazardous chemicals,
    the transfer of 23,000 gallon of neutralized acid waste to the tank
    farms, and the removal and disposal of 10,000 ft3 of
    radioactive waste and equipment. The B plant deactivation also required
    the successful decoupling of the adjoining Waste Encapsulation and
    Storage Facility (WESF), which shared operating systems with B Plant.
    WESF stores highly radioactive cesium and strontium capsules and must
    continue to operate until the capsules can be dispositioned.
        The 177 underground tanks storing over 54 million gallons of highly
    radioactive waste remains one of the biggest challenges at the Hanford
    site. We have made significant progress in reducing the hazard of leaks
    from single-shelled tanks: to date, we have stabilized 64 tanks that
    have or are suspected of leaking by transferring free liquids to non-
    leaking double shelled tanks. Only three ``potential leakers'' remain
    to be stabilized, which will be completed following a mutually-agreed
    upon schedule negotiated with the State in fiscal year 1999.
        The Department is pursuing a privatization approach for obtaining
    treatment for the tank waste which, in Phase I, would provide treatment
    for at least 10 percent of the waste and 20 to 25 percent of the
    radioactivity in the tanks. In August 1998, we signed a contract with
    BNFL, Inc. that allowed for an initial 24-month period to enable the
    contractor to develop more of the design for the treatment facility and
    to obtain financing and submit a fixed price bid. In fiscal year 2000,
    the Department will decide whether to authorize BNFL to proceed to
    construction and operation, based on an evaluation of whether the
    proposal represents the best value for the taxpayer.
        Following Congressional direction in the Strom Thurmond National
    Defense Authorization Act for Fiscal Year 1999, the Department has
    established the Office of River Protection which will manage all
    aspects of our efforts to store, retrieve, treat, immobilize, and
    dispose of the high level waste from the tank farms. The Department has
    prepared an Integrated Management Plan, provided to Congress in January
    1999, which includes 27 new positions out of total of 109 positions
    that will staff the Office. The 27 positions have been advertised. In
    addition, we are proceeding expeditiously with the appointment of a
    manager for the Office of River Protection.
        We are continuing to dispose of contaminated soil and debris from
    environmental restoration operations at Hanford in the Environmental
    Restoration Disposal Facility (ERDF). Since opening two year ago, the
    Department has disposed of more than a million cubic meters of waste in
    the ERDF.
        We recently restarted stabilization operations for surplus
    plutonium stored in the Plutonium Finishing Plant. This is a critical
    step in the deactivation of the Plutonium Finishing Plant, which will
    substantially reduce risk and mortgage costs at Hanford.
        The Department also completed ``cocooning'' the C-reactor, one of
    the eight original reactor along the Columbia River. By deactivating
    and stabilizing the reactors in this manner, the department will be
    able to maintain the reactor in a safe and low cost status until final
    disposition is performed in 75 years.
        Despite some setbacks, we are moving forward with the long-term
    goal of cleaning up the Hanford site and making it available for
    community reuse or conservation based on a community involvement
    process appropriate to the large scale of the operation. For example,
    we are now evaluating issues associated with transferring the Wahluke
    Slope along the Columbia River in a manner that is protective of the
    river and responsive to community needs.
        Our fiscal year 2000 budget request supports a number of
    commitments, including:
      --A total of 14 waste site remediations are scheduled for completion
            in the 100 Area, and 2 more in the 300 Area, with 228,252
            m3 (302,366 tons) of soil removed, in addition to
            the completion of backfill of 10 waste sites.
      --Complete closure of cells 1 and 2 in Environmental Restoration
            Disposal Facility. Additionally 142,181 m3 (314,400
            tons) of soil will be disposed.
      --Implement Integrated Groundwater/Vadose Zone science and technology
            roadmap to support site assessment and remediation and system
            assessment capability development.
      --Waste Management activities include preparing about 130
            m3 of transuranic waste for shipment to WIPP;
            initiating disposal of about 2,500 m3 of mixed low-
            level waste; disposing of 3,800 m3 of low-level
            waste; and reducing about one million gallons of liquids in the
            high level waste tanks through the Evaporator.
      --Complete fuel retrieval, drying, transport and storage system
            testing to support commencement of fuel removal from the K-West
            basin in early fiscal year 2001.
      --Continue stabilization of 160 liters of plutonium bearing
            solutions, and about 238 containers of plutonium metals and
            oxides. Commence stabilization of about 600 kilograms of
            plutonium bearing residues and plutonium bearing polycube
            materials.

    Rocky Flats Environmental Technology Site, Colorado Fiscal Year 2000
    Request

                                 [In thousands]

    Defense Site Closure..........................................  $657,210

        Almost two-thirds (62 percent) of the Defense Closure Account
    request supports accelerated cleanup at the Rocky Flats Site, a
    facility located 16 miles northwest of Denver, Colorado. The site was
    used to shape plutonium and uranium weapons components and for other
    defense-related production work. The cleanup poses significant
    challenges because of the large amounts of plutonium and other
    compounds remaining in tanks and production lines in facilities, the
    significant volumes of hazardous and radioactive wastes stored
    throughout the site, and widespread contamination of soils, sediments,
    and groundwater.
        The Rocky Flats Site is one of the featured prototypes, and
    certainly the largest site, for our goal of accelerating site cleanup
    and closure by 2006. There are many challenges facing this project, but
    we are confident that by remaining focused on our goal we can produce
    substantial savings and provide dramatic risk reduction sooner then
    previously expected. Our current baseline is to complete cleanup and
    closure by 2010. The General Accounting Office is now assessing the
    status and obstacles to accelerated closure and is expected to report
    its results this Spring. The site contractor is still developing its
    baseline for accelerated closure. The accelerated closure baseline will
    be submitted to DOE in May 1999, and DOE is expected to complete its
    validation of the baseline in December 1999. Based on that revised and
    validated baseline, we expect to be able to describe in detail what is
    required to close the site by 2006 and provide our level of confidence
    in our ability to close by 2006. Whatever the result, we have clearly
    come a long way since the previous contractor estimated a few years ago
    that it would take $30 billion and 30 years to complete cleanup at
    Rocky Flats.
        The key ingredient for closing Rocky Flats is being able to move
    nuclear materials and waste off of the site. Making progress in this
    critical area requires not only preparing the materials and waste for
    shipment, but also making sure that the receiving sites are ready. For
    example, there are approximately 40,000 kilograms of plutonium residues
    that need to be packaged and sent to WIPP. We are currently modifying a
    facility to provide temporary storage. However, unless WIPP opens soon,
    we will need to provide further alternative storage for those residues;
    the fiscal year 2000 budget request for Rocky Flats does not include
    funds to construct such a storage facility. In sum, there are six sites
    in six states to which we need to ship waste and materials from Rocky
    Flats. In some cases we have already begun shipments, such as the
    dozens of truckloads of waste that have been already been shipped to
    Envirocare in Utah.
        The Department has clearly made enormous progress both in reducing
    risks at the site, and in greatly improving our management plans for
    cleanup and closure. Approximately 5 metric tons of plutonium residues
    were stabilized and/or repackaged in fiscal year 1998, and we expect to
    stabilize or repackage 32 metric tons in fiscal year 1999. By the end
    of fiscal year 1999, all pits and weapons-grade uranium will be shipped
    from Rocky Flats to other receiver sites, and about 99 percent of the
    residues are projected to be ready for shipment to WIPP or to Savannah
    River Site. We are making progress on demolishing buildings at Rocky
    Flats, not only reducing risks but also reducing mortgage costs
    required to maintain those excess buildings: all remaining glove boxes
    will be removed from Building 779 by the end of fiscal year 1999, and
    Building 729--part of the Building 779 cluster--will be completely
    demolished.
        The fiscal year 1999 appropriation and fiscal year 2000 budget
    request for Rocky Flats ($657 million each year) fund the activities we
    have already identified as necessary for accelerated closure. If our
    fiscal year 2000 request for Rocky Flats is fully funded, we are
    committed to producing the following results:
      --Demolishing the B-779 cluster of buildings, the first plutonium
            operations buildings in the world decontaminated and turned to
            rubble.
      --Ship more than 14,000 cubic meters of radioactive waste off site
            for disposal.
      --Process more than 60 metric tons of plutonium residues preparing
            for safe disposition.
      --Bring on-line a new plutonium packaging system and package 500 cans
            of plutonium.
      --Ship plutonium metals and oxides to the K-Area at the Savannah
            River Site beginning in January 2000, pending completion of
            NEPA requirements.
        The progress at Rocky Flats is also demonstrating the success of
    the Department's performance-based, integrating contractor strategy.
    Because award fees are based on meeting specific performance and safety
    goals, the contractor has a strong incentive to make progress on
    cleanup.
        We understand the importance of continuing to seek ways to
    accelerate cleanup at Rocky Flats to reduce risk and long-term costs.
    We also understand the vital role of accelerated site closure to the
    community where commercial and residential development along the
    Denver-Boulder corridor has reached nearly to the fence line of Rocky
    Flats.

    Idaho National Engineering and Environment Laboratory, Idaho Fiscal Year
    2000 Request

                                 [In thousands]

    Defense, Site/Project Completion..............................  $108,961
    Defense, Post-2006............................................   291,253
    Non-defense, Site/Project Completion..........................     9,208
    Defense, Privatization........................................   115,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................   524,422

        The fiscal year 2000 budget request for the Idaho National
    Engineering and Environmental Laboratory (INEEL) supports the receipt
    and safe interim storage of spent nuclear fuel, including Navy fuel and
    domestic and foreign research fuel; the storage and treatment of high
    level waste in 11 underground tanks; the cleanup of 43 ``release
    sites'', or contaminated areas, and 11 surplus facilities; and the
    management of legacy waste, including transuranic waste to be shipped
    to WIPP. Many of the critical activities at the site are subject to the
    Settlement Agreement signed with the Governor of Idaho in 1995, which
    would result in the suspension of shipments of spent nuclear fuel to
    INEEL if milestones are not met.
        One of the most complex challenges at INEEL is the remediation of
    buried wastes, such as remediation of the Radioactive Waste Management
    Complex, of which the Pit 9 site, a burial pit containing about 250,000
    cubic feet of radioactive waste, is a part. The Pit 9 project is now
    being conducted by the Management and Operating (M&O) contractor under
    an alternative approach supported by the state and EPA regulators
    following termination of the previous subcontractor. We began stage 1,
    the subsurface investigation, in October 1998, and have met all
    regulatory milestones to date. The Pit 9 cleanup was one of our first
    attempts at fixed-price contracting for a large and technically complex
    project, and both the Department and the contractor learned hard
    lessons from the experience. We are applying those lessons in other
    projects at the site and across the DOE complex.
        INEEL plays a key role in providing safe storage and management of
    spent nuclear fuel, in support of the Administration's non-
    proliferation goals. INEEL received its first shipment of foreign
    research reactor fuel in fiscal year 1998 and will continue to receive
    shipments in fiscal year 1999 and 2000. INEEL is actively improving
    storage conditions at the site, transferring fuel from wet to dry
    storage, or from aging facilities to modern, state-of-the-art
    facilities. For example, we are storing spent nuclear fuel and core
    debris from the Three Mile Island incident at the INEEL Test Area North
    and will begin moving the fuel from wet storage into dry storage at the
    end of this month. The Department has issued a request-for-proposal in
    a privatization initiative to procure a new facility for dry storage of
    other fuel, which will be licensed by the Nuclear Regulatory
    Commission. The fiscal year 2000 budget request includes $5 million for
    this project in the privatization account.
        A significant portion of the INEEL budget request supports the
    management of high level waste. INEEL has about 1.4 million gallons of
    liquid sodium-bearing waste stored in 11 underground tanks, and about
    135,000 cubic feet of calcined waste in temporary storage. In the near-
    term, we will continue to calcine the liquid, a process that converts
    the liquid waste into dry, granular material resembling laundry
    detergent; calcined waste is easier to store and is greatly reduced in
    volume. However, the calcining facility will be placed in standby mode
    on April 30, 1999, as required by the State, until an environmentally
    safe and economic path forward for the liquid and calcined waste can be
    identified. Development of an Environmental Impact Statement for the
    high-level waste alternatives is underway and expected to be finalized
    in fiscal year 2000.
        We continue our efforts to characterize and prepare transuranic
    waste for shipment to WIPP and to develop the Advanced Mixed Waste
    Treatment Project, a privatization project that will provide treatment
    for transuranic and alpha mixed low-level waste (waste that contains
    long-lived radionuclides at levels below those of transuranic waste).
    We are, however, in jeopardy of missing a milestone in the Settlement
    Agreement that requires that we initiate shipment of INEEL transuranic
    waste out of Idaho by April 30, 1999, because of the delay in opening
    WIPP. The Department considers compliance with the Agreement a top
    priority and is working to resolve this issue.
        INEEL now operates under the sponsorship of the EM program. As part
    of the long-range effort both to further the development of and
    capitalize on INEEL's core competencies, INEEL leads a major
    integration effort that uses a systems engineering approach to refine
    EM waste, spent nuclear fuel, and nuclear disposition baselines. The EM
    integration initiative evaluates cross-site and cross-program
    opportunities for efficiencies and cost reductions to streamline
    cleanup.
        Finally, the M&O contract for INEEL expires at the end of September
    of this year. Contract proposals are due in this month and the contract
    will be awarded in June 1999, providing for a three-month transition
    period. The current contractor, Lockheed Martin Idaho Technologies
    Company, has decided not to compete for the contract, so there will be
    a new contractor at the site in October. We will work to ensure a
    smooth transition that maintains continuity of the projects and
    schedules.

    Oak Ridge Reservation, Tennessee Fiscal Year 2000 Request

                                 [In thousands]

    Defense, Post-2006............................................  $264,561
    Non-defense, Post-2006........................................     3,802
    UE D&D Fund...................................................   135,198
    Defense, Privatization........................................    32,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................   435,561

        The Oak Ridge Reservation is comprised of three facilities--the Y-
    12 Plant, the East Tennessee Technology Park (ETTP) (formerly the K-25
    uranium enrichment facility), and the Oak Ridge National Laboratory
    (ORNL). Funding for almost all environmental management activities at
    Oak Ridge is included in the Defense, Post-2006 Completion Account,
    with funding for the cleanup of ETTP coming from both this account and
    the Uranium Enrichment Decontamination and Decommissioning Fund. In the
    fiscal year 2000, we are requesting that funding for some projects
    previously funded in the Non-Defense Account be provided in the Defense
    Account. We believe that consolidating funding under one account will
    provide more managerial integrity and may reduce indirect and overhead
    charges compared to funding these projects from multiple accounts.
        The Department continues its efforts to reindustrialize facilities
    in Oak Ridge, particularly at ETTP. The primary goal is to clean up
    ETTP as quickly and as safely as possible so that the presence of DOE
    and its contractors can essentially end, and the site can be reborn as
    an industrial park. As of November 1998, about 790,000 cubic feet of
    space has been leased to 43 private companies. In some cases, the
    Department has conducted cleanup of the building and, in other cases,
    the private company is undertaking the cleanup. Overall, we estimate
    $179 million in savings in life-cycle costs the Department would
    otherwise have to spend cleaning up or maintaining these surplus
    facilities. The Department is now in the process of developing a
    consistent DOE-wide policy for assuring that the health and safety of
    private industry workers at ETTP and other leased facilities are
    protected. In this way we will be better able to move ahead with more
    confidence in our path forward for this important program.
        The fiscal year 2000 request continues support for the
    decommissioning of the Molten Salt Reactor Experiment at ORNL. This
    experimental nuclear reactor was designed to use a fuel of highly-
    reactive uranium-233 blended with a molten salt coolant. After 4\1/2\
    years of operation, the reactor was shut down in December 1969. The EM
    program has begun to make substantial progress, with input from the
    National Academy of Sciences, in stabilizing this reactor. For example,
    the EM program has installed and continues operation of a system to
    remove reactive gases from the reactor tanks until the fuel salt can be
    removed. In fiscal year 2000, we plan to complete fabrication and
    testing of the uranium conversion equipment and complete planning and
    design of the fuel salt removal process.
        We have completed cleanup of the fourth of eight highly radioactive
    waste storage tanks, called the ``Gunite Tanks,'' at ORNL and have
    started work on the next tank, expected to be completed six months
    ahead of schedule. The tanks were built in 1943 and were used for waste
    from chemical separations (reprocessing) operations until the late
    1970's. The tanks vary in size, with some having a capacity of 170,000
    gallons (approximately the size of a 4-bedroom house). The estimated
    cost of the project is now $80 million, less than half the original
    estimate of $200 million. A key factor in the accelerated schedule has
    been the development of a variety of remote technologies, such as the
    ``Houdini'' vehicle and a robotic arm that provide access to the tank
    interior, which have allowed work to proceed on two tanks
    simultaneously, rather than sequentially as initially planned.
        The Toxic Substances Control Act (TSCA) incinerator at Oak Ridge,
    permitted by the State to treat mixed radioactive and hazardous wastes
    regulated by the Resource Conservation and Recovery Act and by EPA to
    treat PCB-contaminated wastes regulated under TSCA, offers unique
    capability within the DOE system. In addition to treating wastes
    generated by Oak Ridge facilities, the TSCA incinerator has also been
    used to treat wastes from other sites in the DOE complex, providing a
    cost-effective and integrated approach to managing these wastes.
    However, in February 1998 and again in February 1999, the Governor of
    Tennessee rejected the annual burn plans for the incinerator proposed
    by the Department, shutting off use of the incinerator for wastes
    generated at DOE sites other than those managed by the Oak Ridge
    Operations Office. The Governor cited equity concerns, including the
    lack of DOE sites available for disposal of waste from Oak Ridge and
    the adequacy of funding levels for environmental management at Oak
    Ridge, as well as the overall commitment of the Federal Government to
    the Oak Ridge site. The Department has assured the State leaders of our
    firm commitment to the site and is working to resolve State concerns.

    Fernald Environmental Management Project, Ohio Fiscal Year 2000 Request

                                 [In thousands]

    Defense Site Closure..........................................  $280,589

        The cleanup activities at Fernald Environmental Management Project
    account for more than $280 million, or 27 percent of the funding in the
    Defense Site Closure Account. The Fernald te, encompassing
    approximately 1,050 acres near Cincinnati, produced uranium for nuclear
    weapons from 1951 to the end of Cold War in 1989. Nearly forty years of
    uranium production for nuclear weapons left the Fernald Site with soil
    and groundwater contamination, a large backlog of wastes, including
    some unstable liquids, as well as stored nuclear materials such as
    depleted and enriched uranium. Several years of cleanup progress have
    included stabilization of liquid uranium solutions, off-site shipment
    of low-level waste, and deactivation, decontamination and demolition of
    several large industrial buildings at Fernald. The current baseline
    calls for cleanup to be completed by fiscal year 2008, but the
    Department is seeking enhanced efficiencies to complete work by fiscal
    year 2006. Groundwater remediation and long-term institutional controls
    will be necessary after active cleanup is completed.
        Last year we reported to you that we were beginning to dispose of
    waste in an on-site disposal cell. Site personnel realized that such a
    disposal cell would be required for some waste to keep disposal costs
    attainable, and the community realized constructing it at the Fernald
    site would be more equitable than demanding that all wastes be disposed
    of off-site in other states. I am pleased to report that we are
    successfully filling the first and second section of this disposal
    cell. We are now constructing a liner for section three. The
    availability of this on-site disposal cell is enabling us to accelerate
    disposal of contaminated soil and debris resulting from cleanup and
    building demolition.
        We also reported last year that we were expecting to begin
    excavating, treating, and shipping radioactive residue from the Waste
    Pits to an off-site disposal facility. We began excavation and loading
    of that material into railcars in February of this year and expect to
    begin shipments by rail for disposal in the April/May time frame.
        Finally, Fernald personnel have continued the process of razing
    deactivated and decontaminated industrial buildings. They completed
    demolition of 5 of the 11 major facility complexes (Plants 1, 4, 7, 9
    and the Boiler Plant), resulting in outyear reductions in mortgage and
    landlord costs.

    Waste Isolation Pilot Plant, New Mexico Fiscal Year 2000 Request

                                 [In thousands]

    Defense, Post 2006 Completion.................................  $186,404

        The Department is requesting funding at essentially the same
    funding level as appropriated in fiscal year 1999 for the Waste
    Isolation Pilot Plant (WIPP) in New Mexico.
        Opening and operating WIPP is a key element of the Department's
    strategy to provide for the permanent disposal of a portion of the
    Department's stored long-lived radioactive waste. Currently a large
    amount of transuranic waste (more than 100,000 cubic meters) is being
    stored at more than two dozen sites around the United States. In many
    cases, this waste has been stored for decades. By shipping this waste
    to WIPP for disposal, the Department will be able to reduce the number
    of sites where this type of waste is stored, reducing the costs of
    storing this waste and the long-term risks to the public and the
    environment. Opening WIPP for disposal is critical to the closure of
    sites such as Rocky Flats, where the site cleanup plan relies on
    disposal of the transuranic waste.
        Many of the schedules and requirements in the Federal Facility
    Compliance Act orders between the States or EPA, and DOE at the
    transuranic waste sites (e.g., INEEL and Rocky Flats) are based on the
    assumption that WIPP will open and begin accepting waste in the
    immediate future. In May of 1998, EPA certified WIPP for disposal of
    radioactive waste, and the Department declared WIPP ready to begin
    operations. We hope to make our first shipments this year, if pending
    litigation is resolved favorably. The Department is developing the
    necessary transportation capacity to move transuranic waste from sites
    where it is stored to WIPP to meet compliance agreement requirements.
    The Department continues to do everything possible to open WIPP and
    meet its legal obligations. The fiscal year 2000 budget will allow WIPP
    to continue disposal operations. The Department expects to ramp up the
    receipt rate of contact-handled transuranic waste shipments to 14
    shipments per week by the end of fiscal year 2000 and to 17 shipments
    by December 31, 2000.
        The WIPP program also funds a variety of institutional programs
    that provide economic assistance and operational oversight for affected
    governments and stakeholder groups. The funding request for fiscal year
    2000 includes $20.9 million for New Mexico Impact Assistance, as
    required by the WIPP Land Withdrawal Act Amendments of 1996, and
    additional funds for cooperative agreements with New Mexico Emergency
    Response, Indian Tribes, Southern States Energy Board, and others.
        The Department is relying on privatization to obtain the capital
    equipment for transuranic waste transportation to reduce costs. The
    fiscal year 1999 budget included $19,605,000 in the Defense
    Privatization account to transport remote-handled transuranic waste
    from generator sites to WIPP. Because this contract is not expected to
    be awarded until late fiscal year 1999 or early fiscal year 2000, the
    Department is not requesting additional funding in fiscal year 2000.

    Los Alamos National Laboratory, New Mexico Fiscal Year 2000 Request

                                 [In thousands]

    Defense, Post-2006 Completion.................................  $104,834
    Non-Defense, Post-2006 Completion.............................     6,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................  110, 834

        Our goal at Los Alamos National Laboratory is to complete cleanup
    work by 2006 except for a few complex contaminated sites and
    disposition of legacy transuranic waste, and to complete all EM cleanup
    projects at Los Alamos by 2015. Through fiscal year 1998, the
    Department completed remediation of 1,395 release sites and
    decommissioning of 41 facilities, out of a total of more than 2,000
    release sites and 130 facilities. We plan to complete 9 additional
    release sites and one facility in fiscal year 1999, and 28 release
    sites and two facilities in fiscal year 2000.
        The fiscal year 2000 EM budget request for Los Alamos of $110
    million is nearly $30 million more than our fiscal year 1999 budget.
    Much of this increase (86 percent) is devoted to environmental
    restoration work, such as drilling new regional ground water wells to
    characterize the hydrogeology and work required to complete cleanup in
    anticipation transferring land to the community. Pursuant to the
    requirements of Public Laws 105-119 and 105-245, DOE has identified ten
    parcels totaling about 4600 acres for potential transfer to the County
    of Los Alamos and the Pueblos, has published a draft Environmental
    Impact Statement on the land transfers and supporting Environmental
    Restoration Report, and will submit a detailed project plan for cleanup
    of a land parcel, referred to as ``TA-21'', to Congress by late March
    1999. DOE intends to follow a phased approach in accomplishing the land
    transfers, starting with the transfer of the relatively simple,
    uncontaminated parcels in 2000 and continuing with the transfer of the
    more complex sites in the outyears.
        Another significant increase in the Los Alamos budget is
    attributable to the need to manage wastes recently-retrieved buried
    transuranic waste and to characterize, certify, and ship the waste to
    WIPP for disposal. Los Alamos was the first site to have waste
    certified by DOE for disposal at WIPP. In fact, the WIPP certification
    rule that EPA promulgated in fiscal year 1998 specifically includes EPA
    approval of the characterization program at Los Alamos for certain
    transuranic wastes.
        The fiscal year 2000 request for EM does not include funds for
    management of on-going waste generation; the Department transferred
    this waste management responsibility at Los Alamos, along with funding
    responsibility, from EM to the Office of Defense Programs in fiscal
    year 1999.
        The Department recently designated Los Alamos as the lead
    laboratory for research and development efforts to support the
    Department's response to Defense Nuclear Facilities Safety Board
    Recommendation 94-1 on nuclear materials safety. In this capacity, Los
    Alamos provides solutions to complex-wide technical and operational
    issues associated with stabilization and storage of plutonium and other
    nuclear materials.

    West Valley Demonstration Plant, New York Fiscal Year 2000 Request

                                 [In thousands]

    Non-Defense, Site Closure Account.............................  $107,353

        Cleanup of the West Valley Demonstration Project (WVDP), located in
    upstate New York less than 40 miles from Buffalo, is being conducted at
    the site of the only nuclear fuel reprocessing facility to operate in
    the U.S. The private company processed commercial spent nuclear fuel to
    extract plutonium and uranium from 1966 to 1972, generating 2,200 cubic
    meters of liquid high-level waste.
        The principal operation at West Valley is the solidification of the
    liquid high-level waste into borosilicate glass using a process called
    vitrification. The primary vitrification campaign began in June 1996
    and was completed ahead of schedule in June 1998. Vitrification of the
    high-level waste tank heels is currently underway and will continue
    through fiscal year 2001.
        Following the vitrification of the high-level waste, the equipment
    and facilities used in carrying out the project will be decontaminated
    and decommissioned, based on the results of an Environmental Impact
    Statement (EIS) and Record of Decision (ROD) for the completion of the
    project. This phase of the cleanup project is expected to begin in late
    fiscal year 2000.
        The New York State Energy Research and Development Authority and
    DOE are working together and with stakeholders, including a Citizens'
    Task Force, to formulate a preferred alternative for closure or long-
    term management of the site. Selection of a preferred alternative and
    subsequent ROD will determine the outyear scope of work for the project
    and final disposition of the waste. The EIS and ROD process is
    scheduled to be completed in May 2000. The estimated completion date
    for WVDP may extend through 2015, reflecting the uncertainty related to
    the future EIS ROD.
        Another critical element of the EM program at West Valley is the
    safe management of 125 spent nuclear fuel elements stored at the site.
    EM will continue surveillance and maintenance of the spent fuel
    facility to ensure safe storage until the spent fuel can be shipped to
    the Idaho National Engineering and Environmental Laboratory (currently
    planned for 2001).
        In fiscal year 1999, major activities include continuation of
    vitrification of the HLW tank heels (producing approximately 15
    canisters of solidified HLW), development of an EIS Preferred
    Alternative for project completion, progress towards resolution of
    responsibility issues with the State of New York, and continuation of
    preparations for shipment of spent nuclear fuel.
        In fiscal year 2000, major activities include continuation of
    vitrification of the HLW tank heels (producing approximately 5
    canisters of solidified HLW), issuance of a Final EIS and ROD for
    project completion, and continuation of preparations for shipment of
    spent nuclear fuel.

    Miamisburg Environmental Management Project (Mound Site) Fiscal Year
    2000 Request

                                 [In thousands]

    Defense Site Closure..........................................   $92,353
    Non-Defense, Site Closure.....................................     1,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................    93,353

        The Miamisburg Environmental Management Project, a 306-acre
    facility near Dayton Ohio used for tritium and plutonium-238
    operations, consists of 416 release sites and 111 facilities. We have a
    goal of completing cleanup of the site by 2005 or earlier. We are
    making good progress--all legacy bulk tritium has been shipped off-
    site, and a consolidated treatment processing facility and a
    radioactive wastewater treatment facility have been constructed and are
    in use. In fiscal year 1998, we completed remediation of the Miami-Erie
    Canal, allowing re-establishment of a park for the local community. In
    fiscal year 1998, we demolished or removed 25 buildings out of an
    initial inventory of 106 buildings scheduled for demolition or removal
    and will complete another 5 in fiscal year 1999, adding to the 17
    buildings that had been demolished or removed before fiscal year 1998.
        We have negotiated an agreement to transfer the ownership of the
    site to the Miamisburg Mound Community Improvement Corporation as
    cleanup is completed. Currently 28 private businesses employing more
    than 250 workers are leasing facilities at the Mound Site. Within the
    next few months, we plan to transfer ownership to the community of the
    first parcel of land, consisting of two buildings currently occupied by
    private businesses. This transition process will allow the Department
    to eventually leave the site without creating an economic void in the
    community.

    Nevada Test Site and Operations Office, Nevada Fiscal Year 2000 Request

                                 [In thousands]

    Defense, Post 2006 Completion.................................   $85,307

        The Post-2006 Completion Account includes $85 million for cleanup
    and waste management activities at the Nevada Test Site, as well as
    funds to remediate eight other inactive sites contaminated by past DOE
    nuclear testing in five other states (Alaska, Colorado, Mississippi,
    Nevada, and New Mexico). The Nevada Test Site (NTS) is located 65 miles
    from Las Vegas and encompasses 1,350 square miles, an area roughly the
    size of Rhode Island. In addition to the cleanup of radioactive
    contamination resulting from above- and below-ground testing of nuclear
    weapons and management of its on-site waste, the Nevada Test Site plays
    a crucial role for other DOE sites as one of the major low-level waste
    disposal facilities in the DOE complex. By fiscal year 2006, the
    Department expects to complete restoration of the surface area of off-
    site locations and complete shipments of transuranic waste to WIPP,
    while continuing to operate low-level disposal facilities at NTS for
    the DOE complex. institutional controls and to maintain groundwater
    monitoring.
        In fiscal year 1999, the Department expects to meet its commitment
    to dispose of more than 37,000 cubic meters of low-level waste, more
    than half of which is from other DOE sites, and to complete cleanup of
    446, or 32 percent of the contaminated release sites. In fiscal year
    2000, the Department is committing to disposing of 64,000 cubic meters
    of low level radioactive waste at NTS--a 70 percent increase over
    fiscal year 1999. Based on new scientific findings about transport of
    plutonium and other actinides in ground water, the Department is
    increasing it efforts to monitor ground water at NTS to improve our
    understanding of this complex issue. We also plan to continue treating
    transuranic waste in fiscal year 2000 for shipment and disposal WIPP.

    Weldon Spring Remedial Action Project, Missouri Fiscal Year 2000 Request

                                 [In thousands]

    Non-Defense, Site Closure Account.............................   $52,000

        The Weldon Spring Site Remedial Action Project (WSSRAP) in Missouri
    includes a decommissioned uranium processing plant, an abandoned quarry
    used as a dump site, as well as numerous vicinity properties that were
    contaminated by uranium processing operations conducted for nuclear
    weapons support in the 1950's and 1960's, similar to the Fernald Site
    in Ohio. The Oak Ridge Operations Office in Tennessee is managing the
    cleanup, which includes about one million cubic yards of waste at the
    229-acre site.
        Cleanup of the Weldon Spring Site is expected to be completed as
    early as 2002. All contaminated material will be placed in an on-site,
    above-grade cell for permanent disposal. Long-term surveillance and
    monitoring for the disposal facility will be conducted after project
    completion, and the remaining land will be released for unrestricted
    use.
        Our progress in fiscal year 1998 and fiscal year 1999 puts us on
    track for completing cleanup in 2002. Fiscal year 1998 marked the start
    of the waste placement in the 1.4 million cubic yard capacity disposal
    facility, with about 640,000 cubic yards of material being placed in
    the facility in fiscal year 1998. The construction of the Chemical
    Stabilization and Solidification Facility was completed and treatment
    of waste pit sludge begun in fiscal year 1998, with treatment of sludge
    completed in fiscal year 1999. Cleanup of all vicinity properties but
    one were completed. The site Groundwater Record of Decision will be
    signed, and Quarry restoration activities will begin in fiscal year
    1999.
        In fiscal year 2000, the waste placement activity will be nearly
    completed, and the construction of the disposal facility cap will
    begin. Quarry restoration will continue, and the chemical plant site
    restoration and waste pit remediation will begin. Although the fiscal
    year 2000 budget targets $52 million for Weldon Spring, it is the
    intent of the Department to fund this program at a level of $63.5
    million, the level of funding of fiscal year 1999, to ensure the 2002
    completion date can be attained.

    Brookhaven National Laboratory, New York Fiscal Year 2000 Request

                                 [In thousands]

    Non-Defense, Site/Project Completion Account..................   $29,553

        At the Brookhaven National Laboratory, we are treating contaminated
    groundwater at several on-site locations and will start the first off-
    site groundwater treatment system by the end of this fiscal year. Over
    1,500 homes have been hooked up to the municipal water supply to ensure
    that the residents' drinking water supply remains unaffected during
    long-term ground-water cleanup. To eliminate sources of potential
    future contamination, we have removed buried waste as well as a number
    of underground storage tanks and cesspools, and have capped on-site
    landfills. In fiscal year 1999, the Department expects the regulatory
    and stakeholder review process for proposed cleanup remedies to be
    completed, and the final remedies to be identified for contaminated
    soils, sediments and groundwater. We will begin implementing the final
    remedies in fiscal year 2000.
        A site-wide review in fiscal year 1997 highlighted concerns with
    the Brookhaven Graphite Research Reactor, due in part to the
    radioactively contaminated water collecting in underground air ducts
    associated with the facility. I am pleased to report substantial
    progress in addressing this concern through the combined efforts of
    this office and the Office of Science. The contaminated water has been
    removed, and sources of potential further water intrusion have been
    sealed off. Moreover, the Offices of Science and Environmental
    Management have reached agreement on managing the remaining
    characterization, stabilization, and decommissioning of the Research
    Reactor, and both offices have committed funding in fiscal year 1999
    and fiscal year 2000 to maintain the momentum on this project. Final
    decommissioning of this facility is scheduled to begin in fiscal year
    2001.
        The EM Program will continue its activities in fiscal year 2000 to
    dispose of legacy wastes and will also continue to compliantly store,
    treat, and dispose of wastes generated by on-going Brookhaven
    operations, with the transfer of waste management responsibilities to
    the generating program expected in fiscal year 2001.

    Sites in the State of California Fiscal Year 2000 Request

    Defense, Site/Project Completion Account:s]
        Lawrence Livermore National Laboratory....................   $49,891
        Oakland Operations Office.................................       800
    Non-Defense, Site/Project Completion Account:
        Energy Engineering Technology Center......................    17,398
        Lawrence Berkeley National Laboratory.....................    11,098
        General Atomics...........................................     1,100
        Laboratory for Energy-Related Health Research.............     3,863
        Stanford Linear Accelerator Center........................     1,400
        General Electric..........................................       500
        Oakland Operations Office.................................       300

        A total fiscal year 2000 request of $86,350,000 supports activities
    at the seven sites in California. The funds will support the
    characterization, remediation, decontamination and decommissioning of
    contaminated release sites and facilities; waste minimization efforts;
    and management of hazardous and radioactive wastes generated at sites.
    We are committed to completing cleanup at all sites by 2006, including
    shipping legacy waste off-site, ending EM responsibilities. For those
    sites with on-going Departmental missions, we plan to transfer
    responsibility for managing newly generated wastes to the waste
    generating programs by fiscal year 2003, and transfer responsibility
    for long-term maintenance of completed remedial actions (e.g., pump and
    treat facilities) and surveillance and monitoring by fiscal year 2006.
        The major accomplishments expected for fiscal year 2000 include:
        Lawrence Livermore National Laboratory.--LLNL consists of two
    sites--the Main site and Site 300. We will complete the Site-Wide
    Proposed Plan for the Interim Record of Decision at Site 300. At the
    Main site, EM will activate and start operational testing of the
    Decontamination and Waste Treatment Facility at the Lawrence Livermore
    National Laboratory Site and complete deployment of electro-osmosis
    innovative technology in source area contaminant remediation, for a
    potential life cycle savings of over $50M and reduction in time for
    cleanup of over 40 years compared to conventional pump and treat
    technology. We plan to complete cleanup at the LLNL sites by 2006.
        General Atomics.--EM will finish all cleanup activities in fiscal
    year 2000 with the completion of decontamination and decommissioning
    activities at the Hot Cell Facility, formerly used by DOE for nuclear
    research and development.
        Laboratory for Energy-Related Health Research.--We will complete
    soil excavation at the western dog pen and Strontium-90/Radium-226
    Areas in fiscal year 2000, keeping us on schedule for completing
    overall site cleanup, including off-site waste disposal, by fiscal year
    2002.
        Energy Technology Engineering Center.--The Department signed a
    contract in December 1998 with Boeing North America, the owner of this
    facility, to complete cleanup by 2006. The contract calls for transfer
    of all facilities and land to the owner, who will take responsibility
    for any long-term stewardship needed for the completed remedies. In
    fiscal year 2000, we will complete the decontamination and
    decommissioning of the SNAP-8 facility and the H-1 Heater Facility.
        Stanford Linear Accelerator Center.--We will complete excavation of
    PCB-contaminated soils in the Lower Salvage Yard. Responsibilities for
    on-going waste management were transferred to the generator in fiscal
    year 1997. We expect to complete EM's cleanup responsibilities by 2002.
        Lawrence Berkeley National Laboratory.--Excavation of contaminated
    soils at several on-site locations at Lawrence Berkeley National
    Laboratory will continue, as will storage, treatment and disposal
    activities to reduce legacy waste, with a goal of completing EM
    responsibilities by 2003.

                          statement of lake h. barrett

        Senator Domenici. We will proceed now with Mr. Barrett, and
    then we will ask questions.
        I note the presence of Senator Wayne Allard, from Colorado.
    Would you like to comment now before we proceed with the
    witness?
        Senator Allard. Well, I have a statement I would like to
    make, if that is okay with the Chairman, if it is appropriate
    for your agenda this morning.
        Senator Domenici. What is your time schedule for this
    morning?
        Senator Allard. Well, I need to preside at 11:00 o'clock,
    and I want to thank the Chairman for letting me sit here on
    your subcommittee.
        Senator Domenici. You are welcome. Let me proceed with the
    witnesses, and I will give you a chance here shortly.
        Senator Allard. Thank you.
        Senator Domenici. Mr. Barrett.
        Mr. Barrett. Thank you very much, Mr. Chairman, and members
    of the committee.

                              viability assessment

        We, in the Civilian Waste Radioactive Waste Management
    Program, have made significant progress in the last year.
    Specifically, we completed the Viability Assessment, which was
    sent to this committee and the President, and the rest of the
    Congress.
        The Viability Assessment found that there were no
    showstoppers and that work should proceed in characterizing the
    Yucca Mountain site. This Administration continues to move
    forward with the scientific characterization of Yucca Mountain,
    progressing toward a national decision whether the site is
    suitable to be a geologic repository. We are now nearing the
    conclusion of our scientific site characterization effort.
        The President's fiscal year 2000 budget request supports
    the Viability Assessment's findings. It is important to note
    that we still have work to do. The budget request, building on
    the scope of work identified in the Viability Assessment,
    spells out what we plan to do in fiscal year 2000 to support
    the decision process in the coming years.

                            yucca mountain schedule

        The overall schedule for the Yucca Mountain activities is
    shown on this chart to your right. We are on target for a
    decision in 2001 whether Yucca Mountain is suitable to be the
    location of a geologic repository, and if the site is suitable,
    to submit a License Application to the Nuclear Regulatory
    Commission in 2002.
        Meeting those milestones will maintain a schedule for the
    start of waste emplacement in 2010, if the site is suitable and
    licensed.
        Your continued support for this program is essential. This
    program is essential to our national policy for the management
    of commercial spent nuclear fuel, the cleanup of our defense
    nuclear facilities, the disposition of our naval nuclear spent
    fuel, and the disposition of surplus plutonium to support the
    nation's nuclear non-proliferation goals in this post-Cold War
    period.

                             recent accomplishments

        Before I discuss the 2000 fiscal year budget request, I
    would like to give you a brief summary of our recent
    accomplishments. We are focusing on the work products to
    support the milestones on this chart.
        They are specifically the Draft Environmental Impact
    Statement in the summer of this year, the Final Environmental
    Impact Statement in 2000, a determination if the site is
    suitable for a recommendation to the President in 2001, and a
    License Application, if the site is suitable in 2002.
        Last year, as I noted, we completed the Viability
    Assessment. That assessment served to identify the critical
    issues that must be addressed before a decision may be made by
    the Secretary whether to recommend the Yucca Mountain site for
    development as the nation's first repository. Our fiscal year
    2000 budget request implements the work plan to address those
    issues to allow a final national decision.
        At Yucca Mountain, we are working to understand the key
    scientific issues, including the flow of water through the
    repository, and the effect of heat from waste packages on the
    geology and the hydrology.
        We are investigating design alternatives to enhance
    performance. Our understanding of those issues will help reduce
    the uncertainties related to the performance of a repository.
    Now I would like to turn specifically to the fiscal year 2000
    budget request.

                        fiscal year 2000 budget request

        We are requesting $370 million in new budget authority and
    the release of $39 million from the funds appropriated in
    fiscal year 1996 in the Defense Nuclear Waste Disposal
    Appropriation, for a total funding of $409 million. We have
    proposed allocating $332 million to continue the scientific and
    engineering work at the Yucca Mountain site characterization
    program, $6 million for waste acceptance, storage, and
    transportation, and $71 million for program management, which
    includes our nuclear quality assurance and regulatory and
    National Environmental Policy Act responsibilities.
        The $332 million devoted to the Yucca Mountain site
    characterization will be used to continue the necessary
    cutting-edge scientific and engineering work to implement the
    characterization of the Yucca Mountain site; to reduce the
    remaining uncertainties about the site's performance, by
    developing models that predict the geophysical and engineering
    performance; to further refine our repository and waste package
    designs; to assist in the assessment of the repository safety
    strategy and total system performance. This includes the
    flexibility to incorporate emerging new technologies, such as
    accelerator transmutation of waste, which could supplement and
    improve the performance of a repository in Yucca Mountain. We
    also are working to finish the environmental impact statements.
        In addition to the hard science and engineering technical
    activities under way at Yucca Mountain, we believe that the
    financial support envisioned by the Nuclear Waste Policy Act to
    the state and units of local government is important in
    enabling these governments and citizens directly adjacent to
    the Yucca Mountain project to remain informed and to
    participate in a meaningful way in the day-to-day program
    actions that may affect them. To that end we seek your approval
    of our request for such funding.
        The budget request for the waste acceptance storage and
    transportation program is $6 million. This request will support
    our continuing long-lead work that must proceed transporting
    spent fuel to a federal receiving facility, and continue
    interactions with the standard contract holders to discuss how
    best to accommodate the delay in the acceptance of spent fuel
    from commercial utilities.
        In the program management area the $71 million requested
    will support the Nuclear Regulatory Commission mandated nuclear
    quality assurance activities, regulatory compliance, program
    control and management activities. The funding requested also
    provides core support for the Nuclear Waste Policy Act mandated
    EIS's, the planning and program management, and the extensive
    records management systems that we must have.

                               concluding remarks

        As I noted in my opening remarks, we have made substantial
    progress and we are appropriately positioned to finish the site
    characterization effort. The Viability Assessment found that
    there were no ``showstoppers'' with respect to the site at
    Yucca Mountain.
        They also identified the necessary remaining scientific and
    technical work we have to complete, and provided the funding
    profile required, which our fiscal year 2000 budget request is
    based upon.
        Funding at our request level will give us the resources
    required to address the last remaining questions about the
    suitability of the Yucca Mountain site. We are committed to
    determining the suitability of the site, and we seek your
    support in our efforts toward moving through this critical
    national decision.

                               prepared statement

        Thank you for your support, and I would like to answer any
    questions that you may have.
        Senator Domenici. Thank you very much.
        [The statement follows:]

                     Prepared Statement of Lake H. Barrett

        Mr. Chairman and members of the Committee, I am Lake H. Barrett,
    Acting Director of the Department of Energy's Office of Civilian
    Radioactive Waste Management. I appreciate the opportunity to present
    our fiscal year 2000 budget request to you and discuss our plans for
    continuing to move forward with the scientific and technical program
    activities at the Yucca Mountain site in Nevada.
        The fiscal year 2000 budget request of $409 million is devoted to
    supporting principally those activities that may lead to a decision to
    recommend the site currently being characterized at Yucca Mountain,
    Nevada for development of a repository for the Nation's spent nuclear
    fuel and high-level radioactive waste.
                                   background
        The Civilian Radioactive Waste Management Program and, in
    particular, the Yucca Mountain Site Characterization Project being
    implemented is the cornerstone of the national policy for the
    management of spent nuclear fuel produced by nuclear power reactors for
    the generation of electricity and the clean-up of the high-level
    radioactive waste currently stored at sites that were key facilities of
    the nuclear weapons complex. The Civilian Radioactive Waste Management
    Program also directly supports the requirement to dispose of the
    Department of Energy's spent nuclear fuel including naval nuclear spent
    fuel. The disposition of surplus plutonium and other nuclear weapons
    materials in a permanent geologic repository is a key factor in
    maintaining the United States' international leadership position
    regarding nuclear nonproliferation.
        Since the enactment of the Nuclear Waste Policy Act in 1982, we
    have made significant progress. We have designed and are implementing a
    program that is leading the developed countries in planning for
    geologic disposal of spent nuclear fuel and high level waste. Despite
    the progress made, the implementation of this program continues to be
    one of the most daunting public policy challenges before us. The
    Department, is however, getting closer to being able to make a decision
    regarding the recommendation of the site to the President for
    development as a repository, if it proves to be suitable.
                              viability assessment
        Since I last appeared before you, the Department completed, and
    submitted to the President, the Congress, and the public, the Viability
    Assessment of a Repository at Yucca Mountain and its companion
    documents. The Viability Assessment is comprised of four major
    elements: (1) a preliminary design concept for a repository and waste
    package; (2) a total system performance assessment that describes the
    probable behavior of a repository in the Yucca Mountain geologic
    setting; (3) a plan and cost estimate for the remaining work required
    to complete and submit a License Application to the Nuclear Regulatory
    Commission; and (4) an estimate of the costs to construct and operate a
    repository.
        The Viability Assessment is the compilation of over fifteen years
    of scientific and engineering work at the Yucca Mountain site. It
    provided Congress, the President, and the public with information on
    the progress of the Yucca Mountain Site Characterization Project. The
    Viability Assessment serves as an important management tool for the
    Program to guide the completion of site characterization by identifying
    critical issues that need to be addressed before a decision can be made
    by the Secretary on whether to recommend the Yucca Mountain site for a
    repository.
        The key conclusion of the Viability Assessment is that there are no
    ``show stoppers'' with respect to the Yucca Mountain site and that work
    should proceed to support a decision in 2001 on whether to recommend
    the site. The President's fiscal year 2000 budget request supports that
    conclusion and I seek your support as well. It is important to note
    that we still have work to do. The budget request, building off of the
    scope of work identified in the Viability Assessment, spells out, in
    some detail, what we plan to do in fiscal year 2000 to support the
    decision process in the coming years.
        The Civilian Radioactive Waste Management Program, in accordance
    with the guidance provided by the Fiscal Year 1997 Energy and Water
    Development Appropriations Act, applied the majority of our funding and
    two years of focused, concentrated effort to the development of the
    Viability Assessment. The Viability Assessment having been issued only
    three months ago, now provides both the short-term and long-term
    planning basis for the Program. It lays out the scope of work and the
    cost profile for the remaining work that must be accomplished to not
    only reach the decision point regarding the recommendation of the site
    to the President, if the site is found to be suitable, but also the
    work that must be accomplished and costs associated with it to
    construct a repository subsequent to receiving a License from the
    Nuclear Regulatory Commission. It is being used by the Program as a
    point of departure for developing and implementing the planning
    baseline against which Congress and outside observers may measure our
    progress in the future.
        We have also made the Viability Assessment widely available by
    putting it and its companion documents The Analysis of the Total System
    Life Cycle Cost of the Civilian Radioactive Waste Management Program,
    December 1998 (Total System Life Cycle Cost Report) and the statutorily
    required Nuclear Waste Fund Fee Adequacy: An Assessment, December 1998
    (Fee Adequacy Report), and all the supporting technical studies--on our
    Internet home page.
                                   litigation
        Before I discuss the fiscal year 2000 budget request and some of
    the accomplishments in fiscal year 1998 and fiscal year 1999, I would
    like to touch briefly on the ongoing litigation with State agencies and
    utilities regarding the Department's delay in accepting commercial
    spent fuel.
        As you know, the Department is in litigation over our inability to
    meet our contractual obligation to accept spent fuel from the nuclear
    utility companies by January 31, 1998. The Court of Appeals for the
    District of Columbia Circuit found that the Department has an
    obligation to commence spent fuel disposal by January 31, 1998. The
    Court denied the utilities' and States' request for a move-fuel order,
    finding that the Standard Disposal Contract provides a potentially
    adequate remedy. The Court stated that the Department may not rely on
    the ``unavoidable delays'' clause to excuse its delay in performance
    and suggested the ``avoidable delays'' clause of the Standard Contract
    as the potentially adequate remedy. This clause provides for an
    equitable adjustment of schedules and contract charges to reflect any
    estimated additional costs incurred by the contract holder.
        Pursuant to the ruling of the Court of Appeals for the District of
    Columbia Circuit, the Department will process claims presented to it
    under the standard disposal contract. Although we have held settlement
    discussions with several utilities, only one utility has proposed a
    bilateral modification and request for equitable adjustment of the
    contract, and no formal claims have been filed.
        To date, ten utilities have filed claims for monetary damages in
    the U.S. Court of Federal Claims. In the first three cases decided by
    the Court, the Department was found to have breached its contracts with
    three utilities, each with only one shutdown reactor, and the
    Department is now engaged in discovery to determine the amount of
    damages the Government must pay these utilities. Other cases, most
    involving utilities with operating reactors paying ongoing fees to the
    Department, are currently pending.
                               quality assurance
        Our Quality Assurance Program, working as it should, has detected
    certain deficiencies in the execution of the Yucca Mountain Site
    Characterization effort, which has resulted in a redirection of work to
    respond to these deficiencies. Corrective Action Plans approved by our
    Office of Quality Assurance are being implemented. Process improvements
    have been identified, procedures have been revised, training is
    underway, and managers have increased their self-assessments. Although
    these efforts are causing us to refocus and redefine some of our
    currently planned work, we anticipate that we can accommodate this
    effort with minimal impact on cost and schedule. We expect some of the
    analyses, however, may have to be based on less data than previously
    planned but we are confident that the analyses will support the Site
    Recommendation Report and License Application.
          payments to the state and affected units of local government
        We believe that the support envisioned by Section 116(c) of the
    Nuclear Waste Policy Act of 1982, as amended, to the State and units of
    local government affected by site characterization activities is
    important in enabling local governments and the citizens most directly
    impacted by the Yucca Mountain Project to remain informed and to
    participate in a meaningful way in the day to day program actions that
    affect them. Financial support is particularly important for the rural
    counties' programs where financial resources are severely limited and I
    would urge that you support the funding requested.
                      summary of fiscal year 2000 request
        With respect to fiscal year 2000, we are requesting $370 million in
    new budget authority and the release of $39 million from funds
    appropriated in fiscal year 1996 in the Defense Nuclear Waste Disposal
    Appropriation (currently in a Congressional Reserve) for total funding
    of $409 million. This request level fully supports the funding profile
    for the scientific and engineering activities planned for the Yucca
    Mountain Project as described in the Viability Assessment.
        We have proposed allocating $332 million to continue the scientific
    and engineering work at the Yucca Mountain Site Characterization
    Office; $6 million for the activities directed by the Office of Waste
    Acceptance, Storage and Transportation; $10 million for the Program's
    Nuclear Quality Assurance program; and $61 million to carry out the
    Program's Management and Integration functions.
        Before I review with you how we are proposing to use the funds
    provided for in the fiscal year 2000 budget request, I would like to
    briefly highlight, in summary fashion, some of the fiscal year 1998 and
    projected fiscal year 1999 accomplishments.
               fiscal year 1998-fiscal year 1999 accomplishments
                                 yucca mountain
        At the Yucca Mountain Site Characterization Project Office, we are
    continuing the transition from a project whose principal focus was on
    the collection of scientific data to a project that is increasingly
    focused on activities that support the remaining key near-term
    requirements described in the Nuclear Waste Policy Act of 1982, as
    amended. Those key activities will provide the remaining technical
    documentation (collectively these materials are referred to as the
    ``Site Recommendation Report''), to support whether the Secretary
    should recommend to the President the site currently being
    characterized at Yucca Mountain, Nevada, if the site is found to be
    suitable, as a repository for the Nation's spent nuclear fuel and high-
    level radioactive waste.
        In fiscal year 1999, the Program applied $282 million to the site
    characterization effort at Yucca Mountain. That was almost 80 percent
    of the Program's total appropriation.
        The Project is focusing their activities on scientific and
    engineering investigations related to the remaining key uncertainties
    about the Yucca Mountain site. Those uncertainties were discussed in
    the Viability Assessment. They include the presence and movement of
    water through the repository block; the effects of water movement on
    the waste package; and the effects of heat from the decay of
    radioactive materials inside the waste packages on the site's geologic
    and hydrologic behavior.
        The focus at Yucca Mountain during fiscal year 1998 was on
    completing the Viability Assessment, completing excavation of, and
    starting testing in, the Exploratory Studies Facility Cross Drift that
    extends to the west side of the repository block, and on starting one
    major thermal test and completing two others.
        Development of the Viability Assessment represented many ``firsts''
    for us. It was the first time we have articulated our integrated
    understanding about the whole Yucca Mountain Site since the 1986
    Environmental Assessment supporting the decision to carry out site
    characterization. It was the first time an integrated technical review
    of one of our major technical reports included members of the
    Department of Energy complex who currently have responsibility for
    waste forms planned for geologic disposal. It was the first time we
    have used the Internet as an important part of our process for
    distributing major technical reports to the public. Lessons we have
    learned from these activities are being implemented as we start
    developing the Site Recommendation Report and the License Application.
    In addition to the Viability Assessment, we produced key supporting
    documents such as the Total System Performance AssessmentViability
    Assessment Analysis Technical Basis Document and the Yucca Mountain
    Site Description.
        In December 1997, we started excavation of the 16.5-foot diameter
    cross drift in the Exploratory Studies Facility to better understand
    the geologic and hydrologic conditions of the west side of the
    repository block. By the close of fiscal year 1998, we completed
    excavation of over 2578 meters. The remaining 103 meters were completed
    in October 1998. Geologic mapping of the cross drift has been
    completed. Model predictions of the stratigraphy of the cross drift
    were verified to be within a few meters in elevation of the actual
    stratigraphic contacts. The eastern splay of the Solitario Canyon fault
    was mapped, and showed the actual offset to 220 to 230 meters matched
    the predicted offset of 230 meters.
        Long duration tests are providing critical input for validating
    models we use to predict performance of a repository. We designed three
    different thermal tests to evaluate how the high temperatures in a
    repository (from heat generated by radioactive decay of the emplaced
    waste) can affect the natural barriers (i.e., the rock surrounding the
    emplacement drifts) and the engineered barriers (i.e. the waste package
    and the emplacement drift openings). Our thermal testing program is
    well underway.
      --The single heater test, which began in August 1996, was completed
            in fiscal year 1998. The final results from this test are
            generally consistent with model predictions of temperature,
            rock displacement, and moisture movement. Data were obtained on
            heat transfer, thermal conductivity, thermal expansion, thermal
            chemistry, air permeability, and hydrology of the heated rock.
            The test also allowed us to refine the design and
            instrumentation of the drift scale heater test.
      --The large-block heater test, which began in February 1997 in a
            fourteen foot high section of an outcrop at Fran Ridge, an area
            adjacent to Yucca Mountain in a portion of the potential
            repository host rock exposed at the surface, was completed in
            fiscal year 1998. The use of an isolated block allowed us to
            measure the moisture movement caused by heat in a controlled
            environment. Core samples obtained from the block are now being
            analyzed to look for changes in rock fractures due to heating.
      --The drift scale heater test is a long-term test to obtain data on
            the mechanical and thermohydrologic properties of a repository
            host rock. The test, which began in fiscal year 1998, nearly
            1000 feet below the surface of Yucca Mountain inside the
            Exploratory Studies Facility, is in the heat-up cycle. On
            December 3, 1997, a series of electric heaters were turned on,
            initiating the flow of heat into a section of the mountain.
            Designed to simulate the heat from actual waste packages, the
            drift scale test is the largest of the three heater tests at
            Yucca Mountain, and for that matter, is the largest underground
            thermal test ever conducted in the world. During fiscal year
            1998, we increased the temperature in the test drift from
            ambient 86 degrees Fahrenheit to 275 degrees Fahrenheit. The
            goal is to maintain the drift wall rock temperature at 392
            degrees Fahrenheit for two years before the cool down cycle
            begins. The total duration of this test will be eight years:
            four to heat-up and four to cool down.
        Testing in an underground facility at Busted Butte near Yucca
    Mountain began in fiscal year 1998 and is still ongoing. Test results
    in the Calico Hills rock unit will provide an analog to expected
    conditions in the same type of rock that lies below the potential
    repository horizon. Tests are being conducted to validate laboratory
    data and conceptual numerical transport models. These tests are
    intended to reduce uncertainties in assessments of the potential
    transport of key radionuclides from the repository area, through the
    unsaturated zone, and into the water table underlying Yucca Mountain.
    Tests also will address the importance of colloid-facilitated transport
    of radionuclides, especially plutonium. Observations at Busted Butte
    are important to understanding transport in the unsaturated zone,
    beneath the emplacement drifts, because additional sorption of
    radionuclides is expected even in a scenario dominated by fracture
    flow. Future work will quantify the fracture-matrix coupling that will
    be incorporated into the updated site-scale models to support the total
    system performance assessment for the Site Recommendation Report and
    the License Application.
        Under the agreement with Nye County, eight wells have been
    completed along Highway 95 south of Yucca Mountain. We have collected
    cutting samples and are reviewing the geologic logs. We are in the
    process of analyzing water samples from these wells. This data will be
    used in updating the geologic framework model.
        Thus far, our repository performance assessments have shown that
    the rate and amount of seepage of water into the emplacement drifts is
    very important to repository performance. Since the effects of tunnel
    ventilation may well mask the detection of any seepage, in 1998 we
    isolated individual niches in the Exploratory Studies Facility from
    ventilation to see whether any seepage can be detected. To date, no
    seepage has been observed in these test niches.
        One alcove in the Exploratory Studies Facility has been isolated
    from ventilation effects to monitor humidity and seepage during the
    higher rainfall caused by El Nino. This alcove is within the vicinity
    of the potential repository block area near to and within the Ghost
    Dance fault exposure. To date, no seepage has been observed.
        The focus at Yucca Mountain during fiscal year 1999 will be on
    issuing the Draft Environmental Impact Statement; completing the last
    phase of the peer review of the Total System Performance Assessment
    that supported the Viability Assessment; and updating repository and
    waste package designs to support updating the Total System Performance
    Assessment for the Site Recommendation Report. Those activities are
    also the Program's Government Performance and Results Act commitments.
        In fiscal year 1999, to date, we have made the following progress:
      --In support of the Environmental Impact Statement, we began the
            Department-wide review of the Draft Environmental Impact
            Statement. We are on schedule for meeting the July 1999 date
            for publishing the Draft Environmental Impact Statement and
            starting the public hearings.
      --Completed a topical report on the methods we plan to use to model
            and evaluate the potential for a nuclear criticality event
            (sustained chain reaction). The report was transmitted to the
            NRC in January 1999.
      --Completed License Application Design Selection workshops aimed at
            assuring validity and transparency of the process for selecting
            repository designs and options that will be modeled for the
            Site Recommendation Report and License Application.
      --Completed management plans to guide writing both the Site
            Recommendation Report and the License Application and began
            developing the first drafts of both these documents.
      --Completed phase one of the Busted Butte radionuclide transport
            test. The preliminary results provided significant information
            on flow partitioning between fracture and matrix of the rocks
            beneath the potential repository.
      --Continued National Environmental Policy Act consultation and
            coordination activities with numerous federal, state, and local
            agencies and Native American tribal organizations. Status
            briefings on the Environmental Impact Statement's development,
            as well as coordination of any Environmental Impact Statement
            data needs, were conducted with the U.S. Nuclear Regulatory
            Commission, Nuclear Waste Technical Review Board, U.S. Bureau
            of Land Management, U.S. Air Force, State of Nevada and
            affected counties, and Native American tribes.
                 waste acceptance, storage, and transportation
        The Department's acceptance of commercial spent nuclear fuel
    remains a critical objective of the Program and, in the Office of Waste
    Acceptance, Storage, and Transportation (OWAST) area, that is where we
    focused our efforts. However, in recognition of the hardships
    associated with the Department's delay in waste acceptance, we have
    offered to make equitable adjustments with the contract holders to
    address those issues.
        In fiscal year 1998, we developed a generic, non-site specific
    topical safety analysis report for a centralized interim storage
    facility. The report was submitted to the Nuclear Regulatory Commission
    and contained the required analyses and evaluations necessary to show
    that the operation of such a facility would meet the Commission's
    requirements for the protection of the environment, public safety, and
    health. We have continued interactions with the Commission and expect
    their approval this year.
        In fiscal year 1999, the Program utilized just under $2 million to
    conduct activities that are the responsibility of the Office of Waste
    Acceptance, Storage, and Transportation. Several of the sub-elements of
    the OWAST function were de-emphasized in fiscal year 1998 and fiscal
    year 1999 to apply resources to the Yucca Mountain Site
    Characterization activity rather than on transportation activities.
        We continued to refine a competitive procurement strategy for
    acquiring waste acceptance and transportation services utilizing
    private industry. We issued a revised draft Request for Proposals (RFP)
    in December 1997, that embodies a market-driven approach relying on the
    maximum use of private industry capabilities, expertise and experience
    to acquire contractor services to accept and transport commercial spent
    nuclear fuel to a Federal facility. In September 1998, the draft RFP
    was revised to address public/industry comments, and a Notice of
    Availability was published in the Federal Register. Work on the RFP was
    subsequently deferred until a repository siting decision process is
    completed. When that process is completed, activities related to the
    acquisition of waste acceptance and transportation services will be
    reinitiated.
                       program management and integration
        In fiscal year 1999, we continued to ensure that the integration
    requirements between the various components of the waste management
    system were adequately addressed and alternative system designs and
    proposals were evaluated with careful attention paid to their effects
    on system operations and costs. We completed a Total System Life Cycle
    Cost Report and a statutorily required Fee Adequacy Report. Those two
    documents accompanied the Viability Assessment at the time of its
    issuance.
        The Program also concluded and is implementing Memoranda of
    Agreement's with the Office of Environmental Management and the Naval
    Nuclear Propulsion Program that specify each Office's technical,
    programmatic, and financial responsibilities with respect to spent
    nuclear fuel and high-level radioactive waste.
        In an effort to utilize our resources more efficiently, we
    streamlined our operations. The program reduced headquarters staff in
    1998 through a significant reduction-in-force. With reductions-in-force
    and staff reassignments, the Program reduced Headquarters staffing by
    39 percent. Since fiscal year 1992, the Program has significantly
    shifted the balance of staffing from headquarters to Nevada, with a
    reduction at headquarters of 50 percent and an increase in Nevada of 40
    percent.
        In fiscal year 1999, responding to the Congressional direction
    regarding the use of its support service contractors, the Program
    reduced, by over 10 percent, funding for ``* * * management and
    administrative support service contractors at the Yucca Mountain Site
    Characterization Project Office and Headquarters.'' No reductions were
    made in other support service contracts that provide support for
    Nuclear Regulatory Commission-required quality assurance verification
    and support for preparation and publication of the required
    Environmental Impact Statement.
        The attachment to my statement provides a more detailed treatment
    regarding the objectives of work and progress made in fiscal year 1998
    and fiscal year 1999.
               application of the fiscal year 2000 budget request
                                    overview
        The President's fiscal year 2000 Budget Request for the Office of
    Civilian Radioactive Waste Management is consistent with the policy
    direction provided by Congress in the last several Energy and Water
    Development Appropriations Acts. The Program's Budget Request focuses
    principally on the activities being conducted by the Yucca Mountain
    Site Characterization Project. The Budget Request will fund activities
    necessary to complete the final years of the site characterization
    program, including:
      --Completion of the Final Environmental Impact Statement in 2000; and
      --The decision, by the Secretary, whether to recommend the site to
            the President in 2001 for development of a repository, if the
            site is found to be suitable.
        Should the President and Congress accept the site recommendation,
    the work to be completed in fiscal year 2000 is critical to the
    development and submission of a License Application for repository
    construction to the Nuclear Regulatory Commission in 2002.
                                 yucca mountain
        In fiscal year 2000, the funds that will be allocated to the Yucca
    Mountain Site Characterization Project will be used to move us beyond
    the Viability Assessment, specifically to:
      --Continue the necessary scientific and engineering work to complete
            the characterization of the Yucca Mountain site;
      --Address the remaining uncertainties about the site's ability to
            contain and isolate nuclear waste, including completion of some
            of the design analyses for the engineered barrier that will
            serve, in part, as the basis for the Site Recommendation Report
            and License Application (such as structural, shielding,
            thermal, criticality, cost, and design basis event aspects);
      --Further refine our repository and waste package designs to assist
            in the assessment of a repository safety strategy and total
            system performance, including updated reports on waste package
            materials and waste form characteristics;
      --Continue to strengthen our understanding of the expected
            performance of the proposed repository's natural and engineered
            barriers;
      --Evaluate total system performance using updated models to support
            development of the Site Recommendation Report and License
            Application;
      --Complete the public hearings on the draft Environmental Impact
            Statement and develop a Comment Response Document that will be
            included in the final Environmental Impact Statement;
      --Prepare, and issue, the final Environmental Impact Statement for a
            Geologic Repository for the Disposal of Spent Nuclear Fuel and
            High-level Radioactive Waste at Yucca Mountain; Nye, County
            Nevada. Incorporate public comments, as appropriate, on the
            draft Environmental Impact Statement; and
      --Continue efforts to support the preparation of a high quality,
            complete, and defensible Site Recommendation Report and, if the
            site recommendation is approved, a License Application.
        The plan for fiscal year 2000 and beyond reflects the transition of
    the project activities from scientific investigations to data
    synthesis, model validation, repository and waste package design, and
    safety analysis. Those activities are essential inputs to: (1) the
    decision by the Secretary whether to recommend the site to the
    President, if the site is found to be suitable; and (2) the submission
    of a License Application to the Nuclear Regulatory Commission, if the
    site is approved for repository development. Near-term priorities will
    be on enhanced characterization efforts to develop the remaining
    information required to support the Site Recommendation Report and the
    License Application. Specific activities for fiscal year 2000 will
    focus on:
        Core Science.--Core Science includes collection of site
    characterization and performance confirmation data from the surface and
    subsurface, and testing in the laboratory; environmental data
    collection, monitoring, and requirements compliance; site and materials
    performance testing; scientific test planning and design; formulation
    of scientific hypotheses; modeling and hypothesis testing; development
    of scientific information for technical data bases; and completion of
    models and synthesis reports that serve as the basis for scientific
    descriptions and analyses used in the documentation supporting
    remaining major program milestones, including the Site Recommendation
    Report and License Application.
        Our planned activities in the Core Science area are focused on data
    synthesis and documentation, model updating and validation and
    continuing performance confirmation efforts to advance our overall
    knowledge for the Site Recommendation Report and the License
    Application. Specific activities will focus on testing in the
    Exploratory Studies Facility, including the Cross-Drift and the drift
    scale test; confirmatory field-scale tests; modeling; environmental,
    safety and health compliance; and environmental monitoring and
    mitigation activities.
        Within the Exploratory Studies Facility, we will continue the long-
    term drift-scale thermal test that began in December 1997. This test
    will allow us to explore how the rock and fluids in a repository system
    will behave in the long-term presence of heat generated by radioactive
    decay of the emplaced waste. Testing in the Cross-Drift will continue
    to collect data on hydrologic properties of the repository horizon
    (i.e., fracture-matrix interaction, and fracture flow properties,
    particularly of the lower lythopysal unit where approximately 65
    percent of the emplacement drifts are expected to be located).
        We will refine the geologic process models that underlie the total
    system performance assessment models that will support both the Site
    Recommendation Report and License Application. Conceptual and numerical
    models of flow and transport, the near-field environment, and
    repository thermohydrology used in the Viability Assessment will be
    updated to reflect scientific data that have been collected since mid-
    1998. Saturated zone and unsaturated zone models for flow and
    radionuclide transport will be validated for use in the Site
    Recommendation Report and License Application. Confirmatory data
    collection and long-duration testing will continue.
        Confirmatory field-scale tests will continue to support refinement
    of near-field environment models. These models involve coupled thermal,
    chemical, mechanical, and hydrologic processes and describe how water
    could enter emplacement drifts, interact with waste packages, and
    transport radionuclides through the engineered barrier system. These
    tests support the evaluation of near-field process models that will
    directly support the total system performance assessment for the Site
    Recommendation Report by reducing and quantifying uncertainty in
    calculations of radionuclide releases from the engineered barrier
    system. These tests will also confirm predictions of coupled process
    behavior in the repository near-field associated with repository
    heating.
        We will continue to monitor transient seismicity and meteorological
    events and moisture movement in the Exploratory Studies Facility and we
    will conduct hydrographic monitoring in boreholes. Meteorological data
    for use in radiological dose assessments and biosphere modeling will be
    collected and airborne transport characteristics monitoring at Yucca
    Mountain will continue.
        The fiscal year 2000 budget includes $10 million for a cooperative
    agreement between the Department and the University and Community
    College System of Nevada (UCCSN). The agreement started in fiscal year
    1999 and will continue into fiscal year 2002. The principal purpose of
    the cooperative agreement is to develop and continue providing the
    public and the Yucca Mountain project with an independently derived
    body of scientific and engineering data concerning the study of Yucca
    Mountain as a potential high level waste repository in support of the
    Site Recommendation Report and License Application. Under this
    agreement, UCCSN will perform scientific or engineering research, and
    develop and foster collaborative working relationships between
    government and academic researchers.
        In fiscal year 2000, work will focus primarily on research and
    evaluation in the areas of seismology and hydrology and improvement of
    data retrieval systems to support Program goals. Geodetic measurements
    and studies with respect to the strain rate of the earth's crust in the
    Yucca Mountain region will be conducted to help determine the
    probability of the occurrence and magnitude of seismic events. The
    UCCSN will conduct studies related to fluid inclusions with respect to
    potential rising of hydrothermal fluids at Yucca Mountain. Under this
    task, UCCSN will collect and analyze data and share the results with
    federal and State of Nevada scientists. Continuing work on improving
    data retrieval systems will explore and enhance record indexing
    techniques to provide a better method of tracking and retrieving data
    in the records management system in support of the licensing support
    system. In addition many smaller tasks will be conducted by UCCSN such
    as saturated zone data analysis, long term performance confirmation
    monitoring, microbiologically influenced corrosion research and
    hydrogen embrittlement testing.
        Nye County is drilling a network of boreholes to be used to monitor
    the movement of groundwater south of the proposed repository, off the
    Nevada Test Site. The county's researchers are establishing the
    conditions that exist before repository construction and will use the
    network as an Early Warning Monitoring System. We are coordinating with
    Nye County to obtain water measurements and water and rock samples from
    their drilling program. Cooperative planning has produced a program of
    scientific activities that complement the Nye County objectives. We
    will conduct chemistry and isotopic analysis of the water; and
    paleohydrologic, Eh/redox potential, rare earth and trace element
    analysis; and geophysical log interpretations.
        Environmental monitoring and compliance activities will continue.
    These activities include monitoring air quality and meteorology, water
    resources studies, archeological and radiological studies, and
    monitoring of ecosystem and socioeconomic indicators. We will maintain
    and acquire requisite permits so that uninterrupted site activities may
    continue, and we will conduct surveillances, audits and assessments of
    site activities to ensure regulatory compliance. Many of these
    activities are regulated by statutes and regulations such as the
    Endangered Species Act, Comprehensive Environmental response,
    Compensation, and Liability Act, and the Clean Water Act.
        Design and Engineering.--The Design and Engineering includes three
    major areas--Waste Package Development, Repository Design, and Systems
    Engineering. Waste Package Development includes two very distinct areas
    of engineering activity--waste package design and waste forms and waste
    package materials testing. Repository design also includes two distinct
    areas--subsurface facilities design and surface facilities design.
    Systems Engineering integrates all aspects of design and ensures that
    the Monitored Geologic Repository can be constructed as designed, and
    will perform safely and efficiently.
        The fiscal year 2000 performance measure, associated with the
    Government Performance and Results Act, involves deciding on the
    reference design that will be presented in the Site Recommendation
    Report and License Application. The License Application Design
    Selection evaluation now underway, will result in technical
    recommendations for repository/waste package designs and options. The
    design will, most likely, result in additional features that will
    require detailed design analyses prior to the design selection in
    fiscal year 2000.
        The reference design for the Site Recommendation Report and License
    Application will be documented. Design documentation will include
    safety and accident analyses and will describe the design in sufficient
    detail to show that a repository can be operated safely during waste
    emplacement at Yucca Mountain and after all waste packages have been
    emplaced (i.e., preclosure period).
        Important areas of ongoing design emphasis include: waste package
    materials; waste form testing and analyses; waste handling system and
    emplacement operations; (i.e., repository concept of operations); a
    demonstration of design compliance with codes, standards, and
    regulatory requirements (i.e., design verification); assurance that the
    technical work being performed within the individual engineering
    specialties is integrated (i.e., interface control); and detailed
    engineering for these elements of a repository system that show no
    similarities to systems licensed previously in commercial nuclear power
    plants.
        Nuclear waste forms that will be placed in a repository include
    spent nuclear fuel from commercial nuclear power plants, spent nuclear
    fuel and high-level waste from the Department of Energy, Naval nuclear
    spent fuel, and immobilized plutonium. A repository will be designed to
    accommodate the varied size, weight, radioactivity, and heat
    characteristics of these materials in the repository. Development of
    repository acceptance criteria (e.g., disposal interface
    specifications) for noncommercial spent fuel will continue.
        Licensing/Suitability/Performance Assessment.--The primary focus in
    fiscal year 2000 is to compile the technical documentation that will
    comprise the Site Recommendation Report. A draft Site Recommendation
    Report will be developed and will be available at the hearings planned
    for early fiscal year 2001 to notify the public that the Secretary of
    Energy is considering whether to recommend the site to the President.
    The final Site Recommendation Report, together with the final
    Environmental Impact Statement, and other information required by the
    Nuclear Waste Policy Act of 1982, as amended, including the views of
    the Nuclear Regulatory Commission, and the State of Nevada, will be
    considered by the Secretary of Energy in deciding, in early fiscal year
    2002, whether to recommend the site to the President.
        Development of the License Application for repository construction,
    which would be submitted to the Nuclear Regulatory Commission by the
    Secretary of Energy, will continue. Before the License Application
    would be submitted, we would continue to work with the Nuclear
    Regulatory Commission to resolve procedural and technical issues.
    Interactions with the Nuclear Waste Technical Review Board, and other
    external organizations will continue.
        The focus of performance assessment activities will be to update
    the total system performance assessment models used in the Viability
    Assessment, and use them to support development of the Site
    Recommendation Report and License Application. The total system
    performance assessment models will be refined based on site
    characterization information, design information, and feedback from
    external organizations (e.g., Nuclear Waste Technical Review Board,
    Nuclear Regulatory Commission, Performance Assessment Peer Review
    Panel) acquired during fiscal year 1998 and 1999.
        All technical data used for a repository and waste package design,
    total system performance assessment, and models for site processes and
    conditions must be traceable and electronically retrievable in
    accordance with 10 CFR Part 2, Subpart J. The latest web-based
    technologies will continue to be utilized to ensure that program data
    and records are quickly and easily retrievable at the time that the
    Secretary of Energy may decide to recommend the site to the President.
        NEPA.--The primary focus will be on National Environmental Policy
    Act compliance. Activities include completing the public hearings on
    the draft Environmental Impact Statement, which will be held
    nationally, completing the final Environmental Impact Statement,
    including the Comment Response Document, and issuing it in August 2000.
        Operations/Construction.--To support collection of scientific data,
    we will construct one large test area (alcove) and one smaller test
    area (niche) in the Cross-Drift tunnel. We will continue to provide
    support services necessary for continued testing in the Exploratory
    Studies Facility, the Cross-Drift, and the Busted Butte Test Facility.
    These services include providing test set-up, training, and test
    facility modification; maintaining and upgrading the ventilation,
    electric, and other utility systems; aligning the underground rail
    system; providing site and underground security; and providing other
    services designed to protect worker health and safety and protect the
    environment. We also will support surface based testing by providing
    any necessary drilling/coring and well work-over. We will continue to
    maintain underground and surface test facilities, vehicles, and
    equipment consistent with programmatic and asset management
    requirements.
        External Oversight and Payments Equal to Taxes (PETT).--We will
    continue to support external oversight activities and payments equal to
    taxes. External oversight activities consist of financial and technical
    assistance to the State of Nevada and affected units of local
    government (i.e., Churchill, Clark, Esmeralda, Eureka, Lander, Lincoln,
    Mineral, Nye, and White Pine Counties in Nevada and Inyo County in
    California). Payments-Equal-to-Taxes are made to the State of Nevada
    and Nye, Clark, and Inyo Counties. Payments-Equal-to-Taxes will
    increase in fiscal year 2000 due to the increased value of facilities
    at the Yucca Mountain site.
        Yucca Mountain Project Management.--We will continue to enhance our
    critical project management and project control activities, including
    planning, budgeting, and scheduling. This will include activities to
    ensure that staff are qualified to perform their approved activities,
    and trained to perform them safely, and that performing organizations
    are provided with the facilities, equipment, information systems, and
    support services needed to perform their approved activities.
        Project management also includes conducting public information and
    outreach programs to ensure open and informative interactions with the
    public, technical review organizations, and other program managers. We
    will maintain records and ensure technical information is broadly
    disseminated to these groups.
        International Conference.--In September 1998, Secretary Richardson
    announced at the International Atomic Energy Agency's General
    Conference that, in 1999, DOE would host a conference on global efforts
    to dispose of nuclear materials in geological repositories. The ``DOE
    International Conference on Geologic Repositories'' will be held
    October 31-November 3, 1999. The purpose is to share results of our
    experience and progress and welcome the input of others. Tours of the
    Yucca Mountain site and the Waste Isolation Pilot Plant (WIPP) in New
    Mexico will be on October 31 and November 3, with the conference taking
    place on November 1 and 2, 1999.
                 waste acceptance, storage, and transportation
        In fiscal year 2000, the budget request for the Waste Acceptance,
    Storage, and Transportation program area is $6 million. The request
    will support the following set of functions:
      --Interactions with standard contract holders to discuss how best to
            accommodate the delay in the acceptance of spent fuel from
            commercial utilities;
      --Activities related to generic and non-site specific long-lead time
            activities that must precede the removal of spent nuclear fuel
            from reactor sites once a federal facility becomes available;
      --Interactions with potentially affected parties to plan for the
            provision of technical and financial assistance, as required by
            Section 180(c) of the NWPA, as amended, to States and Indian
            Tribes for emergency response training for public safety
            officials through whose jurisdiction shipments of spent nuclear
            fuel and high-level radioactive waste will be transported; and
      --Preparation of acquisition documents and technical specifications
            to facilitate issuance of an RFP for acquisition of waste
            acceptance and transportation services from private industry.
                       program management and integration
        The $71 million that we request will support Nuclear Quality
    Assurance, Regulatory Compliance, Program Control, and Management
    activities.
      --$17 million for Regulatory Compliance related activities that
            include Nuclear Quality Assurance/Quality Control, the Yucca
            Mountain Environmental Impact Statement, and independent
            technical validation and verification;
      --$18 million for Program Control that includes planning, program
            management and control functions, Total System Life Cycle Cost
            Report and Fee Adequacy Report preparation, systems engineering
            and integration; and
      --$36 million for Management functions that include federal salaries,
            information technology applications, audits, records
            management, and public information.
        As noted, the budget request of $71 million supports the
    fundamental base program, which support crosscutting programmatic
    activities such as strategic and contingency planning; program
    monitoring and control; quality assurance; technical oversight, systems
    integration; regulatory compliance and integration; human resources and
    administration; information resource management; and federal salaries.
        Nuclear Quality Assurance.--Our Nuclear Quality Assurance
    activities ensure the adequate and appropriate implementation of
    federally-mandated Nuclear Quality Assurance requirements related to
    radiological health and safety and waste isolation. In fiscal year
    2000, we will conduct audits and surveillances on activities performed
    by the Yucca Mountain Site Characterization Project and the Waste
    Acceptance, Storage, and Transportation Program; provide support for
    the disposition of the Department's nuclear materials (including naval
    nuclear spent fuel); and continue to document our compliance with
    quality assurance requirements. These activities will support the
    development and eventual licensing of nuclear waste storage and
    disposal facilities.
        Regulatory Compliance.--The Program's Regulatory Compliance
    activities focus on ensuring that the activities leading to the
    implementation of the waste management system are consistent with the
    regulatory guidance and provisions of the Program's governing
    authorities. In fiscal year 2000, we will continue to interact on a
    proactive basis with the Nuclear Regulatory Commission and the Nuclear
    Waste Technical Review Board to address key technical issues. We will
    continue to transition our focus from the issue of how individual
    features of the site perform in isolation, toward the goal of achieving
    a common understanding of the issues important to overall repository
    performance and the adequacy of proposed methodologies and approaches
    to resolution of important technical issues.
        These activities are critical to the success of the overall program
    as they directly affect the Commission's licensing process. We intend
    to continue our dialogue with the Commission on these issues. Following
    the issuance of the Viability Assessment, we will continue to engage in
    more frequent interactions to address key technical issues.
        Program Control/Systems Engineering.--The overall objective of our
    systems integration effort is to ensure that the various components of
    the federal waste management system (such as transportation services
    and procurement activities, and repository and waste package design
    activities) are integrated into a single system that is safe,
    efficient, reliable, and cost-effective. In fiscal year 2000 we will
    ensure that those integration requirements between the various
    components of the waste management system will be adequately addressed
    and, if necessary, alternative system designs and proposals will be
    evaluated with careful attention paid to their effects on system
    operations and costs. We have just completed a Total System Life Cycle
    Cost Report and Fee Adequacy Report and we will work within the
    Department to address a wide range of issues associated with the
    acceptance of Department-owned spent nuclear fuel, high-level
    radioactive waste, and Naval nuclear spent fuel.
        Program Management.--The program is continuing to implement the
    Civilian Radioactive Waste Management Strategic System Management
    Policy. The policy clarifies accountability, responsibility, and
    authority. It codifies management policies and requirements. Further,
    it provides for a performance-based approach that promotes
    accountability across federal and contractor organizations. The
    implementation will focus management attention on the identification
    and consolidation of overlapping, duplicative, and redundant management
    system requirements, processes, and practices necessary to manage the
    program.
        We will continue to use our information management technology to
    improve the productivity of the Program's human resources, drive
    process improvements, and reduce overall program costs. We are also
    responding to increased demand from Program stakeholders and the public
    for easy and timely access to a wide range of information about the
    Program. As an example, we made available, through our Internet Home
    Page, the Viability Assessment, its companion documents, and all
    relevant technical studies/analyses supporting the Viability
    Assessment. Interest in these documents has been high. We have received
    comments or requests for additional information related to the
    Viability Assessment via e-mail from as far away as Australia, Germany,
    and the Philippines. Internet access will also be provided to program
    documents supporting the Site Recommendation and License Application.
    We expect even greater demands for information systems, support, and
    services as we move to licensing.
                               concluding remarks
        As I noted in my opening remarks, we have made substantial progress
    in the last year and we are appropriately positioned to continue. The
    Viability Assessment, as you know, found that there were no ``show
    stoppers'' with respect to the site at Yucca Mountain. It laid out the
    path forward for the Program. It identified the necessary remaining
    scientific and technical work we have to complete and it laid out the
    funding profile we require.
        We are almost at the end of site characterization. Funding at our
    request level will give us the resources required to address the last
    remaining questions about the suitability of Yucca Mountain on the
    schedule we have laid out. If the site if found suitable, the Secretary
    will be in a position then to make a decision about recommending the
    site to the President for development as the Nation's repository for
    spent nuclear fuel and high-level radioactive waste.
        I urge your favorable consideration of our appropriation request.
        Thank you. I would be pleased to answer any questions you may have.

        Fiscal Year 1998-Fiscal Year 1999 Major Program Accomplishments

                                 yucca mountain
        During the past year, the Program focused its efforts on the
    transition from conducting scientific investigations to data synthesis,
    model validation, repository and waste package design, and safety
    analysis necessary to develop the Site Recommendation Report, and
    License Application. Specifically, we focused on: (1) completing the
    Viability Assessment and; (2) completing design and scientific and
    performance assessment models to support development of the draft
    Environmental Impact Statement.
        During the balance of fiscal year 1999, we will see the completion
    of several activities and continuation of longer-term efforts. Our
    major emphasis will continue to be on implementing the Viability
    Assessment Volume 4, License Application Plan and Costs to guide
    technical work that will address the remaining uncertainties in support
    of a site suitability determination, Site Recommendation Report and
    License Application.
        Emphasis will be on completing those activities and analyses that
    contribute to developing the Site Recommendation Report and drafting
    the License Application. These activities and analyses are grouped into
    the broad categories of Core Science, Design and Engineering,
    Suitability/Licensing, Performance Assessment, NEPA, Operations and
    Construction, and the supporting category of Project Management. Each
    of these categories plays an important role in assembling a
    comprehensive picture of the viability of a repository at the Yucca
    Mountain site.
        The Viability Assessment.--The Viability Assessment, completed on
    schedule in fiscal year 1998, was submitted to the President and
    Congress on December 18, 1998. Even before it was released, it was used
    as a management tool to focus future work needed to support the
    decision on a site recommendation.
        Core Science.--The majority of the surface-based testing needed for
    licensing has been completed. With completion of the Cross-Drift in the
    Exploratory Studies Facility, the focus of underground work will shift
    to investigations of the Solitario Canyon fault and to hydrologic and
    thermal studies of the upper and lower portions of the repository rock
    unit. Testing in the cross drift will provide additional insight into
    fracture patterns, potential faults, distinct rock layers, and
    hydrologic characteristics of the repository, and the Solitario Canyon
    fault. This testing will further reduce uncertainties about the site
    and help us better understand processes that are critical to site
    suitability and repository construction.
        Two additional boreholes (SD-6 and WT-24), to the west and north,
    respectively, of the proposed repository block are providing
    information on rock properties, deep stratigraphy, and the saturated
    zone to support three-dimensional geologic and hydrologic modeling
    efforts.
        Three tests using electric heaters to simulate heat generated by
    radioactive decay of the emplaced waste were designed to yield
    important information on how heat affects rock chemistry, rock
    mechanics, and site hydrology--and thus repository performance. The
    first study, a large-scale underground test, used a single heater to
    heat a 25-cubic-meter volume of rock to 212 degrees Fahrenheit (100
    degrees Celsius). The second study involved heating a large, discrete,
    aboveground block of rock that permitted us to more closely control and
    monitor test parameters. The third study approximates an actual waste
    emplacement drift--an underground alcove about 50 meters long--will be
    heated over several years 392 degrees Fahrenheit (200 degrees Celsius).
        In mid-fiscal year 1998, a controlled experiment was initiated to
    determine the infiltration rate and travel time through the Tiva Canyon
    welded tuff. The test involved a surface infiltration network and a
    collection system located in Exploratory Studies Facility Alcove 1
    directly below the surface infiltration plot. Monitoring of this
    experiment is planned to determine the relationship between
    infiltration and drift seepage.
        The drift seepage testing program was expanded during fiscal year
    1998 and 1999. Pre- and post-excavation air permeability tests were
    completed at two niches in the Exploratory Studies Facility.
    Concurrently, 40 liquid-release tests were performed in 16 test
    intervals to determine the drift seepage threshold flux, which is
    defined as the liquid-release rate at or below the level where water
    will no longer seep into the drift. These experiments directly feed the
    unsaturated zone, drift seepage, and near field models, and are a
    critical input to performance assessment simulations.
        Matrix and fault flow tests are underway in the Paintbrush Tuff
    exposed in Exploratory Studies Facility Alcove 4 to determine how the
    presence of a structural break, such as a fault, affects the movement
    of water in this medium. Similarly, pneumatic and liquid-release
    testing of the densely welded repository unit has been conducted in
    support of the Alcove 6 fracture-matrix interaction experiment. Results
    from these two experiments will be incorporated into the unsaturated
    zone process model and used in the performance assessment.
        Hydraulic and transport testing using conservative and reactive
    tracers has been completed in the Prow Pass hydrogeologic unit at the
    C-Hole complex. Test results from this low-flow zone near the water
    table are important because any radionuclides released from a breached
    waste package would first encounter this hydrogeologic unit.
        Sample collection and analysis of the oxidation-reduction potential
    of saturated zone were performed for boreholes WT-17 and WT-3 south and
    east of Yucca Mountain. Measurement of this parameter is important to
    performance assessment because reducing conditions in the saturated
    zone can render radionuclides immobile due to strong sorption
    potential.
        During the remainder of fiscal year 1999, we will continue
    documenting our present understanding of the geologic conditions and
    processes at Yucca Mountain, and completing models of geologic and
    hydrologic processes in the saturated and unsaturated zones, sufficient
    to support the Site Recommendation Report and working draft License
    Application. We will continue with the four-year heat-up phase of the
    drift-scale heater test. We will continue to collect meteorological,
    and other environmental data to support the Environmental Impact
    Statement, Site Recommendation Report, and the License Application.
        Nye County is drilling a network of boreholes to be used to monitor
    the movement of groundwater south of the proposed repository, off the
    Nevada Test Site. They are establishing the conditions that exist
    before repository construction and will use the network as an Early
    Warning Monitoring System. We are coordinating with Nye County to
    obtain water measurements and water and rock samples from their
    drilling program. Cooperative planning has produced a program of
    scientific activities that complement the Nye County objectives. We
    will conduct chemistry and isotopic analysis of the water; and
    paleohydrologic, Eh and redox potential, rare earth and trace element
    analysis; and geophysical log interpretations.
        We implemented a cooperative agreement with the University and
    Community College System of Nevada to perform scientific and
    engineering research, and develop and foster collaborative working
    relationships between the government and academic researchers.
        Design and Engineering.--We continued to develop and refine
    repository design requirements. To this end, several analyses to
    substantiate or resolve assumptions related to requirements and
    criteria were completed or revised.
        A study of design features and design alternatives that will be a
    basis for selecting the License Application reference design will be
    completed. Features are design enhancements that can be easily
    incorporated within multiple alternative designs. Alternatives involve
    significant changes to the fundamental design concepts on which the
    Viability Assessment was based. Each has the potential for improving
    repository performance, simplifying the safety strategy, or both.
        The waste package nondestructive examination and weld development
    program proceeded with demonstrations of remote welding and successful
    nondestructive examinations. A full-diameter mockup of the waste
    package made from alloy C-22 and carbon steel (VA Design) was achieved
    by shrink-fitting the carbonated barrier around the alloy C-22.
    Ultrasonic inspection revealed 100 percent contact between the two
    surfaces.
        Corrosion testing of candidate waste package materials continued.
    Additional specimens were acquired and installed for exposure in the
    large chambers maintained under controlled temperatures and humidity
    levels. The Project initiated an experimental study for measuring the
    composition of the ionic salts as they concentrate on heated metal
    surfaces. Testing started on alloy C-22 and titanium specimens under
    controlled slow-strain rates. Revision 1, Version 1.3, of the Waste
    Form Characteristics Report was completed. This report describes
    preliminary degradation process models for use in the site
    recommendation and license application performance assessments. The
    update for the Engineered Materials Characterization Report was also
    completed. This report documents all of the test results and
    performance models generated in the past two years.
        For the remainder of fiscal year 1999, design and engineering
    activities will include the coordination and planning of waste package
    and repository surface and subsurface designs; the design and
    acquisition of services and equipment for the Cross-Drift in the
    Exploratory Studies Facility; preparation and maintenance of design
    requirements and design control documents; performance testing; and
    development of modeling programs for waste forms and waste packages.
        Suitability/Licensing.--Our investigations of the Yucca Mountain
    Site have resulted in a substantial understanding of the site, a
    preliminary reference repository design, and assessments of the
    performance of a repository system. However, additional work is needed
    to complete the postclosure safety case, support the preclosure safety
    case and support remaining design decisions. The primary focus in
    fiscal year 1999 and fiscal year 2000 is to compile the technical
    documentation that will support the Site Recommendation Report.
        We significantly refined our analysis for a repository safety
    strategy. The strategy relies on engineered barriers, geologic
    features, and natural processes to retard movement and prevent releases
    of radionuclides to the natural environment and to reduce exposure to
    the public.
        We completed management plans for both the Site Recommendation
    Report and License Application. Our focus for the remainder of fiscal
    year 1999 will be to complete development of the working draft License
    Application and start a comprehensive review of the draft. We will also
    develop a draft of the Site Recommendation Report that will be
    available for public review at the consideration hearings. Those
    hearings are planned for early fiscal year 2001.
        Interactions with the Nuclear Regulatory Commission staff will
    continue to focus on two objectives. The first is to reach a common
    understanding regarding the issues that are significant to overall
    repository performance. The second objective is to reach agreement on
    the adequacy of proposed methodologies and approaches to address
    important technical issues, such as criticality control and seismic
    design. The goal is to reach a mutual understanding of a repository
    concept as it develops. This understanding will provide bases for
    Nuclear Regulatory Commission preliminary comments on the sufficiency
    of site characterization and design information for inclusion in a
    License Application.
        Performance Assessment.--During fiscal year 1998, we completed
    development of the Total System Performance Assessment for the
    Viability Assessment's (TSPA-VA) supporting technical volume ``Total
    System Performance Assessment-Viability Assessment Analysis Technical
    Basis Document.'' Site characterization data, design information,
    process level modeling results, and opinions elicited from various
    experts provided the basis for abstracted component models used in
    TSPA-VA. The second and third interim reports from the Performance
    Assessment Peer Review Panel were issued in fiscal year 1999.
    Recommendations from this panel and those from external organizations
    (e.g., the Nuclear Waste Technical Review Board and the Nuclear
    Regulatory Commission) were factored into the development of the TSPA-
    VA model.
        The TSPA-VA model is being used in fiscal year 1999 as one of the
    tools to evaluate various design alternatives and options currently
    under consideration. The TSPA-VA model is also being used during the
    remainder of fiscal year 1999 to support development of the draft
    Environmental Impact Statement. Concurrent with this, activities are
    underway to begin refining the abstracted total system performance
    assessment component models that will be used to support the final
    Environmental Impact Statement, Site Recommendation Report, and License
    Application. We have begun to hold a series of workshops where open
    issues are identified, discussed, and prioritized. Specific work
    activities will be defined based on the outcome of these workshops to
    ensure that the issues are addressed in future performance assessment
    analyses.
        Following completion of these workshops, refinement of the total
    system performance assessment abstracted models will commence. The
    Performance Assessment Peer Review Panel issued its final report in
    February of 1999. Their recommendations and those of the Nuclear
    Regulatory Commission, Nuclear Waste Technical Review Board, and other
    external groups will be used in the development of refined total system
    performance assessment models. The methodology and assumptions that
    will be used in future total system performance assessment iterations
    will be documented in a report to be issued in July 1999.
        NEPA.--In fiscal year 1998, in compliance with the National
    Environmental Policy Act, we began to prepare the draft Environmental
    Impact Statement. A management council, which includes representatives
    of the Office of Environmental Management, the Office of Environment,
    Safety and Health, and the Office of General Counsel, is helping us
    provide guidance for developing the draft Environmental Impact
    Statement ensuring coordination within the Department of Energy. A
    preliminary draft Environmental Impact Statement is undergoing
    Departmental review.
        In fiscal year 1999, we will complete and issue the draft
    Environmental Impact Statement and hold hearings across the nation to
    receive public comments.
        Operations and Construction.--In fiscal year 1998, the Busted Butte
    test facility construction was completed. This facility will enable
    scientists to conduct field-scale observations of the Calico Hills
    formation. This is the same rock stratum that is located below the
    repository.
        Also, in early fiscal year 1999, we completed the excavation of the
    Cross-Drift in the Exploratory Studies Facility. This drift will give
    us access to more of the area near the location where waste might be
    emplaced.
        In fiscal year 1999, we will continue to support the operation and
    maintenance of the Exploratory Studies Facility, including test set up
    and training, alcove modification, maintenance and upgrades to
    ventilation, electric, and other utility systems, security, and the
    protection of health, safety, and the environment. We recently
    completed transition to the Integrated Safety Management System. The
    Exploratory Studies Facility continues to be monitored for occupational
    health compliance with ventilation and air quality requirements for
    dust abatement and silica exposure mitigation.
                 waste acceptance, storage, and transportation
        In the Waste Acceptance area, we performed fee verification for
    commercial spent nuclear fuel; interacted with other Departmental
    offices, the Nuclear Regulatory Commission, utilities, and others
    concerning nuclear materials safeguards.
        A non-site specific centralized interim storage facility Topical
    Safety Analysis Report was completed and submitted to the Nuclear
    Regulatory Commission in fiscal year 1998. That report is currently
    under staff review. We have continued interactions with the Commission
    staff during the review process. A cold demonstration program of a
    prototype spent fuel dry transfer system was initiated in June 1998.
    This demonstration program is sponsored jointly by the Office of
    Civilian Radioactive Waste Management and the Office of Environmental
    Management with industry participation. This system can be used by
    nuclear utilities with reactors that have limited crane capacities and
    are incapable of handling large storage casks. And, we continue to
    maintain and update our data base on industry development of storage
    and transportation technologies. We continued interaction with the
    Nuclear Regulatory Commission regarding review of the dry transfer
    system topical safety analysis report that had been submitted
    previously for Commission consideration.
        The Program issued a revised draft RFP to obtain additional
    comments on the planned acquisition of waste acceptance and
    transportation services, including canisters, transport casks, and
    storage modules. The RFP, to address the public/industry comments, was
    updated and a notice of availability was published in the Federal
    Register in September 1998.
        In recognition of our obligations under Section 180(c) of the
    Nuclear Waste Policy Act of 1982, as amended, which provides for
    financial and technical assistance to States and Indian Tribes through
    whose jurisdictions the Department plans to ship spent nuclear fuel,
    the Program issued, in April 1998, a Notice of Revised Proposed Policy
    and Procedures in the Federal Register. The Notice reflected our
    consideration of input from the States, local public safety officials
    and other interested parties on the proposed implementation procedures.
    In fiscal year 1998, we also continued to provide funds through
    cooperative agreements to national and regional groups to address
    transportation related issues.
                       program management and integration
        Over the past year the Program Management and Integration area
    continued to support the activities of the two Business Centers--the
    Yucca Mountain Site Characterization Office and the Office of Waste
    Acceptance, Storage, and Transportation.
        Nuclear Quality Assurance.--The Office of Quality Assurance
    completed the transition and consolidation of the Program's quality
    assurance activities in fiscal year 1998. This resulted in more
    effective execution of quality assurance activities and provided cost
    reductions in implementation. The Office of Quality Assurance supported
    the development of the Viability Assessment in fiscal year 1998, and is
    providing assistance to Site Recommendation Report activities in fiscal
    year 1999. The Office of Quality Assurance is continuing to support the
    Civilian Radioactive Waste Management System Management and Operating
    contractor staff in fiscal year 1999 in the Process Validation and Re-
    engineering efforts, which will result in procedural enhancements and
    consolidation. The Office of Quality Assurance continues to provide
    quality assurance guidance for the Yucca Mountain Site Characterization
    Project and the Office of Waste Acceptance, Storage and Transportation.
        Program Control/Systems Engineering.--We provided program- and
    project-level systems engineering and integration support for the
    ongoing Yucca Mountain site characterization, waste package, and
    repository design activities and the waste acceptance, storage, and
    transportation efforts. We implemented the Interface Management Process
    to allow the Yucca Mountain Site Characterization Office and the Office
    of Waste Acceptance, Storage and Transportation and their design and
    procurement contractors to effectively control system-level design
    interfaces. We worked extensively with Departmental elements
    responsible for the government's spent fuel and high-level radioactive
    waste to develop waste acceptance criteria that are compatible with the
    radioactive waste management system design requirements. We defined
    roles and responsibilities concerning the acceptance of Department-
    owned spent nuclear fuel and high-level radioactive waste and we
    completed Memoranda of Agreements with Office of Environmental
    Management and the Naval Nuclear Propulsion Program. We incorporated
    immobilized plutonium waste forms into the technical baseline.
        We coordinated and integrated the Program's activities with other
    Departmental elements regarding the Department's spent nuclear fuel and
    high-level radioactive waste. We continued to develop and implement an
    integrated schedule for the Monitored Geologic Repository system, the
    Office of Environmental Management, and the Office of Fissile Materials
    Disposition.
        We continued to conduct systems engineering studies and analyses
    and completed a number of studies, including the effects of early
    receipt of spent nuclear fuel on the program; impacts of early reactor
    shutdown, options for the disposal of site-generated wastes; dual
    purpose canister disposability benefit analyses; and the impacts of all
    legal-weight truck transportation. We completed work on analyses for
    the Total System Life Cycle Cost Report as well as the Fee Adequacy
    Report. Those reports were issued as companion documents to the
    Viability Assessment. We completed Revision 1 of the Civilian
    Radioactive Waste Management Total System Description of the waste
    management system as currently envisioned. We have also been actively
    working on developing a cooperative agreement with the Russian
    Federation to work together on geologic repository issues.
        Regulatory Compliance.--We continued to interact regularly with the
    Nuclear Regulatory Commission staff and Commissioners to address
    management and technical issues (e.g., quality assurance, total system
    performance assessment, repository and waste package design) and
    participated in numerous Nuclear Waste Technical Review Board and panel
    meetings. We renegotiated the prelicensing agreement that provides
    guidelines for communications between the staffs and management
    organizations of the Department and the Nuclear Regulatory Commission.
    We supported interagency discussions on the development of the
    Environmental Protection Agency radiation protection standard for Yucca
    Mountain. In addition, we coordinated and integrated program-related
    National Environmental Policy Act, environmental, safety, and health
    activities to ensure compliance with Federal and State requirements and
    Departmental directives.
        Program Management.--We issued Revision 2 of the OCRWM Program Plan
    in July 1998. Revision 2 essentially continues the thrust of the draft
    1996 revised plan, and identifies strategic objectives for fiscal year
    1998--fiscal year 2003, states the assumptions that the plan rests on,
    defines measures of success, and provides for contingency planning. It
    is intended to serve not only as the foundation of program management,
    but as a common framework that all parties can use to evaluate our
    progress and shape their own participation in the Program.
        We continued the development and implementation of a program wide
    information architecture to provide the foundation for the definition,
    development, organization, and management of, and access to, all
    program data, records, and information systems. Regarding our external
    communications, we continued to use our World Wide Web presence to
    distribute a variety of program information to interested stakeholders.
    Our address is http://www.rw.doe.gov/
        Many of the Program's policy and technical documents, including the
    Viability Assessment and all of its relevant companion and supporting
    documents, are available to the public through our electronic
    databases.
        During fiscal year 1998, we continued our Y2K compliance efforts by
    initiating the assessment and testing of all software applications. We
    validated for Y2K compliance and implemented all mission-critical
    systems ahead of the Department's stretch goal of January 31,1999.
    Assessment of non-mission critical systems is in progress, and we
    expect to validate and implement all non-mission critical systems later
    in fiscal year 1999.

                         yucca mountain water migration

        Senator Domenici. Senator Reid, do you have any questions?
        Senator Reid. Yes, Mr. Chairman.
        Mr. Barrett, I have some questions, but because of the
    press of the time of the committee and my time, if you would
    just respond yes or no, that would be appreciated.
        I understand that water poses a risk to long-term
    containment of spent nuclear fuel and other high-level
    radioactive waste. Do you agree?
        Mr. Barrett. Yes.
        Senator Reid. I also understand that early on in the Yucca
    Mountain project it was thought that it would take more than
    1,000 years for surface water to penetrate to repository
    depths, is that right?
        Mr. Barrett. Some theories say that.
        Senator Reid. If no, then how long would those that
    disagree say it would take?
        Mr. Barrett. It is a physical distribution of how the water
    moves, so it is a complex issue. Some of the water can move
    very fast, but the majority of the water moves very slowly.
        Senator Reid. Okay. Do you agree that scientific evidence
    now exists that proves that surface water penetrated to
    repository depths in about 40 years?
        Mr. Barrett. We have indication that some water has.
        Senator Reid. Please, yes or no.
        Mr. Barrett. Yes.
        Senator Reid. Mr. Barrett, I understand that the water
    moves so rapidly to the repository depths, because of what is
    called high-speed pathways, is that correct?
        Mr. Barrett. I have never heard the words high-speed
    pathways.

                                 rock fractures

        Senator Reid. Okay. Would you say they are just cracks in
    the rocks then?
        Mr. Barrett. There are natural fractures in all rock,
    including Yucca Mountain, and there are analyses that say water
    has been present in some of those fractures in the last 50
    years.
        Senator Reid. The question is: Why is the rock cracked, and
    what are possible things that could generate cracks in massive
    rock formations?
        Here is the question: Earthquakes are thought to generate
    massive deep fissures in the ground, and I suppose then that it
    is possible that earthquakes could generate cracks in the rock
    around Yucca Mountain. Would you agree to this supposition?
        Mr. Barrett. Most of the cracks----
        Senator Reid. Can you answer that yes or no?
        Mr. Barrett. I cannot, sir.
        Senator Reid. Okay. You cannot. Then you would disagree
    with my supposition that earthquakes generate cracks in rocks
    around Yucca Mountain.
        Mr. Barrett. No, I do not disagree with that.
        Senator Reid. Okay. You are aware that there is evidence
    that the earth around Yucca Mountain is stretching and that the
    program there is funding further study of this area, is that
    true?
        Mr. Barrett. That is true.
        Senator Reid. Could stretching like this also generate
    cracks in the rock around Yucca Mountain?
        Mr. Barrett. Yes.
        Senator Reid. Is it true that earthquakes are normally
    proceeded by stretching and distortion of the earth?
        Mr. Barrett. Yes.

                               earthquake threats

        Senator Reid. Because the Yucca Mountain region experiences
    the third highest frequency of earthquakes in the United
    States, I suppose that it is not surprising to see that
    significant stretching and distortion of the earth is there,
    would you agree, yes or no?
        Mr. Barrett. I cannot. There is some. It is a relative
    thing. Yes, there is stretching at Yucca Mountain----
        Senator Reid. Okay. That is the question.
        Mr. Barrett [continuing]. But we do not believe that
    stretching is causing any of the fractures that have to do with
    the water infiltration.
        Senator Reid. That is your opinion.
        Mr. Barrett. Yes, sir.
        Senator Reid. Okay. So we have agreed on a number of things
    here this morning. What I cannot understand, and what I believe
    you should not tolerate, is the dismissal of the threat of
    earthquakes to the performance of the repository. Water is the
    worst threat to containment.
        It is reaching repository depths many times faster than
    expected, because of cracks in the rock. There may be some
    dispute as to how the cracks got there, but everyone
    acknowledges that water is getting there quicker and quicker.
        Earthquakes and their associated distortion can proliferate
    these cracks, leading to greater amounts of water reaching the
    repository faster. So I would say that the cracks, however they
    get there, would pose a threat to the repository performance,
    is this true or false?
        Mr. Barrett. The way that question was put together, I
    would say that is false.
        Senator Reid. Okay. Can you extend this argument to the
    rate at which uncontained radioactivity reaches the
    groundwater?
        Mr. Barrett. Could you say that again?
        Senator Reid. Yes. If there is an argument that the water
    can reach where the containment is, would you agree that
    radioactivity would follow the path of water?
        Mr. Barrett. Radioactivity will go with the water. There
    are different layers from the surface to the Yucca Mountain
    repository horizon and from that the horizon down to the
    saturated zone below it. There are different scenarios.
        Senator Reid. Thank you, Mr. Chairman.
        Senator Domenici. It seems to me, since I have 20 minutes
    before I have to leave, that I can still yield to you for a
    couple of questions.
        Senator Campbell.

                        storage of waste at rocky flats

        Senator Campbell. Thank you, Mr. Chairman. In my opening
    statement I did mention this rumor I had heard that DOE was
    talking about putting temporary tent storage at Rocky Flats,
    and I appreciated Mr. Owendoff's commitment that we are going
    to finish that up and get it cleaned up by 2006. We have kind
    of pushed that date back a few times, as you know.
        But I also mentioned that our communities are just going to
    rebel at that thought of temporary storage, and I wanted to
    tell you that my reaction will also be somewhat near nuclear. I
    would like your comment on that, if that is true or not, that
    they intend to store any hazardous or radioactive material in
    tents.
        Mr. Owendoff. Senator Campbell, I think your concern and
    your angst are also shared by Secretary Richardson, which he
    has testified on----
        Senator Campbell. He will be testifying before another
    committee this afternoon, Interior Appropriations, and I will--
    --
        Mr. Owendoff. So you will hear firsthand----
        Senator Campbell. You bet.

                         plutonium oxide stabilization

        Mr. Owendoff [continuing]. Senator. We are in a box. We
    believe that it is necessary to continue the stabilization of
    the plutonium oxides that are at Rocky Flats. An option for us
    is to not stabilize those oxides that ultimately will go down
    to WIPP.
        So the approach that we are taking is, we want to continue
    the progress on stabilizing those oxides and putting them in
    containers. These are very robust containers that are used to
    transport waste to WIPP. Then what we are looking at are
    options that, if for some reason WIPP does not open in a timely
    fashion this year, that we will have places to put those
    containers.
        Now, one option that we are looking at is putting those
    containers in an existing facility. If we put them in an
    existing facility, then that would delay when we would be able
    to decontaminate and demolish that existing facility.
        Another option would be some temporary storage--I know they
    are referred to as tents, but they are not like the tents my
    boy is in over in Saudi Arabia right now. They are fabric
    structures, with a concrete or paved floor in them.
        We believe that can be an appropriate option, at a very,
    very low-dollar cost. We realize, though, that the message that
    that can send is that we are temporarily storing the waste, but
    it is not concrete structures or long-term storage. In the
    balance, though, Senator, we believe that is an appropriate
    approach.

                       additional workload at rocky flats

        Senator Campbell. Well then, I just have to tell you, Mr.
    Chairman, as a member of this committee or the full committee,
    I intend to try and put language in our appropriations bill
    that prevents that from being stored in anything that I would
    describe as a tent or temporary storage.
        Let me also ask you this, if we are committed to trying to
    get that cleaned up by 2006, why are we adding more work to it?
    It is my understanding that the Department has asked Savannah
    River, as an example, to develop plutonium canisters, and now
    Rocky Flats has been told that they will have to do that.
        If we are going to close it up by 2006, why are we adding
    to the workload, which would tend to push the closure back
    further?
        Mr. Owendoff. I think if we look at the whole picture with
    Rocky Flats, we are asking many of the other sites to accept
    material from Rocky Flats, so we have asked Savannah River to
    accelerate when they would receive these plutonium oxides.
    There are certainly some increased costs that Savannah River
    has experienced as a result.
        Senator Campbell. I know very simply this, that you are
    going to add to the workload. Can we get a commitment that it
    is not going to add to the time frame by which it will be
    closed?
        Mr. Owendoff. That is our commitment, Senator, and what my
    disappointment is, whatever information that your staff may
    have gotten from the contractor was, that they did not relate
    to you the reductions in cost that we have been achieving. So
    all you have been seeing is more and more, but we have been
    receiving significant reductions in costs, which we are going
    to continue some $70 million----
        Senator Campbell. Well, it is not only the money, I am
    concerned about time frame, too.
        Mr. Owendoff. I am going out this evening, Senator
    Campbell, to Rocky Flats to talk about this.

                               transuranic waste

        Senator Campbell. All right. One last question, do you
    agree with New Mexico, there is one type of waste called
    transuranic waste, and it is my understanding that we have
    asked for--the President's budget is a pretty healthy
    commitment, but there is only one place where that waste is
    developed, and that happens to be at Rocky Flats, and there are
    different kinds, some radioactive, some not hazardous, and so
    on, that will eventually go to WIPP, but does that mean that
    there will be any additional parts of that monies that will be
    going to Rocky Flats, since that is the only place where this
    stuff called TRU is developed?
        Mr. Owendoff. Senator, Rocky is not the only place that
    has----
        Senator Campbell. Oh, it is not.
        Mr. Owendoff [continuing]. TRU waste. Los Alamos, Savannah
    River, Hanford, Oak Ridge have TRU waste.

                                lawsuit at wipp

        Senator Campbell. Well, that takes care of that question.
    The last thing is that in the State of New Mexico we have this
    ongoing lawsuit. What is your agency doing to try and help the
    state resolve the outstanding problem so it can be opened?
        Mr. Owendoff. Well, the key date is next Tuesday, when
    Judge Penn here in the District Court is going to rule on the
    injunction, and I believe at that time we will have a clearer
    picture, Senator.
        Senator Campbell. Okay. Thank you, Mr. Chairman, I
    appreciate you allowing me to ask those questions.
        Senator Domenici. Thank you. Senators Murray and Craig,
    could I just impose on you? I have not asked any questions yet,
    and I must go up to the sixth floor and finish the budget
    markup in 15 minutes.
        I would like to ask a few questions, and then if one of you
    want to stay beyond that for your questions, you are free to do
    that.
        Senator Craig, of course, you are on the committee. It
    would be good if you could maintain the committee functioning
    for a while. Senator Murray has to leave when I leave, right?
        Senator Murray. Yes.
        Senator Domenici. So why don't you take a minute or two
    right now. You said you needed two.

                              hanford site budget

        Senator Murray. Just a couple of quick questions, Mr.
    Chairman. Thank you.
        Obviously, the Hanford budget is critical for those of us
    in Washington State, and I was pleased to see the President's
    budget with an additional $100 million. I hope this committee
    can support it. Mr. Owendoff, can you just quickly tell us what
    that additional funding will be for?
        Mr. Owendoff. Yes, ma'am. The portion of that additional
    money going to Hanford will be used to support tank waste
    operations, the Plutonium Finishing Plant operations, and work
    at K Basins.

                  tank waste remediation system privatization

        Senator Murray. Now, let me ask you about the TWRS, or the
    tank waste remediation system privatization request. This is
    something I have worked hard on, and Congress has been
    reluctant in the past to fully fund that. Can you tell us what
    will happen if Congress does not fund that?
        Mr. Owendoff. There are two things, Senator Murray. One is
    the $106 million for the 2000 budget request, and the other is
    the funds that we are requesting for the advanced
    appropriation.
        The reason that we are requesting advanced appropriation is
    we believe that that will add to the confidence of the
    commercial lenders, as we go through the next 24 months of
    developing the design and the financing package for TWRS. This
    will give confidence to the lenders that we are serious about
    this project and in support of this project.
        As you well know, in the past our record has been somewhat
    spotty as far as large projects having support, continued
    support, so we use this as a method to get that continued
    support and drive down those costs.

                              hanford site manager

        Senator Murray. Thank you. Finally, we have to get an
    experienced innovative site manager at Hanford. Can you tell me
    when the Department is going to appoint somebody?
        Mr. Owendoff. The Secretary indicated that it was his goal
    to try to get a manager by the end of this month for Hanford. I
    know that is difficult and challenging, but that is----
        Senator Murray. We are waiting for it. Thank you.
        Mr. Owendoff. Thank you, Senator.
        Senator Domenici. Thank you very much. Well, I have a very,
    very long series of questions. I obviously will not get them
    done, but I will submit them to both of you.
        Senator Reid. Mr. Chairman, because of the time I did not
    ask questions of James Owendoff. I would ask permission to be
    able to submit those in writing to him.
        Senator Domenici. Without objection.

                           estimated cost of cleanup

        Senator Domenici. Maybe 2 weeks to respond, is that fair
    enough for you-all? Okay. What is the current estimate, Mr.
    Owendoff, to clean up the waste generated by nuclear weapons
    activities in the past years, and how long will it take to
    complete the cleanup.
        Mr. Owendoff. Our estimate, based on analysis that came in
    last June, Senator, is $147 billion, and that is our projection
    through year 2070. We will have an update to that this summer,
    where we will update those numbers. The good news of that
    effort that we see, is we go down by each site, project by
    project at each site, and understand the scope and the costs.
        Senator Domenici. How does this estimate, even though you
    are going to update it, how does it compare to previous
    estimates, and what is the reason for the difference, if there
    is one?
        Mr. Owendoff. We have had in the past, where the estimates
    have been $200 billion, $300 billion.
        The difference is that I think we have looked at some
    realistic cleanup goals, what needs to be cleaned up, what
    material needs to be disposed of, and what are those
    technologies that do that. So there is a whole series of things
    that we can certainly share for the record on those.
        [The information follows:]

           Comparison of Cost of DOE Cleanup With Previous Estimates

        In 1995 and 1996, as requested by Congress, the Department
    developed its first estimates of life-cycle cost and schedule for the
    remaining EM cleanup effort. These Baseline Environmental Management
    Reports (BEMRs) described the estimated scope of the EM program. The
    1996 report stated that, as a mid-range estimate, the program would
    cost approximately $230 billion (constant 1996 dollars) spent over a
    70-year period, using certain assumptions about funding levels,
    productivity, and land use in developing the estimate.
        The Accelerating Cleanup: Paths to Closure report issued in June
    1998 reported a life-cycle cost estimate of $147 billion. The $147
    billion life-cycle estimate was adjusted to form the basis of EM's
    portion in the Department's fiscal year 1998 Annual Financial Report
    for fiscal year 1998 estimate, which was determined to be about $145
    billion.
        The primary reasons for the difference between BEMR and Paths to
    Closure can be attributed to the fact that BEMR: (1) included costs for
    both ``legacy'' waste associated with historical nuclear weapons
    production and nuclear related activities, and newly generated wastes;
    (2) included costs for the eventual transfer of DOE facilities not
    currently in the Environmental Management program; and (3) in some
    cases, used different end-state assumptions than Paths to Closure.
        Paths to Closure addresses a somewhat different scope. For example,
    Paths to Closure includes costs for legacy waste cleanup but not newly
    generated wastes, and excludes costs for any facilities not currently
    in the Environmental Management program. Additionally, Paths to Closure
    reflects improved estimates for a number of projects and improvements
    in efficiency in accomplishing the same or comparable activities,
    thereby lowering total life-cycle costs of the program. In addition,
    $145 billion representing EM's portion of the fiscal year 1998
    environmental liability statement reflects future estimated costs
    starting in fiscal year 1999, while the 1996 BEMR estimates costs
    beginning in fiscal year 1996.

                                level of cleanup

        Senator Domenici. All right. What level of cleanup is
    assumed in the 2006 plan? Is the Department assuming a mid-
    level cleanup or maximum cleanup in this plan?
        Mr. Owendoff. Mr. Chairman, we look at each site
    individually. The key is what is the land use. In the case of
    the Mound facility in Ohio, we are looking at industrial
    standards. For the Fernald site in Ohio, it is open space. For
    Rocky Flats, it is also open space. So there is a difference
    between the industrial, open space, versus residential
    standards.
        Senator Domenici. Is there any contention by anyone in
    litigation or at the local level that says that approach is not
    valid?
        Mr. Owendoff. I think we will always see some concern and
    some discussion back and forth on what the appropriate future
    land use should be. Certainly, there are local governments and
    communities that are concerned, just as there are on Superfund
    sites, that if you do not clean them up to background levels,
    that that might encumber the use in the future. But we believe
    there is a reasonable tradeoff that needs to be discussed.
        Senator Domenici. Well, I, for one, want to make my
    observations part of the record at this point. I am convinced
    that we are going to have to do some work on better defining
    the risks of radioactive levels, and that we will not be able
    to meet our cleanup goals if we leave the standards as they
    are.
        They are all based on some linear extraction. There is no
    real research, although we just started now with some real
    research on that aspect of the danger of low-level
    radioactivity. I want you to know we will try to support you
    with reference to its different--the standard could be
    different, if you have industrial sites or if you have open
    space, as compared with residential, otherwise, we are never
    going to get some of these sites cleaned up. We will just sit
    there and spend money forever.

                                  fusrap sites

        There is a little known program, it has kind of a funny set
    of letters, F-U-S-R-A-P, FUSRAP. Now, Congress gave the program
    to the Corps of Engineers with an assignment to take on a few
    of these cleanup sites and see if they could make better
    progress than we have been doing. Do you have a report or
    something to tell us about how they are doing?
        Mr. Owendoff. The Corps of Engineers, Mr. Chairman, to my
    understanding, has submitted a report. It has not been our
    task, nor has the Congress asked us to oversee the----
        Senator Domenici. No. I am certainly not asking you to do
    that. You have enough to oversee.
        Mr. Owendoff. In answer to your question, Mr. Chairman, I
    do not.
        Senator Domenici. Okay. I would like the committee to know
    that while this is a small program, it very well might point to
    some approaches where the Corps of Engineers might be able to
    come along, and rather than take as long as the Department of
    Energy takes, for some reason, whatever they are, they seem to
    be making some headway and they are happy with their
    assignment. So, we will get a report from the Corps.
        Mr. Owendoff. Mr. Chairman, if I could just comment just on
    that. As we have seen, certainly on Rocky Flats and the others,
    there is a necessary integration across the complex for
    materials, and to make things happen. FUSRAP was very
    straightforward--get material from one place and dispose of it.
        Senator Domenici. Well, nonetheless, it appears that you
    were not able to get it done as quickly as they have.
        Mr. Owendoff. I think we can demonstrate that we are doing
    that.

                           twrs privatization project

        Senator Domenici. Good. I hope so. I understand that the
    requirement for budget authority for the TWRS privatization
    project increases from $106 million this year, to $600 million
    in 2001, and $660 million in 2002. Am I correct, and if so,
    what will the impact be on the project, if the committee is
    unable to provide the additional budget authority? What options
    do you have?
        Mr. Owendoff. I believe, Mr. Chairman, that we will have a
    limited number of options, because trying to stretch this
    project out is really going to be very difficult. We have had
    to make commitments in the past down at Savannah River in
    building a high-level waste vitrification plant, and I believe
    we need to do the same thing in Hanford.
        Let me state, though, Mr. Chairman, quickly, we are looking
    at a range of alternatives of financing and approaches, so we
    will be coming back to the committee over the next 2 years and
    sharing with you that range. So we are not going to give you
    just one price.

                   funding requirements for fiscal year 2001

        Senator Domenici. For all the programs, how much is your
    2001 over baseline assumptions?
        Mr. Owendoff. We do have a significant problem. Those
    estimates will be coming in to us in May, Mr. Chairman, but I
    know we have some challenges in 2001.
        Senator Domenici. So, your funding requirement is going to
    be up substantially, right, is that what you are saying?
        Mr. Owendoff. That is what I am hearing from the field, but
    I do not have dollars. I would normally anticipate that that is
    what the field----
        Senator Domenici. I would very much appreciate it if in
    your response to questions you would try to give us a better
    handle on what that might be.
        Mr. Owendoff. I understand.

                            epa groundwater standard

        Senator Domenici. Let me just ask two questions about Yucca
    Mountain, please. As we understand, there is not just one
    standard you are trying to meet, there is an EPA standard for
    Yucca Mountain, and it includes a separate groundwater
    standard, is that not correct, Mr. Barrett?
        Mr. Barrett. EPA is still developing their standard, and
    they have not yet submitted one for agency review, but they are
    considering including a groundwater standard, as well as an all
    pathway standard.
        Senator Domenici. Well, whether it is final or not, you are
    certainly part of the mix that is looking at what standard they
    are thinking of setting, are you not?
        Mr. Barrett. We would have to demonstrate through science
    and technology that we could meet whatever the legally
    promulgated standard would be, and that would be the EPA
    standard which goes to the Nuclear Regulatory Commission, who
    would then oversee us. So yes, we would have to meet whatever
    it is.
        Senator Domenici. Well, are you participants in trying to
    help decide what the right standard is? Does DOE just sit on
    the sideline and watch that occur?
        Mr. Barrett. No, sir. DOE provides technical information on
    what we know about Yucca Mountain. The EPA will do the
    judgment, as to what should be the appropriate environmental
    safety standard for the country under the statute, but we
    provide scientific information on what science can and cannot
    do.
        Senator Domenici. Mr. Barrett, it seems to me when you were
    testifying, although you were not using a lot of words, because
    the questioner wanted you to be brief, you do not have to be
    quite so brief to me when I ask you a question. How could you
    give the estimates that you were giving of the possible success
    of Yucca when you must admit that whether we could meet the
    standards at all will depend upon what standard the EPA
    determines to be the appropriate standard with reference to
    groundwater. They could set a standard, could they not, that
    would make it impossible for Yucca to proceed?
        Mr. Barrett. That is correct, sir.
        Senator Domenici. From what you hear, they are moving in
    the direction that may very well have that standard, is that
    correct?
        Mr. Barrett. I expect that there will be a range of
    requirements for an EPA standard. Some of those may not be
    achievable, some of those may be achievable.

                           groundwater contamination

        Senator Domenici. Now, whether I like the standard or not,
    it just does not make any difference. They are charged with
    doing it, and that then yields to a very serious question, what
    do your models tell you about when and how much radioactive
    material, whatever the contaminant level is, will reach the
    groundwater under Yucca Mountain, and are these levels of
    concern to you?
        Mr. Barrett. In our viability assessment report, which was
    the reference at the time last year, we had estimates to when
    that would be. We did not expect to see any contamination off-
    site at Yucca Mountain for several thousand years.
        Nominally, at 10,000 years we expected to see, based on our
    probabilistic projections, around .1 millirem per year to a
    person who drank the water, had a garden, had cows; essentially
    was exposed to all pathways. We believe that that is not an
    unreasonable exposure to the person, and that is what we had
    there.
        Now, we do not know what the standard is. The standard will
    be duly promulgated, and we will compare the performance of
    Yucca Mountain against that standard, and that will be the
    criteria of----
        Senator Domenici. Could you tell us just quickly, how much
    does that .1 millirem--how do you compare that with what an
    average person gets daily in the United States?
        Mr. Barrett. It is a small fraction of the annual
    background. It is a small percentage, very small.
        Senator Domenici. I am going to leave now, but I would like
    to do this, since Senator Allard has been here so long, I would
    like to--Senator Gorton, did you have some comment you would
    like to make?
        Senator Gorton. Could I ask one very brief question----
        Senator Domenici. Yes.

                              hanford site budget

        Senator Gorton. Mr. Owendoff, the Administration, it seems
    to me, has come up with a much better and realistic Hanford
    budget this year. Our note, however, is that even at over a
    billion dollars it is a relatively modest $23 million short of
    the legal requirements of the Tri-Party Agreement. Is that the
    case, in your view, and if so, how do you propose to keep to
    the legal requirements of that agreement?
        Mr. Owendoff. Senator Gorton, certainly, if one looks at
    what the estimated funding needs are for all the various
    projects, there is some dollar amount on some projects, but I
    think, as you pointed out, when one looks at a billion dollars,
    there are some abilities to defer some things. But these we
    need to discuss with the regulators and the stakeholders,
    because everybody is engaged with the budget.
        So, I think there are some things that are not legally
    required that we could defer to accomplish, legally required
    activities. There's also the ability for us to get some prices,
    some lower prices than what we anticipated, so I think as one
    works through the year, that's where these----
        Senator Gorton. But you are committed to meeting all of the
    legal requirements of that agreement.
        Mr. Owendoff. Yes, Senator.
        Senator Gorton. Okay. That is all I have. Thank you very
    much, Mr. Chairman.

                          waste isolation pilot plant

        Senator Domenici. I would like to make one last comment. I
    note the presence of Senator Craig. He has a genuine interest
    in the status of WIPP, because of transuranic waste that is in
    his state.
        I would just say, we have a governor, he is elected by the
    people, he was elected by a very huge majority last time, and
    he is insisting that the environmental department of the State
    of New Mexico issue a permit before any materials are moved to
    our state.
        In addition, New Mexico cannot proceed any faster when
    there is a temporary injunction placed against them by a court,
    so everyone has their version of what they will not do.
    However, I think the reality is that New Mexico and WIPP may
    not be able to be open, because of one or other of these issues
    that I have just raised, I hope not, and I think that everybody
    will have to sit down and talk sensibly about that in the event
    that that is the case.
        I do believe that we are not far away from an opening date,
    but we have said that before; although, this judge is going to
    decide this coming Tuesday. Senator Craig.
        Senator Craig. Mr. Chairman, I hope we are not far away
    from the opening date. There is another date that is important,
    the legal commitment date created by a court between DOE and
    the State of Idaho to begin to move transuranic waste out of
    Idaho. That date is April 30 of this year, so I will be
    pursuing that question in a few moments. There are time lines
    out there, and the governor of the State of Idaho will act, no
    question about it, if that agreement is violated.
        He will have to act, for all the political reasons that
    Senator Reid, and I, and others become so exorcized about
    nuclear materials. The new governor of Idaho will have to
    respond, so I will pursue that question. There are time lines
    out there. The governor of New Mexico has an obligation to his
    people, but so does the governor of Idaho.
        Senator Domenici. I understand. I do not know that anybody
    is going to violate a Federal district court order, that is all
    I am saying. The judge will decide on Tuesday, and I am very
    hopeful that he decides that we have done everything that we
    were supposed to do. I have every reason, having been briefed,
    that that will happen.
        Senator Craig. Good.

                                rocky flats site

        Senator Domenici. My final comment is, Rocky Flats is doing
    so well. I think it would be interesting for you, if you can,
    to do an absolute analysis of what it is doing better than the
    other sites.
        There are certain characteristics about what is going on
    there that seem to me are not going on in some of the other
    sites, both as to local communities efforts and agreements with
    the states, and also with reference to management and the
    company doing the work. I mean everything seems to be just
    perfect. The match seems very, very good. It is not so
    elsewhere.
        Mr. Owendoff. If I could, just as a second, I think if you
    look at Weldon Springs, in Missouri, Fernald, in Ohio, Mound,
    in Ohio, I think you will see that those are preceding Rocky
    Flats, and we are making progress, they are closing.
        If you look at Weldon Springs, all the buildings are down.
    The pads are gone. The disposal cells should be finished up in
    2 years. Mound will be 2 years behind it. We are using those
    experiences to help us with the integration work at Rocky, so I
    believe we are not just waiting for Rocky to happen all at
    once.
        I think we are demonstrating that we are making progress at
    these sites, as well as making progress at the larger sites,
    like I mentioned at Hanford, taking the projects that were
    costing us $20 million down to $1 million by taking out the
    nuclear materials, getting the cost of the monitoring that is
    required down. So I believe, Mr. Chairman, that we are making
    demonstrable progress.
        Senator Domenici. Thank you. Maybe we can spend a little
    less money if you are being so successful.
        Senator Craig.
        Senator Craig [presiding]. Thank you very much, Mr.
    Chairman.
        I will proceed with the hearing, and in doing so, I will
    turn to my colleague from Colorado, who has waited here
    patiently. Do you wish to make any comments or ask questions
    before I make my comments and follow-up with questions?

                              rocky flats funding

        Senator Allard. I again want to thank the chairman of this
    committee for his support in my efforts to get Rocky Flats
    cleaned up as soon as possible. The target date right now is
    2006. I also want to recognize the efforts of your Secretary
    and my secretary for working to make sure that we have extra
    dollars in there, in this year's budget. I do recognize that. I
    personally thank him for that.
        I realize there are a lot of challenges, and I am heartened
    to hear that there is some optimism about the way the project
    is moving along. But there are a few things that I think I must
    raise just as a concern, because this is a number one priority,
    as far as I am concerned, for Colorado.
        I think it has gone on entirely too long, and I know that
    you do have interests in other states that have similar
    concerns, but my bottom line is that we could sure hold this
    out as an example of how sites could be cleaned up, and I think
    really by doing that could help your program and your
    assurances to other Americans who have similar problems that
    these things can happen.
        I do have a couple of follow-up questions that my
    colleague, Senator Ben Campbell, asked you, and I want to
    recognize his efforts and help also in a public way in helping
    to get Rocky Flats cleared up.

                          additional work requirements

        But recently you suggested that the Rocky Flat site team
    might be crying wolf about the effects of added scope
    requirements on its budget, and you further inferred that Rocky
    Flats failed to acknowledge benefits and/or additional funding
    somehow obtained from other sites, and my colleague, Senator
    Campbell, was coming up to that question and did not quite ask
    it directly like I have. I wonder if you might explain where
    these additional funds came from, and if you could be specific,
    I would appreciate it.
        Mr. Owendoff. Let me just take a step back, Senator Allard,
    if I may. If we look at where we were 3 years ago, we were in a
    situation at Rocky where we did not know where much of the
    spent nuclear materials would go--where the plutonium materials
    that were there would go. There was some general ideas, but we
    did not have a pathway.
        Senator Allard. Yes.
        Mr. Owendoff. It was at that time that we said, within the
    Environmental Management budget, let us take on a man-on-the-
    moon goal, what can we do in 10 years for the whole complex,
    not just Rocky. I'll get to Rocky specifically, but we said,
    what can we do across the complex.
        We were very sensitive that both the Congress as well as
    the American people are not going to be satisifed with $6
    billion a year for the next 70 years. That just will not
    happen.
        Now, by taking that goal on we could not demonstrate what
    are all the activities that we are going to have to put in
    place to meet the 2006 goal, just like we did in the man-on-
    the-moon program, but we said, if we do not challenge ourselves
    there, then for sure we will never get there. Some of the
    things since then that have taken place are, we have moved
    highly enriched uranium to Oak Ridge, we have moved plutonium
    pits, the useable material, to Pantex, and there will be some
    materials that will be utilized at Los Alamos.
        Also, we have accelerated removal of one material which
    will go to Savannah River to be processed, some of the higher-
    grade oxides. In fact, we have even modified an existing
    facility. Instead of waiting for a brand new facility, we
    looked and we modified a current facility for the storage of
    those materials that allowed us to have that acceleration.
        Now, when we looked at Rocky Flats, we said the biggest
    thing that is costing us in the way of, let us say steady-state
    expenses, is the amount that it takes to keep it running as
    well as the safeguards and----
        Senator Allard. Securities.
        Mr. Owendoff [continuing]. Securities. Exactly right. So
    the quicker we can get those down, then the greater savings
    that--I mean more money can go into cleanup, the less money has
    to go into the safeguards and securities.
        By the way, I have a very cooperative working relationship
    with Jesse Roberson and with Bob Carr, so we are not in an
    adversarial relationship. In fact, as I mentioned to Senator
    Campbell, I am going out this evening and will spend all day
    tomorrow at Rocky Flats, and one of the things that we are
    looking at is the contractor, Kaiser Hill, who has submitted a
    baseline for closing Rocky in 2010.
        We know that there are opportunities then to then pull that
    closure date to 2006, and what we want to do is to strategize
    to ensure that there are not other opportunities for us to have
    higher confidence to bring those costs down--and bring that
    project in.
        Senator Allard. So your bottom line is, by facilitating the
    disposal of some of the more radioactive material there earlier
    on, that is where the cost savings comes down----
        Mr. Owendoff. Yes.
        Senator Allard [continuing]. And then consequently, you are
    asking for additional responsibilities for Rocky Flats to
    assume. I think my colleague mentioned the containers. So you
    are saying, well, we have that, we expect to absorb those other
    costs, is that what you are saying?
        Mr. Owendoff. Well, let me state this. The one reason that
    Kaiser Hill requested that they be allowed to have the contract
    to purchase the containers is, they were going to be purchased
    by Savannah River, the receiving site----
        Senator Allard. I see.
        Mr. Owendoff [continuing]. But Kaiser Hill said, we believe
    that is an integral part in the mechanics of our business. When
    would Rocky Flats receive them, would the containers be on
    spec, and things like that. So what they have asked is that
    they be able to take over the procurement responsibility.
        Now, I certainly realize that from a funding standpoint, I
    am the one that has to make some balances across the complex
    and to understand where we are. I believe that we held flat
    funding, our request had been $625 million, as you mentioned.
    It was ``plussed up'' within the Congress.
        Even though we had some small increases, we held to that
    amount, and we had some tough choices across the complex. So we
    believe that by requesting at the higher level in the 2000
    budget request, doing that, that we had provided some increases
    from where our plan was last year.
        Senator Allard. There is some disagreement, I think,
    between Kaiser Hill, maybe, on this, and maybe we can get to
    the bottom of that. We will work on that. We will work with you
    and we will work with them and see just exactly what is
    happening there.

                    alternatives for storage at rocky flats

        The scope changes have started eating into some of these
    efficiency savings for some money that would be spent on
    accelerated closure into funding. Scope changes, for example,
    the accelerated demolition of buildings 771 and 779 is being
    put in danger, because money for the demolition of these sites
    is instead of being used for the purchase of the--that is what
    we talked about, was the 997--and the building of the tents
    now. Are you aware of how much money would be saved yearly if
    we could get these buildings down?
        Mr. Owendoff. I do not have in my head, Senator Allard----
        Senator Allard. Does $60 million sound okay to you or close
    to range?
        Mr. Owendoff. Well, that is a lot of things. If we look at
    the construction of facilities, we are talking in the $3
    million to $4 million for potentially additional temporary
    storage, but I think what is key there is, how much would we
    build, what would it look like.
        My preference is that we would continue on with the
    demolition of a facility and not try to use it as temporary
    storage, because I believe that the other alternatives are a
    very cheap way to go. The fabric structures are very cheap,
    Senator.

                  costs associated with delay in opening wipp

        Senator Allard. Could you tell me the hidden costs of WIPP
    not opening on time, as they would apply to Rocky Flats?
        Mr. Owendoff. We are working on what those costs are. I do
    not believe that they are significant through this year. As
    long as we can get WIPP open within this year, they are not
    significant costs, but once we go beyond this fall, that is
    when we have to start making the commitments on some additional
    temporary storage, because we believe that it is prudent to
    continue stabilizing the oxides, and we need to have some place
    to store those containers.

                        shipping non-mixed waste to wipp

        Senator Allard. Well, I think my colleague shares the
    concern, the Idaho delegation and Colorado delegation have the
    same concern about the WIPP. We spent over $2.1 billion, and
    then we are not putting anything in there. It seems crazy, to
    me, to ask the taxpayers to do that, and I think that it is
    important that we get that open as soon as possible, and try to
    work on this.
        We have reviewed some of the law, and whatnot, and I would
    appreciate a yes or no answer on this. Does DOE have the
    authority to ship straight, non-mixed, that's the transuranic
    waste, to WIPP, without the State of New Mexico approval?
        Mr. Owendoff. Let me submit that, because I want to make
    sure we have the current injunction. You did not refer to the
    injunction----
        Senator Allard. No, I did refer to the----
        Mr. Owendoff [continuing]. You referred to the State of New
    Mexico.
        Senator Allard [continuing]. Because I am going to cite you
    a specific reference in law, that reads like this, and it is my
    reading of RCRA, and as long as you are not mixing stuff with
    it you do not have to go for a RCRA permit. It is 42 USCA,
    6903(27), that states, ``Solid waste does not include special
    nuclear or by-product material, as defined in the Atomic Energy
    Act of 1954.'' If, in fact, the material at Rocky Flats falls
    within the definition of this, then it would not require a
    state RCRA permit, would it not?
        Mr. Owendoff. It should not, if there are not hazardous
    materials.
        Senator Allard. Right. If it is just straight material, it
    goes out. If it is not mixed, it can go right to the State of
    New Mexico, and there should not be any ability for the State
    to prevent it from going there, should there?
        Mr. Owendoff. I am not trying to defend the State, but let
    me tell you that from what the State has said is, we need to
    ensure that that, indeed, is non-mixed, that there are no
    hazardous contaminants in it. So even though we would say it is
    non-mixed, New Mexico has indicated we need to have some
    assurances on why it is non-mixed.
        Senator Reid. Would the gentleman yield?
        Mr. Owendoff. Yes, I would be glad to.
        Senator Reid. If the reasoning of New Mexico is right,
    Nevada ears' should be perked up real loud, because if New
    Mexico can keep it out on that basis, by having the
    environmental agency of the state say it cannot come in, Nevada
    should be able to do the same thing.
        Senator Allard. A reasonable argument.
        Mr. Owendoff. Yes.
        Senator Allard. It just seems to me that we are letting
    some unnecessary delays occur here, and I just wanted to press
    that point in a public way, because I think it is an important
    point.
        Mr. Owendoff. Senator Allard, if I may, I think this is, as
    we were talking about, in general, how do we accelerate things,
    and the ideas--several years ago we would look at and felt we
    were going to have a RCRA permit for WIPP, and that there would
    be no need to have to try to send just non-mixed, or straight
    radioactive material, without any hazardous constituents.
        However, one of the things that we looked at to be able to
    accelerate activities is, let us go through and only ship non-
    mixed waste, rather than waiting until we did have the RCRA
    permit, so that we could continue with shipment of the
    material. So we looked at--that was not on our initial
    baseline.
        Senator Allard. My understanding is that we have non-mixed
    waste, and we would like to get it out, get it moving.
        Mr. Owendoff. That is correct. That is correct.
        Senator Allard. I want to thank the committee and the
    chairman for his indulgence. I have some other questions, but I
    would like to submit those to you, and if they would fall under
    the deadline of the committee for response, I would appreciate
    it.
        I wanted to make my major points here, and Mr. Chairman,
    you graciously allowed me to do that, and I thank you very
    much. We continue to look forward to working with you, and we
    are going to continue to push for the closing of 2006. Thank
    you.
        Mr. Owendoff. Thank you, Senator Allard.
        Senator Craig. Senator, thank you very much. We share some
    common interests, and I am pleased you could be here this
    morning to ask those questions. Gentlemen, thank you very much.

                   shipment of transuranic waste out of idaho

        Assistant Secretary Owendoff, you heard me lead up to the
    ultimate question that I will ask. Today is March 18. The
    Department of Energy has a deadline of April 30 to begin moving
    transuranic waste out of the State of Idaho.
        When Secretary Richardson appeared before the Senate Energy
    Committee last month he testified that the State of New Mexico
    had repeatedly pushed back the date of issuing the hazardous
    waste permit for WIPP, and as a result he has withdrawn $10
    million from the WIPP budget to provide funding for
    alternatives to WIPP, which will still meet DOE's deadline of
    April 30 to the State of Idaho.
        What alternatives are in the works? Will your plan ``B,''
    if you have one, still meet the April deadline?
        Mr. Owendoff. Senator Craig, we are looking at
    alternatives. I think as you can appreciate, because that can
    involve other entities, that those can be very sensitive,
    certainly.
        Senator Craig. We are all very sensitive about this issue.
        Mr. Owendoff. I appreciate that. But I want to say that we
    are going to certainly abide by what was in the settlement
    agreement, that indicated if material is not--if TRU waste
    shipments do not start by April 30, then that holds up foreign
    research reactor fuel from coming into the State. Now, we do
    not take that lightly.
        Our commitment is continued, and I can assure you that a
    lot of my time is spent on this issue of looking at a number of
    alternatives which would allow us to begin that shipment. So
    this is not a casual date to us----
        Senator Craig. No. That is what I wanted----
        Mr. Owendoff [continuing]. As the end of March date is for
    the TMI fuel to move out of wet storage. So I have those dates
    right in front of me, Senator Craig.
        Senator Craig. Well, Senator Allard had mentioned the type
    of waste--non-mixed waste--that we think under the law can move
    and should move to WIPP now. I think we have some 50-odd
    barrels of the nearly half-million--let me repeat that--nearly
    half-million drums of mixed transuranic waste in Idaho.
        So we are kind of the waste king when it comes to the
    transuranic materials, but we believe those 50 drums could
    move, should move, and it is important that our country
    demonstrate they will move them, that there is a will to move
    waste, and to handle it appropriately.
        I think it also demonstrates to the states involved that
    they cannot play the politics of waste when there is no science
    to back it up. That is very important.

                                 pit-9 at inel

        On Pit-9, when Secretary Richardson appeared before the
    Energy and Natural Resource Committee to testify on the DOE
    budget, I had a series of questions for him regarding DOE's
    intent to proceed on Pit-9.
        Secretary Richardson replied that due to pending
    litigation, Pit-9 was the topic he needed to discuss with me
    privately. We are working to get that meeting together. I have
    been in touch with his office. I hope we can put that together
    right quickly.
        Would you convey to the Secretary my eagerness to discuss
    this issue? I think it is important that it get handled
    appropriately and in a timely fashion. It potentially has
    impact on new contracts, new contractors, as it relates to how
    the site gets managed, and it is just one of those things that
    is incumbent upon all of us that--attorneys love to sue, and
    they love to play legal games, but sometimes we are well ahead
    if we all sit down at a table and resolve issues and do so in a
    straightaway fashion.
        Have you received any new direction from the Secretary
    regarding the use of alternative dispute resolution for Pit-9?
        Mr. Owendoff. I have not, Senator.

                         three mile island fuel storage

        Senator Craig. Okay. Another milestone in the DOE
    settlement agreement with the State of Idaho, calls for moving
    Three-Mile Island fuel stored in Idaho from wet storage to dry,
    as we have discussed, by June 1, 2001. Fuel movement must be
    started by March 31 of this year.
        Mr. Owendoff. That is correct.
        Senator Craig. Is that project on track?
        Mr. Owendoff. It is, Senator Craig. In fact, Warren
    Bergholtz, the acting manager, this morning is with the NRC. We
    should be receiving that license from the NRC. We have some
    other activities that we need to accomplish before the March 31
    date, but we are proceeding with those, and we do anticipate
    that we will be able to start fuel movement. We do not see that
    there is a showstopper problem. It is just working through, as
    you can appreciate----
        Senator Craig. Sure.
        Mr. Owendoff [continuing]. With the events that took place
    last summer. We will probably err on the very cautious side,
    but anyway, we expect to meet that date.

                          spent nuclear fuel programs

        Senator Craig. That is good news. DOE's national spent fuel
    program and its integrated spent fuel program are managed by
    the INEEL. The work is actually carried out at a number of DOE
    labs, including Argonne and Sandia. The programs were funded at
    $35.5 million in fiscal year 1999. In the year 2000, DOE has
    requested $22 million. I find that very disappointing.
        These spent fuel programs are responsible for making sure
    the information is available to include DOE spent nuclear fuel
    in the Yucca Mountain repository environmental impact statement
    and license application, which we all know is a critical last
    step in DOE's cleanup program.
        It is my understanding that DOE is managing about 250
    different spent fuel types, and that the DOE license
    application for Yucca Mountain must include information on the
    specific fuel types to be disposed of in the repository.
        Will the proposed funding level allow DOE to obtain the
    information needed to include all DOE spent fuels in the
    license application?
        Mr. Owendoff. Senator Craig, we believe that the budget is
    sufficient to do that. The folks within Environmental
    Management are working with Lake Barrett's people, we believe
    that we have that appropriate information that is there.
        I must state there are some small amounts of what is often
    referred to as cats and dogs, very unique fuels that we know we
    are going to have to do some additional work on.
        There had been some shifting of activities in looking into
    the out years, based on some near-term things, some other
    things we needed to get done at Idaho, and also in looking at
    the schedule for the repository and the needed information. But
    we believe that the budget is appropriate, Senator Craig.
        Senator Craig. Well, the proposal to reduce spending for
    these programs by nearly 40 percent I think does call into
    question the department's commitment to ship fuel out of Idaho.
    I mean that is how I am looking at it through my glasses at the
    moment.
        Can you explain how such a drastic funding reduction is
    consistent with meeting the commitments DOE has made to the
    people of my state?
        Mr. Owendoff. Senator Craig, let me get an in-depth
    breakdown of those costs and that rationale, but in general,
    let me say that because of our commitment that I think is
    demonstrated, of moving the Three Mile Island fuel into dry
    storage, of the privatization project that we currently have on
    the street to move Peach Bottom fuel into dry storage, I think
    that we are demonstrating that we are taking those preliminary
    steps, demonstrable steps of stabilizing and reducing the costs
    for overseeing the spent fuel, and also putting it into a form
    that we have a confidence will be able to move into the long-
    term repository, without repackaging it.
        [The information follows:]

            Idaho National Engineering and Environmental Laboratory

        In its National Spent Nuclear Fuel (SNF) and Integrated SNF
    programs, DOE is focusing the requested funding on activities needed to
    support development of the geologic repository license application,
    while deferring activities that do not have to be completed until later
    in the process of preparing to send DOE's spent fuel to a repository.
    This approach allows us to accomplish those tasks that must be
    completed in the near term to stay on course to fulfill our commitments
    to the State of Idaho. The activities that are being deferred or
    reduced are in PBS ID-SNF-101 and PBS ID-SNF-102, as described below:
      --In fiscal year 1999, funding for repository design support was used
            for total system performance assessment and criticality
            analysis. In fiscal year 2000, further analysis of these topics
            is being delayed since the information provided by this
            activity is not needed until 2002.
      --In fiscal year 1999, DOE initiated an extensive release rate
            testing program for DOE spent fuels to demonstrate that DOE
            spent fuels will not be a major contributor to the repository
            release rate. Follow-up work on this task is being deferred by
            one year (to fiscal year 2001), since accomplishing the work on
            this slightly delayed schedule will still allow the results to
            be available in time to meet the schedule for potential
            submittal of the geologic repository license application in
            2002.
      --In fiscal year 1999, DOE provided significant support to Argonne
            National Laboratory in development of the electrometallurgical
            treatment system for sodium-bonded spent nuclear fuel. This
            effort will be essentially completed prior to fiscal year 2000.
        In fiscal year 1999, funding was required for development and
    procurement of hardware for the Multi-Detector Analysis System (MDAS--
    to conduct nondestructive assay and examinations to obtain
    characterization data for spent fuel). In fiscal year 2000, a reduced
    level of funding will be sufficient since the only remaining tasks are
    to demonstrate the MDAS technology.
      --In fiscal year 1999, funding was required to allow completion of a
            NEPA analysis for a container system to be used in transporting
            spent fuel from Idaho to an off-site repository. This
            initiative was required to meet a settlement agreement
            milestone. The NEPA analysis has been completed.
      --In fiscal year 2000, the level of funding for program support will
            also be reduced, consistent with the reduced level of effort
            overall.
        Finally, DOE has also identified emerging issues which must be
    addressed in fiscal year 2000 concerning development of information on
    DOE spent fuel to support geologic repository performance assessment
    for the license application. To ensure that DOE/EM supports preparation
    of the repository license application, DOE is working internally to
    fund these activities within the EM program.

                          defense spent fuel and waste

        Senator Craig. Thank you very much. Mr. Barrett, your
    program is in various stages of preparing both a repository
    environmental impact statement and the repository license
    application.
        In accordance with President Reagan's 1985 decision to
    dispose of defense waste in the civilian repository, will the
    EIS and license application now in preparation for Yucca
    Mountain make provisions for defense-spent fuel and waste?
        Mr. Barrett. Yes, sir.
        Senator Craig. Well, obviously, that is the answer I wanted
    to hear. I do not want us to get down the road aways and say,
    oops, we did not include that. Obviously, that is the mission
    now, and I am glad to hear that that is the case.

                    outyear funding requirements for cleanup

        A major issue the Department faces in Idaho and other
    cleanup sites is insufficient funding in the out-year budget
    plans to meet cleanup obligations. How do you expect to meet
    cleanup commitments to the states without significant growth in
    the out-year budgets?
        Mr. Owendoff. Senator Craig, certainly as I mentioned to
    the Chairman earlier, we know that in the out-years we do have
    some significant challenges. One of the ways that we are
    looking at of accommodating that is being able to get finished
    with sites like Weldon Springs, Mound, Fernald, and----
        Senator Craig. So what are we looking for, a renegotiation
    in cleanup schedules? Would that not be a part of it?
        Mr. Owendoff. I do not know that it is, per se--I am not
    going to say to you that we now have to renegotiate everything.
    I think one of the things that we need to continue to do is to
    look at the relative risk of the activities at each
    installation and facility, and to ensure that we have the funds
    going to the highest risk and look at what are the benefits for
    some of the other activities.
        In a balanced budget situation, as you well know, I think
    it is going to be very challenging for us in the out-years to
    have significant increases in the budget amounts, but I think
    at this time last year there were a lot of people crying wolf
    on what will happen on the 2000 budget. I think the Secretary
    demonstrated that he was able to have a hundred-million dollar,
    roughly a hundred-million dollar increase in the
    Administration's budget that came through the Congress. So some
    said at this time last year that it will never happen.
        In fact, the budget request would be reduced, but I think
    the secretary demonstrated that he can get those monies when
    they are necessary.

                    utility compensation for on-site storage

        Senator Craig. Okay. When the Secretary was before us on
    February 25, I submitted a series of questions regarding his
    proposal to compensate utilities for the on-site storage of
    their spent nuclear fuel in lieu of DOE's 1998 waste acceptance
    obligation. I had not yet received a reply to my questions. Do
    you have any indication of time when I might expect that
    response?
        Mr. Barrett. I know those are actively being worked on
    within the administration, and I expect they will be sent to
    you soon, sir.

                             on-site storage costs

        Senator Craig. All right. Mr. Barrett, the reason I ask
    that, and I will ask you a similar kind of question, because my
    guess is the Secretary drew upon the analysis done by you and
    your staff regarding the cost, feasibility, and any technical
    or legal pitfalls on such an approach.
        What kind of an analysis have you and your contractor staff
    performed on this subject or these subjects?
        Mr. Barrett. At the Secretary's request we scoped various
    scenarios that could be done. There were tremendous
    uncertainties, because it depends upon what the utilities would
    wish to do to try and implement such a proposal.
        For example, there is a very broad range between a utility
    that, for example, has space in their existing spent fuel pool,
    but may have an allocation, what their situation is. We would
    believe that the costs are very minimal for that additional
    burden resulting from the Department's inability to pick up
    that fuel.
        In the middle would be utilities that have an active power
    production program at their site, but have dry storage. We
    believe it would be best that perhaps we would assume the
    financial aspects of that, but they would do all the active
    management. That is a different situation. Then there are those
    reactor sites where the utility no longer generates
    electricity, and they are in the process of decommissioning
    that site, where the corporate entity would like to be able to
    go away. We have to consider the management of the fuel at
    these sites.
        Senator Craig. I appreciate all those scenarios, Mr.
    Barrett. Did you attempt to estimate the cost of the variations
    or the various proposals versus, let us say, the cost of an
    interim storage facility?
        Mr. Barrett. We have done cost estimates for the various
    situations that we are faced with. We are costing out HR-45,
    and we have information that will be coming for that. We intend
    to do the same for S. 608.
        When the Secretary said the estimated costs would range
    from $2 billion to $3 billion in that hearing, that was based
    upon a mix, as we saw the situation. Basically, we drew on
    generic industry numbers. We believe that to design, license,
    and construct the basic storage facility at a reactor plant
    would cost in the neighborhood of $10 million per site.
        Senator Craig. Now, go back and repeat the $10 million per
    site. How did you come to that figure?
        Mr. Barrett. That is based on our understanding of what the
    costs are in the industry for their sites that have done this.
        Senator Craig. Is that an annualized operation, annualized
    cost?
        Mr. Barrett. No, that is a one-time cost.
        Senator Craig. A one-time cost.
        Mr. Barrett. A one-time cost to go through licensing,
    design, and construction of a simple basic concrete pad. Once
    you go through that process, we assume that nominally costs to
    build storage containers are a million dollars a ton, or a
    hundred dollars a kilogram.
        That is a nominal industry cost today that utilities use.
    We use that number as well. Those costs are for a Nuclear
    Regulatory Commission-certified system.
        So then we looked at the operational costs of a site of
    around $5 million per year. That would be for a site where
    there would be a lot of stand-alone costs. It might be
    considerably less than that.
        So this is a broad range that we used. For example, we
    believe that there is virtually no cost of storing the fuel in
    the pool, if there is room in the pool. There is a very broad
    range of costs and there are many other circumstances that are
    site by site, utility by utility.

                    regulatory concerns for on-site storage

        Senator Craig. Does the proposal pose any regulatory
    concern? Did you look at all of the legal and the regulatory
    hurdles, including states and state utility commissions, and
    potential lawsuits? Did you factor in the cost of lawsuits and
    all of that? Did you run a guesstimate?
        Mr. Barrett. No, sir, we did not include costs of
    litigation on this. We did not, at this stage, go into any
    legal analysis concerning individual state laws.
        This was an idea, as the secretary said to you, to explore
    if there was interest, and we need to have dialogue before we
    can really come to any more specificity on----

                 nuclear regulatory commission--on-site storage

        Senator Craig. Did you have any dialogue then with the
    Nuclear Regulatory Commission on the proposal?
        Mr. Barrett. Not in any depth, but yes, there has been some
    dialogue between myself and Commission staff, not with any of
    the Commissioners, but with senior Commission staff.
        We looked at the activities in Environmental Management,
    for example, the Three Mile Island fuel, the fuel in Colorado,
    where DOE is becoming the licensee under the Nuclear Regulatory
    Commission. So we looked at those experiences as well.

                                     s-608

        Senator Craig. Okay. You already in your comments, Director
    Barrett, mentioned S-608, so obviously you are well aware of
    what Senator Murkowski and I, and Senators Grams and Crapo have
    done, and that is going to be a point of debate, and probably
    long hours on the floor between Senator Reid and myself in the
    near future.
        I trust by your comments you are generally familiar with
    the provisions of the legislation.
        Mr. Barrett. I am aware of the number. I understand we have
    a hearing on that next week, but I have not read it, sir.
        Senator Craig. Well, basically, in brief terms, what it
    says is an interim storage facility will be constructed in
    Nevada by 2003, and that is the date that I want to discuss
    with you. Your current plans, by this chart, call for a site
    recommendation to the President in 2001, and a repository
    license application by 2002.
        Why is interim storage in Nevada so problematic to DOE,
    since our interim storage facility starts after both of these
    dates in the year 2003?
        Mr. Barrett. As the Secretary stated, the Administration
    opposes designation of interim storage in Nevada, until the
    scientific work on the suitability of the repository is
    completed.
        Senator Craig. Is that a scientific argument or a political
    argument?
        Mr. Barrett. That was the Secretary's position.

                            long-range plan at ineel

        Senator Craig. Okay. And he is sticking to it. All right.
    DOE has made a commitment to Idaho to fund the long-range
    business plan in order to help assure the long-term viability
    of the INEEL. The commitment reached with DOE was $25 million a
    year for 5 years, yet this has somehow settled in at $22.5
    million, and has been difficult to achieve on an annual basis.
        Would you be willing to recommit to the previous level, and
    would you be open to potential increases in the future to
    address these specific needs?
        Mr. Owendoff. Senator Craig, as you mentioned, the specific
    straight funding is $22.5 million; however, there is also the
    lab discretionary research and development fund that pulls
    monies in general from all programs so those come in between $8
    million to $10 million, as well as there is a piece from a
    university consortium that brings some monies in. So Senator
    Craig, I believe we are well above the $25 million----
        Senator Craig. In other words, it is all in how you add it.
        Mr. Owendoff. That is correct.

                        complex-wide integration effort

        Senator Craig. All right. Well, we will sit down with you
    and see how you add it versus how we add it, and see if we can
    understand the differences.
        I understand that the environmental management system
    integration work done at the INEEL may be used as a model for
    DOE complex-wide integration of the cleanup program. This
    integration will be necessary to accomplish cleanup, I think,
    in a cost-effective way.
        Mr. Owendoff, how do you plan to utilize the INEEL systems
    and engineering expertise for complex-wide integration to the
    cleanup program?
        Mr. Owendoff. Senator Craig, I think you can see that
    today, we are using the integration work in the roadmap efforts
    that the INEEL prepared. It is being utilized by all the sites
    in looking at where they are today, what their plans for
    treatment and/or disposal.
        We are also taking those activities and looking at where do
    we have some shortcomings in research and development needs, so
    we are identifying where we have a critical path, and assessing
    how we can accomplish some more focused research and
    development on those key junctures.
        But we are utilizing those integration efforts today, and
    it is not only on the main waste streams of high-level waste,
    low-level waste, and transuranic waste, but there is probably
    over a hundred of individual material dispositions, I mean
    unique type of materials, radioactive materials, that again we
    are using those road maps today across the other programs
    within DOE Headquarters and trying to get to decisions on what
    should the disposition be of those waste streams. So I can
    assure you that that is an integral part of our strategy.

                       jack ass flats radiation exposure

        Senator Craig. One last question, and then I will turn to
    Senator Reid, if he has any more. Director Barrett, if I were a
    DOE employee or military personnel traveling across Jack Ass
    Flats, what kind of radiation might I be exposed to?
        Mr. Barrett. Basically, natural background in the Jack Ass
    Flats area. There is minimal radiation from any DOE activities
    in the Jack Ass Flats area, which is adjacent to Area 25.
        Senator Craig. What are current employees out there exposed
    to?
        Mr. Barrett. The natural background radiation, which should
    be, I do not know in the Jack Ass Flats specifically, nominally
    200 millirem, plus or minus.

                         groundwater potential problems

        Senator Craig. How does that compare with the millirem
    analysis that you gave in relation to groundwater potential
    exposure in the out-years of a Yucca Mountain facility?
        Mr. Barrett. Many orders of magnitude higher.
        Senator Craig. How about three-thousand?
        Mr. Barrett. No argument.
        Senator Craig. It is awfully important that we keep these
    measurements in perspective as to what is normal and what is
    real, and what humans are now currently receiving versus our
    attempted ability to measure out 10,000 years, or a thousand
    years. I think your figure there was, was it not, .1 millirem.
        Mr. Barrett. Ten-thousand years, .1 millirem. Yes, sir.
        Senator Craig. That was at 10,000 years. I think it is
    important that the record show those kinds of comparisons, so
    that there is a little bit of understanding by those of us who
    are novices in this area as to what these figures mean, or do
    not mean, for that matter. I thank you for that.
        It is obvious that we are talking about a minute
    measurement compared to background today, and are levels that
    those at DOE and the Defense Department find acceptable, and
    are based on current medical science, as to what a workforce
    can be exposed to. So I thank you very much for that.
        I turn to my colleague, Senator Reid.

                        costs to set up on-site disposal

        Senator Reid. The figures that we had originally were $5
    million to set up an on-site disposal, but you said $10
    million, so it is within that range, is that right?
        Mr. Barrett. I am sorry. Operating costs versus the capital
    costs to build the pad?
        Senator Reid. It is my understanding that you said that to
    construct an on-site storage facility would cost $10 million.
        Mr. Barrett. Yes, sir. A one-time up-front cost.
        Senator Reid. Some of the arguments we have heard before is
    $5 million, but in the neighborhood of $5 million to $10
    million is what it would cost.
        Mr. Barrett. And some could be $5 million and some could be
    $25 million.

                     total spent at the yucca mountain site

        Senator Reid. Yes. Right. Also, how much have we spent to
    this point in Yucca Mountain?
        Mr. Barrett. Approximately $3 billion.
        Senator Reid. That is construction. That does not count the
    overhead costs.
        Mr. Barrett. Very little of that are actual construction
    costs. Since we started in 1983, most of that has been
    scientific costs. Much of that work had been done in national
    laboratories. That is how much we had spent on the Yucca
    Mountain program. Some of that includes state monies, county
    monies, the whole Yucca Mountain budget allocation.
        Senator Craig. We have appropriated more than that in this
    program since 1982.
        Mr. Barrett. That is correct. For example, the repositories
    that we looked at, potential repository sites in Texas and also
    the monitored retrievable storage facility that we proposed in
    Tennessee. So all of that other work is around $2 billion.
        Senator Craig. In addition to the $3 billion.
        Mr. Barrett. Yes. At a cost of about $5 billion, I believe.
    I can check the numbers, if you want, specifically.

                      maintenance costs of on-site storage

        Senator Craig. It does not have to be exact. That is fine.
    Also, Mr. Barrett, it is my understanding that you had said
    that in addition to the costs of constructing an on-site
    storage facility there would be the costs of maintaining it,
    and they would vary from $1 million to $5 million a year, is
    that what you said?
        Mr. Barrett. Virtually none, zero. I mean if it is just
    additional fuel and--if the site has been decommissioned it is
    $5 million a year. There may be situations that may be more
    than that.
        Senator Reid. But we are in the ball park.
        Mr. Barrett. Yes.

                      costs of transporting nuclear waste

        Senator Reid. We have not at all here today talked about
    the costs of transporting nuclear waste if, in fact, there
    becomes a site available in Nevada, either temporary or
    permanent, is that right?
        Mr. Barrett. We have described those costs in the report we
    released with the viability assessment, which is the Total
    System Life Cycle Cost report. We have those costs, sir.
        Senator Reid. What would you estimate the transportation
    costs to be?
        Mr. Barrett. In the Total System Life Cycle Cost report for
    the 70,000 metric tons considered it is close to $6 billion.
    For the period that we costed to 2010, where we established the
    system, and then put the infrastructure in place to be ready to
    start moving fuel, approximately 17,000 tons of fuel, it is
    around $2 billion.
        Senator Reid. Those are current dollars.
        Mr. Barrett. Yes, sir. Actually, that is budget authority,
    but it is still in that neighborhood.

                         Additional committee questions

        Senator Reid. Mr. Chairman, I have no further questions,
    other than those we are going to submit in writing to Mr.
    Owendoff, which are really not on point at this time.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                    Questions Submitted by Senator Domenici

                 on-site interim storage of spent nuclear fuel
        Question. Mr. Barrett, could you explain the proposal put forth by
    the Secretary to participate in assisting the utilities with on-site
    interim storage of spent nuclear fuel produced by nuclear power
    reactors?
        Answer. The Secretary committed to work with Congress on nuclear
    waste issues. His objective was to begin a constructive dialogue.
    Taking title to utility spent fuel on site at reactors is a promising
    near-term solution that can address our contractual obligation to
    utilities. It is not intended to be a permanent solution or to alter
    the Administration's commitment to permanent geologic disposal. This
    proposal represents an alternative to years and billions of dollars of
    litigation. As the Secretary indicated in his testimony, the
    Department's proposal to take title to spent fuel at utility sites is
    in an early stage of development. We could take title consistent with
    our contract acceptance schedule. We could have utilities manage the
    facility or we could assume responsibility. The Department is exploring
    specific options, based upon individual circumstances at each utility.
    Such options would consider current operating status of a utility,
    availability of on-site dry storage, and utility financial needs. For
    instance, a utility with a permanently shut down reactor and no ongoing
    nuclear operations may want the Department to assume complete
    responsibility for the management of the spent fuel and storage
    facilities, while other utilities with operating reactors may prefer
    the Department only to take financial responsibility. We still have to
    address a range of issues, including liability, financial and
    operational responsibilities. In return for taking title to spent fuel
    the Department would expect the utilities to terminate their litigation
    and claims. We want to hear from the utilities and to work with
    Congress as this dialogue continues.
        Question. What is this program expected to cost, how will it be
    funded, and do OMB budget profiles support this effort over the next 5
    years?
        Answer. The Department's preliminary estimate is that the proposal
    could cost up to $2 to $3 billion through 2010. The Department is
    willing to enter a dialogue with Congress to ensure that the repository
    program continues to be adequately funded, as well as address the
    Secretary's proposal. In exploring any funding alternatives, the
    Department's objectives would be: (1) that the Department impose no
    undue burdens on either utility ratepayers or the taxpayers; and (2)
    that the revenues raised by the nuclear waste fee remain available to
    complete the nuclear waste management system.
                   acceleration of yucca mountain milestones
        Question. Mr. Barrett, I am sure that you are aware of the growing
    frustration and dissatisfaction by some regarding the pace at which the
    Department is moving to begin construction of a storage facility for
    spent nuclear fuel. Is there any way that the 2001 date to submit a
    recommendation to the President and the 2002 submission date of a
    license application to the NRC can be accelerated?
        Answer. The Viability Assessment identified the remaining technical
    work which must be accomplished and the schedule that must be met
    before submitting a Site Recommendation and a License Application.
    Provided that we have the funding that meets costs in our ``License
    Application Plan and Costs,'' we believe that we can complete the
    technical work, which includes complicated scientific testing and
    analysis, and evaluation of design alternatives, and accomplish a Site
    Recommendation and a License Application in 2001 and 2002,
    respectively. We believe that accelerating the schedule we proposed in
    the Viability Assessment would not allow us to address the remaining
    uncertainties that exist and must be addressed before a decision to
    recommend the site.
                     alternative options to on-site storage
        Question. Mr. Barrett, is on-site storage of spent nuclear fuel
    viable for the long-term?
        Answer. The U.S. Nuclear Regulatory Commission (NRC), through its
    regulatory and inspection processes, ensures the public health and
    safety for storage of spent fuel. The NRC, in its Waste Confidence
    ruling, 10 CFR 51.23, has indicated that spent fuel can be safely
    stored onsite for at least 30 years after a plant's operating license
    expired.
        Question. What other options is the Department exploring, other
    than on-site storage?
        Answer. The Department is committed to geologic disposal as the
    permanent solution for nuclear waste. The Department continues to
    proceed diligently to determine the suitability of the Yucca Mountain
    site as a permanent geologic repository. If the site is found to be
    suitable, the Secretary will make a decision whether to recommend it to
    the President for development as a repository.
        Question. What are the relative risks to the public associated with
    on-site storage versus storage in a facility such as Yucca Mountain?
        Answer. All commercial storage facilities, regardless of the
    location, are licensed by NRC and meet the appropriate NRC regulations
    to ensure safety to the public and the environment.
                 external oversight and payments-equal-to-taxes
        Question. Mr. Barrett, could you explain the reason why the request
    for external oversight and payments-equal-to-taxes doubles from $11.7
    million in fiscal year 1999 to $22.3 million in fiscal year 2000? What
    has changed since last year to require such a large increase in the
    payment to Nye County, Nevada?
        Answer. The increases from fiscal year 1999 to fiscal year 2000
    reflect the following: In fiscal year 1999, only $250,000 was provided
    to the State of Nevada for external oversight. In the fiscal year 2000
    Budget Request, $4.7 million is requested for State external oversight.
        For external oversight for affected counties, we have requested
    $108,000 less than that appropriated in fiscal year 1999.
        We have requested $2.03 million in fiscal year 2000 for the
    potential liabilities associated with the closeout of previous
    contracts for work performed for Yucca Mountain in prior fiscal years.
    This is a $1.84 million increase over fiscal year 1999.
        There is $140,000 requested for School-To-Work in fiscal year 2000.
    There were no funds provided for this purpose in fiscal year 1999.
        We have requested $10 million for Payments Equal To Taxes (PETT) in
    fiscal year 2000. The increase reflects the fact that the current PETT
    agreement with Nye County (FYs 1994-1999) expires on September 30,
    1999. The new agreement will reflect the increased value of facilities
    at the Yucca Mountain site and increases in work activities at the
    site.
        The following table illustrates these changes:

                            [In millions of dollars]
    ------------------------------------------------------------------------
                                                         Fiscal
                                               Fiscal     year
                                                year      2000    Difference
                                                1999     request
    ------------------------------------------------------------------------
    External Oversight--State of Nevada.....       .25      4.72       4.47
    External Oversight--Affected Counties...      5.54      5.43     (.11 M)
    Contract Close-out from Previous Fiscal        .19      2.03       1.84
     Year...................................
    School-To-Work..........................       .14       .14
    PETT....................................      5.72     10.00       4.28
                                             -------------------------------
          Total.............................     11.70     22.32      10.62
    ------------------------------------------------------------------------

                          cost of doe cleanup program
        Question. What is the current estimate to cleanup the wastes
    generated by nuclear weapons production activities in past years and
    how long will it take to complete this cleanup work?
        Answer. As reported in the Department's Annual Financial Report,
    DOE's fiscal year 1998 environmental liabilities estimate was $186
    billion over the next 70 years to complete the cleanup of wastes
    generated by nuclear weapons production and other government nuclear
    energy programs. Previous analyses (the 1995 Baseline Environmental
    Management Report, and the 1997 Linking Legacies report) indicated that
    about 85 percent of the cleanup work results from nuclear weapons
    production. The EM portion of the Department's fiscal year 1998
    environmental liabilities estimate was based on data used to develop
    the initial Accelerating Cleanup: Paths to Closure report (Paths to
    Closure) issued in June 1998, which reported a life-cycle cost estimate
    of $147 billion. The $147 billion life-cycle estimate was adjusted
    (e.g., removal of fiscal year 1997 and fiscal year 1998 costs and
    various scope adjustments) to form the basis of EM's portion of the
    fiscal year 1998 environmental liability estimate, which was determined
    to be more than $145 billion. The balance of the Department's fiscal
    year 1998 environmental liability was derived from the 1995 and 1996
    Baseline Environmental Management Report.
        EM presently has cleanup responsibility for a total of 113
    geographic sites. At the end of fiscal year 1997, 60 of the 113
    contaminated sites had been cleaned up. In fiscal year 1998, EM cleaned
    up three geographic sites and transferred another two sites to the
    State for cleanup at its request, which leaves EM with 48 sites
    remaining to be cleaned up. By 2006, EM intends to complete cleanup at
    all but 10 of its 48 remaining sites.
        We are currently in the process of updating the life-cycle cost and
    schedule estimate for cleanup of the EM program. This estimate is being
    updated as part of the Paths to Closure planning process and is
    presently scheduled to be released early this summer. This estimate
    will form the basis for determining EM's portion of the Department's
    fiscal year 1999 environmental liability.
        Question. How does this estimate compare to the previous estimate,
    and what is the reason for the difference? How much money has been
    invested to date in the cleanup effort?
        What are the major factors that have contributed to the reduction
    in the estimated cost of the cleanup effort?
        Answer. In 1995 and 1996, as requested by Congress, the Department
    developed its first estimates of life-cycle cost and schedule for the
    remaining EM cleanup effort. These Baseline Environmental Management
    Reports (BEMRs) described the estimated scope of the EM program. The
    1996 report stated that, as a mid-range estimate, the program would
    cost approximately $230 billion (constant 1996 dollars) spent over a
    70-year period, using certain assumptions about funding levels,
    productivity, and land use in developing the estimate.
        The primary reasons for the difference between BEMR and Paths to
    Closure can be attributed to the fact that BEMR: (1) included costs for
    both ``legacy'' waste associated with historical nuclear weapons
    production and nuclear related activities, and newly generated wastes;
    (2) included costs for the eventual transfer of DOE facilities not
    currently in the Environmental Management program; and (3) in some
    cases, used different end-state assumptions than Paths to Closure.
        Paths to Closure addresses a somewhat different scope. For example,
    Paths to Closure includes costs for legacy waste cleanup but not newly
    generated wastes, and excludes costs for any facilities not currently
    in the Environmental Management program. Additionally, Paths to Closure
    reflects improved estimates for a number of projects and improvements
    in efficiency in accomplishing the same or comparable activities,
    thereby lowering total life-cycle costs of the program. In addition,
    $145 billion representing EM's portion of the fiscal year 1998
    environmental liability statement reflects future estimated costs
    starting in fiscal year 1999, while the 1996 BEMR estimates costs
    beginning in fiscal year 1996.
        Since its inception in 1989 through fiscal year 1999, the
    Environmental Management program has received $52.9 billion in funding.
    This funding covers not only ``cleanup'' but also other EM activities
    (e.g., nonproliferation, waste disposal, spent fuel storage, fissile
    material, security, site infrastructure maintenance). The following
    chart for the record displays this funding by fiscal year. (The
    information follows.)

                                                                                        [In millions of dollars]
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                        Fiscal year
                                                                 -------------------------------------------------------------------------------------------------------------------------   Total
                                                                   1989 \1\   1990 \1\     1991       1992       1993       1994       1995       1996       1997       1998       1999
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    Traditional BA..............................................    1,657.3    2,274.1    3,601.0    4,286.9    5,520.3    6,000.0    5,809.3    6,067.3    5,661.2    5,662.8    5,603.6    52143.8
    Privatization...............................................  .........  .........  .........  .........  .........  .........  .........  .........      330.0      200.0      228.4      758.4
                                                                 -----------------------------------------------------------------------------------------------------------------------------------
          Total, EM.............................................    1,657.3    2,274.1    3,601.0    4,286.9    5,520.3    6,000.0    5,809.3    6,067.3    5,991.2    5,862.8    5,832.0   52902.2
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Reflects funds managed by the newly-created Office of Environmental Management, which were appropriated under DOE programs to support cleanup work. Funds were appropriated to EM-managed
      accounts beginning in fiscal year 1991.

        Question. What annual funding levels are assumed for the defense
    portion of the cleanup effort over the next 5 year planning period? How
    important is funding stability to the success of the program?
        Answer. The Administration's outyear funding profile is dependent
    upon enactment of Social Security, Medicare, and Universal Savings
    Account proposals. The Defense funding for the Environmental Management
    program for fiscal year 2001 through 2004 would be as shown in the
    following table:

                            [In millions of dollars]
    ------------------------------------------------------------------------
                                                  Fiscal year
                                 -------------------------------------------
                                     2001       2002       2003       2004
    ------------------------------------------------------------------------
    Defense Environmental             4,486      4,486      4,486      4,486
     Restoration & Waste Mgmt
     \1\........................
    Defense Facilities Closure..      1,054      1,054      1,054      1,054
                                 -------------------------------------------
          Subtotal..............      5,540      5,540      5,540      5,540
                                 ===========================================
    Defense Privatization.......        671        659        633       594
    ------------------------------------------------------------------------
    \1\ Excludes funding for EH Health Studies.

        In developing the report Accelerating Cleanup: Paths to Closure,
    the Department established annual funding targets for the EM Operations
    Offices consistent with a stabilized $5.75 billion funding level for
    the EM program for the immediate future. This funding level includes
    both defense and non-defense appropriations, but does not include
    funding for the privatization account. In a number of instances, EM
    operations offices developed plans that were based on funding levels
    higher than these targets in order to accomplish accelerated closure,
    risk reduction, and other programmatic goals. The report stated that EM
    would address these funding differences by seeking productivity
    improvements, additional funding, as well as reprioritization of
    activities where necessary. The Department will work with our
    regulators, Congress, the Office of Management and Budget, and our
    stakeholders to address these issues.
        The Department recognizes that under current budgetary constraints
    and realities any increases above the current level of funding--which
    has remained approximately stable for the past several years--are not
    likely. However, funding stability is necessary for EM to develop and
    successfully execute a credible plan that will accomplish our
    regulatory requirements and other commitments in a timely manner,
    assist in keeping our projects on schedule and within budget, and
    ultimately reduce the long-term costs of the program. Depending on the
    level, stable funding could provide predictability and sufficient
    funding to accomplish these objectives.
        Question. An important element in meeting cost projections and
    schedules is early determination of the level to which a site is
    cleaned up--the end land use plan. What level of cleanup is assumed in
    the 2006 Plan? Is the Department assuming a mid-level cleanup or a
    maximum cleanup in the Plan? How can DOE provide a credible estimate of
    how much of the cleanup effort will cost if you do not know to what
    level you are cleaning up a site?
        Answer. The cleanup levels identified in Accelerating Cleanup:
    Paths to Closure were determined on a site- by-site basis. The level of
    cleanup for some EM sites has been agreed to by EPA or State regulators
    in conjunction with EM field office personnel at those sites. The laws
    governing these cleanups require that site-specific factors be
    considered in deciding the level of cleanup. The agreed-to levels at
    these sites are reflected in Paths to Closure.
        However, in most cases, particularly at the large sites where
    closure will not occur for decades, agreement has not yet been reached
    with regulators and stakeholders on the cleanup levels and end states.
    Where sites have not reached final agreement, the DOE field staff
    developed planning-basis end states that are being used solely for
    planning purposes. All end state assumptions used in Paths to Closure
    have been shared with stakeholders and regulators and are acceptable to
    them for planning purposes. At these sites where no final agreement has
    been reached, the appropriate review and consultation will occur before
    cleanup levels can be definitively established.
        In developing the life-cycle estimate of $147 billion as reported
    in the June 1998 Paths to Closure, EM did not assume a consistent level
    of cleanup for all sites. As discussed above, the cleanup level agreed
    to, or currently assumed for each site, is unique to that site. It is
    clear, however, that a maximum, or ``green field'' approach is being
    pursued at few, if any, sites. In fact, very few sites are being
    cleaned up to a level allowing unrestricted use for the entire site;
    consequently, EM is examining what long-term stewardship measures will
    be required after cleanup is completed.
        Given the fact that each EM site will not undergo the same level of
    cleanup, EM developed its life-cycle estimate based on the agreed-to,
    or currently assumed cleanup level for each site. EM believes that this
    is the most meaningful and accurate approach to arriving at a credible
    life-cycle estimate.
        Question. How many sites are there to be cleaned up and how many
    approved site cleanup plans are in place? Provide for the record your
    schedule for having an approved site cleanup plan in place for each
    site or major activity requiring a plan.
        Answer. The Environmental Management (EM) program currently has 48
    geographic sites remaining to be cleaned up. In fiscal year 1998, EM
    completed cleanup at three geographic sites and transferred another two
    to the host State (at its request) for cleanup, bringing the total
    completed to 65 of the 113 sites currently under EM's responsibility.
    In fiscal year 1999 and fiscal year 2000, EM plans to complete cleanup
    at three additional geographic sites each year, leaving 42 sites for
    cleanup in fiscal year 2001 and beyond.
        Cleanup plans and site-specific strategies for all remaining EM
    geographic sites are captured in each site's June 1998 Paths to Closure
    report, and are compiled in the June 1998 national Paths to Closure
    report. We are currently updating this information, with release
    expected this summer; and we intend to update it annually. It is
    important to note that while each site has a cleanup strategy in place,
    not all assumed end-states and cleanup levels have undergone the
    appropriate review needed to ensure agreement between regulators and
    the Department. This is an ongoing process without a set schedule.
    Where sites have not reached final agreement, planning-basis end-states
    have been developed and shared with regulators, and have been found
    acceptable for planning purposes. As part of the Paths to Closure
    planning process, EM will provide the status of where each site is in
    the cleanup process, identifying, for example, whether agreements have
    been reached with regulators.
        Question. Are there any site or activities being delayed or slowed
    due to lack of agreement of the end land use or level of cleanup?
        Answer. The Department is working closely with its regulators and
    stakeholders to reach agreement on the eventual end use for its sites.
    Reaching agreement on the end use generally will facilitate agreement
    on required cleanup levels as well as allow for more expeditious
    cleanup. In most cases, general agreement has been reached on the
    desired future land use and resource uses for Department sites,
    including the time frames in which those land uses should be attained.
    The actual land uses ultimately selected, however, will be a risk
    management decision based on the technical feasibility, costs, and
    implementation risks associated with the specific remedial actions
    carried out to achieve a certain level of cleanup. Although future land
    use is always an important consideration, and substantial time may be
    needed for a final decision on end use or level of cleanup, typically
    there are several interim steps that can be taken to reduce risks that
    do not require a final determination on land use, and therefore
    necessary cleanup can proceed while final land use decisions are still
    being discussed. Consequently, activities at the various Department
    sites are not being delayed due to lack of agreement on the eventual
    end use or the level of cleanup required.
        Question. How much additional savings can be obtained or expected
    if site end use land conditions were known?
        Answer. The Department does not have an estimate of total life-
    cycle costs if ``site end use land conditions were known.'' We believe
    strongly that substantial cost savings are possible if cleanups are
    performed to make land available for reasonably anticipated future end
    uses, rather than seeking to make all sites clean enough for
    unrestricted use everywhere. That is why we have been working closely
    with EPA and state regulators to negotiate cleanup agreements that
    result in cleanup standards that are based on reasonably anticipated
    future land uses. We also worked with EPA and other agencies in
    developing the Administration's recommendations to reform Superfund,
    including a provision that would make it easier to consider future land
    uses in remedy selection. These reforms have not yet been acted upon by
    Congress. Nonetheless, we believe that the administrative reforms
    adopted by EPA and state agencies have allowed us to negotiate remedies
    that adequately consider future land uses.
        The life cycle costs cited in previous responses include the costs
    for these negotiated remedies where substantial savings were attained
    by considering future land uses. In fact, one of the principal findings
    of the 1995 and 1996 Baseline Environmental Management Reports and the
    1998 Accelerating Cleanup: Paths to Closure report was that, at most
    sites, the contamination and waste is not being moved, but is being
    contained in place, resulting in restricted land uses. There may be
    some instances in which cleanup agreements require cleanup to a level
    not justified by expected future land uses, but we are continuing to
    identify those exceptional circumstances, and do not expect significant
    additional savings by renegotiating cleanup agreements to account for
    future land use. As a result, the Department is now developing a
    program to provide adequate long-term stewardship (e.g., monitoring and
    maintenance) of the residual hazards left after cleanup is completed.
    We have not yet completed a technical or cost estimate for this
    program, but expect that it should be relatively insignificant compared
    to the cleanup program.
        It is important to remember that much of the Department's
    Environmental Management program involves stabilizing extremely
    hazardous nuclear materials, and treatment and disposal of radioactive
    wastes. The costs for these elements of the cleanup program will not
    change based on expected land uses.
     comprehensive environmental response, compensation, and liability act
                         (cercla) cleanup at doe sites
        Question. What laws set the standards for cleanup or is DOE self
    regulated and able to establish its own standard through negotiations
    with State, local and other interests?
        Answer. The Comprehensive Environmental Response, Compensation, and
    Liability Act (CERCLA) authorizes EPA to require responsible site
    owners, operators, generators and transporters to clean up releases of
    hazardous substances, including radioactive substances. In 1986, CERCLA
    was amended by the Superfund Amendments and Reauthorization Act. Under
    section 120(a) of CERCLA, as amended, all Federal agencies, including
    DOE, are subject to the same procedural and substantive requirements as
    private parties. In addition, section 120 requires each Federal
    facility listed on the National Priorities List (NPL) to enter into an
    interagency agreement with EPA regarding the cleanup of the facility.
    (States are often included as parties as well.)
        DOE has entered into 17 interagency agreements with EPA and
    affected States for 17 of the 18 DOE facilities listed on the NPL. The
    agreement for the remaining facility is under negotiation, and is
    expected to be executed during fiscal year 1999. These agreements
    integrate the requirements of CERCLA with the applicable requirements
    of other laws and regulations such as the Resource Conservation and
    Recovery Act (RCRA). This is done through a process known as
    ``ARARs''--applicable or relevant and appropriate requirements--wherein
    EPA establishes a process described in CERCLA section 121(d).
    Primarily, ARARs are requirements established under RCRA which States
    have been authorized by EPA to enforce. Although the ARARs process
    allows DOE to discuss cleanup standards with the regulatory
    authorities, the EPA and state environmental regulators are, in effect,
    the final decision-makers for cleanup work because of their regulatory
    approval roles. DOE's role is to comply with schedules negotiated with
    state and federal regulators for conducting studies, proposing
    recommended courses of action, and implementing actions once regulators
    have made decisions. The Department submits an annual report to
    Congress on our CERCLA cleanups, as required by CERCLA section 120. A
    copy of our 1997 report, the most recent available, is enclosed.
                          cost of doe cleanup program
        Question. What will the 2006 Plan cost on an annual basis? What can
    the committee expect to be completed between now and 2006 with the
    funds appropriated?
        Answer. Based on the June 1998 Paths to Closure report, EM
    projected the cost of cleanup at $147 billion, of which $57 billion
    would be spent between 1997 and 2006, in roughly equal annual
    increments, and $90 billion would be spent after 2006. EM anticipates
    that all but 10 sites would be cleaned up by 2006. This includes
    completion of all cleanup activities at Rocky Flats, Fernald, Mound,
    Weldon Spring, Brookhaven National Laboratory, and Battelle Columbus
    Laboratories. In addition, 80 percent of all release sites, that is,
    specific locations or areas where contaminants may have been released
    to the environment, and stabilization of all nuclear materials and
    spent fuel and completion of all preparations for their ultimate
    disposition will have occurred.
        EM is currently in the process of updating the life-cycle cost and
    schedule estimate for cleanup of the EM program. This estimate is being
    updated as part of the Accelerating Cleanup: Paths to Closure planning
    process and is presently scheduled to be released early this summer.
                                accomplishments
        Question. What major accomplishments or activities were completed
    with the funding provided for fiscal year 1998, and what do you expect
    in fiscal year 1999 and fiscal year 2000?
        Answer. The Environmental Management program has produced
    substantial cleanup results at contaminated nuclear facilities and
    anticipates achieving substantial results with the fiscal year 1999
    appropriation and its fiscal year 2000 budget request.
    Fiscal Year 1998 Accomplishments
        With the cleanup of Naturita and Maybell sites in Colorado, we have
    completed surface cleanup of all 22 large uranium mill tailings sites,
    as well as more than 5,300 ``vicinity properties,'' including
    elementary schools and homes. This project included remediation of over
    40 million cubic yards of contaminated soil and material, and
    construction of 19 disposal cells. We are now monitoring low-level
    ground water contamination at some mill tailings sites, with active
    remediation planned at three sites.
        We received certification from the U.S. Environmental Protection
    Agency in May that Waste Isolation Pilot Plant (WIPP) met disposal
    standards, and notification in June from the Defense Nuclear Facilities
    Safety Board that WIPP can be operated safely.
        We completed cleanup of 290 release sites, or local areas where
    hazardous/radioactive releases had occurred, bringing the total number
    of release site cleanups to about 4,100, almost half of our inventory
    of about 9,700 release sites.
        The Department awarded the second part of ``Phase 1'' of a
    ``privatization'' contract, covering the extended design of new
    facilities for the treatment of between 6 percent and 13 percent of the
    high-level waste in tanks by mass at the Hanford Site in Washington.
        We closed a second high-level waste tank at Savannah River Site.
    After removing waste, the tank was backfilled using an innovative grout
    to immobilize residual radioactivity.
        We successfully operated two high-level waste vitrification
    facilities in South Carolina and New York, where last year we converted
    nearly 2,500 cubic meters of waste into 331 canisters of ``glass logs''
    ready for disposal. The first phase of the high-level waste
    vitrification campaign at the West Valley, New York facility was
    completed in fiscal year 1998, under budget and ahead of schedule, and
    we are now vitrifying the tank heels.
        In support of non-proliferation goals, we shipped three shipments
    of spent nuclear fuel from foreign research reactors, bringing the
    total at the end of fiscal year 1998 to eight shipments from fifteen
    countries, including Chile, South Korea, and Colombia. Seven shipments
    have been received at the Savannah River Site in South Carolina and, in
    fiscal year 1998, we completed the first shipment to the Idaho National
    Engineering and Environmental Laboratory.
        We finished connecting community drinking water hookups surrounding
    Brookhaven National Laboratory in New York. We have sponsored more than
    1,500 hookups for off-site residences from fiscal year 1996 through
    fiscal year 1998 to ensure that residents' drinking water supply
    remains unaffected during long-term ground water cleanup.
        To provide for state oversight of our management of low level
    waste, we executed a Joint Federal/State oversight agreement of the
    low-level waste disposal program at the Nevada Test site.
        We disposed of 30,000 cubic meters of low-level waste and 10,000
    cubic meters of mixed low-level waste in fiscal year 1998 alone.
        At Rocky Flats, we stabilized or repackaged about 5,000 kilograms
    of plutonium-bearing residues in fiscal year 1998. In addition, we
    drained acid plutonium liquids from two 2 liquid-piping systems in
    Building 771 and then removed the pipes.
        We completed cleanup of the fourth of eight highly radioactive
    waste storage tanks, called the ``Gunite Tanks,'' at Oak Ridge National
    Laboratory and have started work on the next tank. The cleanup made use
    of several innovative remote access technologies developed through our
    science and technology program (i.e., a robotic arm and vehicle, and a
    waste dislodging and conveyance tool) that provided access to areas of
    tanks which were previously inaccessible.
        EM has verified the first-time use of alternative technologies at a
    site in 108 instances at cleanup projects throughout the DOE complex in
    fiscal year 1998.
        We also began a Technology Deployment Initiative designed to spur
    widespread use of available new technologies. Fourteen competitively
    selected projects were initiated in fiscal year 1998 that resulted in
    13 deployments by the year's end.
        We completed Large Scale Demonstration and Deployment Projects
    (LSDDP) at the Chicago Pile 5 Research Reactor facility at Argonne
    National Laboratory.
        We continue to use pollution prevention techniques to reduce our
    overall costs. In fiscal year 1998 alone, DOE sites completed over 700
    pollution prevention projects, avoiding the generation of 45,000 cubic
    meters and avoiding an estimated $155 million in waste management
    costs.
        We completed deactivation of the N-Reactor complex and the B Plant
    at the Hanford Site, reducing annual surveillance and maintenance costs
    for each of the complex from about $20 million to less than $1 million.
    We also placed C-Reactor at Hanford into safe storage and completed
    deactivation of the ROVER facility at Idaho National Engineering and
    Environmental Laboratory.
    Fiscal Year 1999 Commitments
        On March 26, the Waste Isolation Pilot Plant received the first
    shipment of transuranic waste for disposal. We plan to ship wastes to
    WIPP from Los Alamos, Idaho National Environmental and Engineering
    Laboratory, and Rocky Flats.
        We expect to complete cleanup at Ames Laboratory in Iowa, Sandia
    National Laboratory in California, and Princeton Plasma Physics
    Laboratory in New Jersey.
        At INEEL, the new dry storage facility for spent nuclear fuel was
    completed, and we began transferring Three Mile Island spend nuclear
    fuel from wet storage in the Test Area North-607 pool to the new
    facility.
        We will begin interim stabilization of an additional four high-
    level waste tanks at the Hanford Site.
        We will continue stabilization of ``at-risk'' nuclear materials,
    such as plutonium-bearing materials at Rocky Flats and Savannah River
    and failed or declad spent nuclear fuel, in the H- and F-Canyons.
        We plan to deactivate about 65 facilities, and decommission 80
    facilities.
        We will begin stabilizing plutonium oxide at the Plutonium
    Finishing Plant at Hanford.
        At Rocky Flats, we will drain and remove 12 liquid systems from
    Building 771 and drain 10 areas in Building 371.
        We will complete the removal of spent nuclear fuel from Facility
    7823 on the Oak Ridge Reservation.
        We plan to demonstrate another 22 innovative technologies that meet
    site-identified needs and make another 40 new technologies ready for
    implementation with cost and performance data. We also plan to use new
    technology in at least 60 instances in cleanup activities.
        Another 32 accelerated site technology deployment projects have
    been initiated in fiscal year 1999.
        Environmental Management Science Program grants will be awarded in
    the areas of biological effects of low doses of ionizing radiation and
    subsurface contamination/vadose zone.
    Fiscal Year 2000 Commitments
        We will complete cleanup at 3 sites: Argonne National Laboratory-
    West in Idaho, the General Atomics Site in California, and Battelle
    Columbus Laboratory in Ohio, bringing the number of sites completed to
    71.
        We expect to increase the rate of shipments of transuranic waste to
    the Waste Isolation Pilot Plant to about 14 per week, and will be
    disposing of waste from Rocky Flats, INEEL, the Hanford Site, and the
    Savannah River Site.
        We plan to begin shipments of plutonium metals and oxides from the
    Rocky Flats Plant to the Savannah River Site, two years earlier than
    initially planned, to support accelerated closure of Rocky Flats.
        We will continue our efforts to bring down the ``mortgage'' at
    Rocky Flats by demolishing Building 779 and decommissioning Building
    771.
        At Hanford, we will continue efforts at the K Basins to ensure we
    meet the November 2000 milestone to begin moving spent nuclear fuel
    from the basins to safe storage.
        At Hanford, the extended design phase under the privatization
    contract for treatment of tank waste will conclude in August 2000,
    supporting a decision whether to proceed to construction and operation
    of the treatment facilities.
        At INEEL, we will begin construction of the Advanced Mixed Waste
    Treatment Project facility under a privatization approach.
        We will continue vitrification of high level waste at the Defense
    Waste Processing Facility at the Savannah River Site, and will select
    the technology and begin design work on the alternative to the In-Tank
    Precipitation process to pre-treat certain salt wastes.
        Complex-wide we will deactivate about 60 facilities, and
    decommission 110 facilities, bringing the total number of facilities
    decommissioned to more than 600 out of a total inventory of about 3,300
    facilities.
        We will stabilize about 160 liters of plutonium solutions, 38,000
    kilograms of bulk plutonium residues, and 238 containers of plutonium
    metal/oxides.
        We plan to demonstrate another 30 innovative technologies that
    address site-identified needs and make another 30 new technologies
    ready for implementation with cost and performance data. We also plan
    to use new technology in at least 60 instances in cleanup activities.
        At West Valley in New York, we expect to vitrify 50 cubic meters of
    high-level waste, producing 5 canisters and reducing the inventory of
    waste to 32 cubic meters, and will begin shipments of spent nuclear
    fuel to INEEL.
        In addition, EM has established tangible, quantitative measures
    that track cleanup progress at the sites and establish annual goals for
    performance. These measures, found on page 45 of the Environmental
    Management fiscal year 2000 Budget Request, provide additional
    information on our accomplishments and commitments in fiscal year 1998,
    fiscal year 1999, and fiscal year 2000.
          impact of transferring cleanup program to corps of engineers
        Question. Mr. Owendoff, the committee has watched with interest the
    good work that the Corps of Engineers has been doing with the FUSRAP
    program. What would be the impact of transferring parts or the entire
    cleanup program to the Corps to manage?
        Answer. The Department believes that there would be no benefit to
    transferring additional parts of the Environmental Management (EM)
    program, and that there would be significant downsides to such a
    transfer. The Department also believes the EM program has demonstrated
    considerable success since the Formerly Utilized Sites Remedial Action
    Program (FUSRAP) was transferred to the U.S. Army Corps of Engineers by
    the Energy and Water Appropriations Act of 1998. The Department has
    been working closely with the Corps of Engineers to ensure that the
    transfer of the program was successful and that the impacts on the
    various stakeholders was minimal. I believe the Department's past
    efforts and continued support of FUSRAP have contributed to the current
    progress. In the Memorandum of Understanding between the Corps of
    Engineers and the Department of Energy that was signed on March 17,
    1999, this cooperative effort is formalized so that the program may
    continue to make progress.
        At the time of transfer to the Corps of Engineers, the Department
    was completing cleanup at many FUSRAP sites and, at the remaining
    FUSRAP sites, was shifting its efforts from characterization to
    remediation of these sites and the associated vicinity properties. As
    part of this shift, the larger and more complex sites were ready for
    the start of major remediation efforts. DOE had completed cleanup at 25
    of the 46 FUSRAP sites and significant progress had been achieved at
    the other 21 sites prior to their transfer to the Corps of Engineers. I
    had personally spent a lot of time working with Congressional
    delegations, regulators and communities to agree on cleanup levels and
    schedules to complete cleanup. We had also asked Congress in our fiscal
    year 1998 budget request to significantly increase the funding for
    FUSRAP to support a goal of completing the project quickly. At the time
    of transfer, cleanup decisions were in place. In short, I believe the
    Department had positioned the FUSRAP program to successfully move into
    the implementation phase at the large sites, so that either the Corps
    of Engineers or the Department could have made major progress in the
    last 18 months.
        Considerable effort had been made in characterizing the larger
    FUSRAP sites and providing this information to the regulators and local
    communities. By early 1993, however, agreement had not been reached on
    the cleanup levels at these sites, the condition of the sites when the
    cleanup was completed, and the future ownership of many of the sites.
    In late 1995, the Department decided to take a dramatic step and
    embarked on a two-fold strategy: (1) DOE would get consensus from the
    regulators and communities on the cleanup approach for each site; and
    (2) DOE would request a nearly doubling of the FUSRAP budget with the
    commitment or goal of completing the cleanup in five years. This would
    provide incentives for the regulators and communities to reach
    agreement on achievable cleanup approaches, while providing the Office
    of Management and Budget and the Congress with a commitment to get
    cleanup of the FUSRAP sites completed as soon as possible.
        The Department's task for 1996 was to achieve consensus on as many
    of the large sites as possible to provide justification for the budget
    increase. We knew it would be difficult to complete Records of
    Decisions for the cleanup approach since there was not sufficient
    characterization work done to be able to agree on the extent to which
    soil should be removed. Rather than spend more time and money on
    characterization, we recommended to the regulators and communities that
    we proceed with ``removal actions,'' reaching agreement on what the
    level of cleanup would be depending on the extent of contamination and
    agreed-to land use. Where we had a pile of contaminated dirt which had
    been stockpiled as interim storage from the cleanup of vicinity
    properties, we would remove the contaminated dirt which was above
    specific levels of contamination. We would continue the excavation
    until the contamination level was below acceptable levels. This would
    bring the site to the level appropriate to its agreed-to end use. The
    community and property owner could then re-develop their land as a
    residential or industrial site, or as a public area such as a park. In
    some cases, this would be a couple of feet below the surrounding ground
    level; in other cases, the excavation would be more extensive. Based on
    negotiations with the regulators, communities, and Congressional
    delegations during 1996 and the early part of 1997, we believed we had
    a winning strategy and had received support in achieving consensus on
    the cleanup approach and the associated funding needed to proceed.
        This was the case at the Tonawanda disposal sites in New York, the
    Maywood interim disposal site in New Jersey, the Wayne interim disposal
    site in New Jersey, the St. Louis disposal sites near the airport and
    downtown sites in Missouri, the Middlesex interim disposal site in New
    Jersey, and the Colonie disposal site in New York. The Department had
    developed a contracting strategy at the Wayne site where we
    competitively bid the entire job on a fixed-priced basis for the
    removal and disposal of the contaminated interim disposal site with
    several options for the excavation below grade depending on how much
    contamination we found. Since this approach was successful, we were
    preparing contracts for each of the sites. Additionally, the Department
    was developing alternatives for disposal of the waste generated by the
    FUSRAP program. The Department had negotiated for disposal of some of
    the waste in a Resource Conservation and Recovery Act (RCRA) disposal
    site and was investigating other alternatives as well. Further, we were
    aggressively renegotiating our disposal contracts.
        We had also changed the approach from one of doing cleanups on a
    cost basis, to an integrating contractor who issues a number of
    competitive fixed-price contracts and only conducts cleanups where the
    extent of the contamination is extremely difficult to quantify, such as
    contaminated soil along old haul roads. The integrating contractor had
    project managers and a health and safety staff at each site to ensure
    the conditions of the contract were met, and to provide ready
    availability to the local regulators and community. Thus we had taken
    steps to ensure we were integrating the sites efficiently and
    effectively.
        I believe at the time the Congress transferred responsibility to
    the Corps, DOE had: (1) developed consensus on the cleanup strategy
    with the regulators, communities, and congressional delegations,
    including future land-use designations and cleanup levels; (2) prepared
    a contracting strategy that supported competitive fixed-price
    contracts, which would provide safe and cost-effective cleanups; and
    (3) adjusted the management approach which could focus on cleanups in a
    streamlined and efficient manner. We were pleased with the progress we
    had made from late 1995 to October 1997 in getting the FUSRAP onto a
    fast track for cleanup and removal of contamination from urban areas.
    We also believed that the two-fold strategy we embarked upon in late
    1995 was the right approach and had been proven successful.
        With regard to the transfer of other parts of the EM program to the
    Corps, I believe any such transfers would have very serious impacts on
    cleanup progress for several reasons. First, the other EM sites within
    the Department are not independent, but rather have a strong degree of
    interdependence that extends to all aspects of the Department's ongoing
    missions. Even sites within the Closure Fund account, like Rocky Flats,
    rely on other DOE sites with ongoing missions to accept radioactive
    material, whether for storage, re-use, or disposal. Some of these site
    activities are operated and managed by other non-EM Departmental
    offices, with varied missions that may include energy operations,
    research and development, waste management, or environmental
    restoration efforts. This is significantly different from the single
    focus of FUSRAP. The removal of cleanup portions of this matrix would
    interrupt site management and operations at the multi-program sites.
        By contrast, the nature of the sites in the FUSRAP program has
    enabled the Corps to divide responsibility for the sites among its
    numerous and autonomous districts. Although the FUSRAP sites are
    connected historically, they are not interdependent. The sites were
    managed under a single program by DOE in order to avoid redundancy in
    management, even though geographically they could have been separated
    into site groups and been managed without central coordination.
        Second, the material being handled by the FUSRAP program is also
    significantly lower in radioactivity than much of the material that is
    managed at other DOE sites. The safe management of this highly
    radioactive material depends upon the close coordination of the DOE
    management teams at the various Department sites. It is doubtful the
    Corps, without experience in management of significant quantities and
    levels of radioactive material, would enhance the cleanup mission at
    the sites. On the other hand, placing the Corps in charge of site
    cleanups could disrupt the safety and health functions at the sites.
        Third, the Department believes that it has gained significant
    experience in managing cleanup projects and has been able to accelerate
    the progress being achieved at its sites. Our actions have included
    accelerated characterization, aggressive contracting approaches, and
    incorporation of new technologies that have enabled the Department to
    clean up sites more quickly, more efficiently, and more safely. We
    believe that our successes at one site can be applied to other
    Departmental efforts being carried out across the country and that DOE
    is uniquely positioned to build on these successes.
        For example, a major milestone was achieved in fiscal year 1998 by
    the Department, which significantly contributes to the overall EM
    cleanup mission. All Uranium Mill Tailings Remedial Action (UMTRA)
    Surface Project remediation activities were completed. This brings to a
    close one of the Department's longest running and major environmental
    cleanup programs, which was authorized by Congress in 1978 and cost
    approximately $1.5 billion, including $100 million provided by the
    states involved. Under the UMTRA Surface Project, the Department
    completed remedial actions at 22 of the 24 originally designated sites,
    with two sites being delisted and their responsibility transferred to
    the state of North Dakota. The project involved efforts with 11 States,
    2 Indian tribes, and 23 communities. Cleanup was performed at over
    5,300 vicinity properties located near the 22 designated UMTRA sites,
    and over 40 million cubic yards of material were remediated and
    nineteen long-term disposal cells were constructed. The disposal cells
    must be permanently monitored and maintained. At most of these sites,
    groundwater contamination remains and is being addressed by the UMTRA
    Groundwater Project. The completion of the UMTRA Surface Project marks
    a significant milestone in the Department's efforts to remediate the
    environmental legacy from the production of nuclear weapons. Just as
    mining and milling of uranium was the first step towards the production
    of nuclear weapons, the completion of the UMTRA Surface Project
    represents the first step towards ``closing the circle'' of the
    environmental legacy from nuclear weapons production.
        Overall in fiscal year 1998, EM completed cleanup at five
    geographic sites, bringing the total completed to 65 of the 113 sites
    currently under EM's responsibility. Progress was also demonstrated by
    cleaning up portions of the EM geographic sites, referred to as
    ``release sites,'' and facilities. Cleaning up these areas ultimately
    leads to the completion of the entire geographic site and in fiscal
    year 1998, cleanup was completed at 290 release sites, and 108
    facilities were decommissioned. This brings the total release sites
    completed to 4,124 of the total 9,700 release site inventory, and 448
    facilities decommissioned out of the 3,354 facility inventory.
        We have also been making significant progress at our major sites.
    For example, at the Savannah River Site (SRS) in South Carolina, DOE
    has made significant strides in groundwater and soils remediation over
    the past several years. Of the 500 acres that require remediation,
    nearly 330 acres have been remediated or are in the process of being
    remediated. Of eleven groundwater contamination areas, six have
    remediation systems in operation and over 3,000 million gallons of
    groundwater has been treated. Innovative technology has played an
    important role in acceleration of remediation at SRS and has helped
    drive down costs. For example, passive technologies have reduced costs
    while achieving excellent pollution removal. A total of 12 innovative
    technology deployments in 1998 will further accelerate our remedial
    activities. Unlike FUSRAP sites, significant work remains at the SRS to
    manage the legacy nuclear materials and wastes requiring stabilization
    and disposition. Additionally, the SRS will be assisting other DOE
    sites, including the Rocky Flats site in Colorado, by accepting certain
    excess nuclear materials. Key to these activities is the complex
    operations in the H and F Canyon processing facilities and the Defense
    Waste Processing Facility. These large facilities require specialized
    management experience in nuclear safety programs, including radiation
    safety and criticality control. DOE has more relevant and significant
    experience in these areas and is better positioned than the Corps to
    assure oversight in these key areas. DOE also has the requisite
    experience to ensure that the waste tank farm operations are conducted
    in a manner that fully supports the waste processing needs of the
    Canyon facilities.
        The Department also is actively engaged in a program to assure the
    return of highly enriched uranium from foreign research reactors in
    support of U.S. nonproliferation efforts. Program management activities
    require extensive exchange with the Department of State, interface and
    technical assistance to foreign research reactor owners, outreach with
    affected States and receipt, transport and storage of spent nuclear
    research reactors fuels at Savannah River and Idaho. Again, the
    Department has significant and relevant experience in these complex
    program areas.
        The Department must manage its facilities in an integrated fashion
    to accelerate cleanup, and more rapidly reduce large mortgage costs at
    its sites. This integration is typified by the current plans to
    accelerate the closure of the Rocky Flats site. The SRS is preparing to
    receive surplus plutonium from Rocky Flats at an accelerated pace by
    modifying the K Area Reactor to permit storage of the Rocky Flats
    plutonium two years earlier than previously planned. This action will
    help support accelerated Rocky Flats closure by fiscal year 2006, with
    an estimated life cycle cost savings of approximately $1.3 billion.
    Significant program integration efforts involving EM Headquarters, the
    Rocky Flats site, Savannah River, the Hanford Site, the DOE Office of
    Fissile Materials Disposition and other contractor and national
    laboratory participants was necessary for providing the needed support.
    In our view, the Department is better able to effectively manage these
    integration efforts because of our extensive experience. In short, the
    programmatic challenges faced at Savannah River require the unique
    experience of the Department for effective, successful management.
        At Rocky Flats, we are aggressively working to accelerate the
    closure of the site, and are developing a revised baseline to achieve
    closure by 2006. Closure of Rocky Flats is absolutely dependent on
    other DOE sites. Waste and material generated during the closure is
    going to a minimum of six other DOE facilities in six states. Material
    from the pits is going to Pantex, highly enriched uranium to Oak Ridge,
    residues to Savannah River, low-level waste to the Nevada Test Site,
    and TRU waste to the Waste Isolation Pilot Plant (WIPP); decisions on
    the disposition of classified parts still categorized as national
    security material are being finalized, with the material likely to go
    to Savannah River Site, the Los Alamos National Laboratory, and/or the
    Lawrence Livermore National Laboratory. Many of these shipments are on-
    going. Some of the material being shipped is actually being stored or
    processed in facilities funded and managed by other DOE programs in
    addition to EM. Extensive coordination among DOE federal staff is
    necessary to ensure schedule, cost, and environmental concerns are
    known and are being resolved to allow the shipments to take place.
        At Oak Ridge, Tennessee, the Department has made significant
    progress in the remediation of the first gaseous diffusion plant at the
    K-25 site. This site, now known as the East Tennessee Technology Park
    (ETTP), is a good example of how the Department is working closely with
    the private sector to accelerate cleanup and returning property and
    buildings to productive use. The Department's innovative approach to
    reindustrialization of the site has attracted 20 companies and over 650
    jobs, and has resulted in considerable savings to the government. Major
    remediation projects such as the removal of contaminated sludge from
    highly radioactive storage tanks, called the ``Gunite Tanks'' at Oak
    Ridge National Laboratory and the removal of radioactive deposits from
    old process buildings have reduced the risk of criticality as well as
    health and safety risk to workers and have been completed ahead of
    schedule.
        The Toxic Substance Control Act (TSCA) Incinerator, located at the
    ETTP, is a unique resource used by other DOE programs and sites. This
    facility treats radioactive, TSCA, and RCRA hazardous wastes from
    numerous facilities, allowing them to maintain compliance with their
    Site Treatment Plans required by the Federal Facility Compliance Act.
    The Filter Test Facility (FTF), also located at ETTP, is another
    facility operated by EM that provides a complex-wide service to other
    DOE programs. The FTF tests High Energy Particulate Air Filters that
    are used throughout the complex and are essential to worker safety and
    controlling releases of radioactive constituents. This facility is the
    only one within the DOE complex serving this function. In addition, EM
    has awarded the Broad Spectrum Waste Treatment Contract at Oak Ridge to
    effectively treat mixed hazardous and radioactive wastes to meet
    compliance schedules established by the Site Treatment Plans at other
    DOE sites as well as at Oak Ridge.
        EM has also made considerable progress at Oak Ridge in several
    other areas. Cleanup of Gunite Tanks is well underway using robotic
    technologies, developed by EM's Office of Science and Technology (OST),
    to empty the tanks of the transuranic contaminated sludges. This
    project is attacking problems similar to the tank waste project at
    Hanford, and lessons learned from Oak Ridge activities will be utilized
    at Hanford. Technologies developed by OST at other sites have also been
    instrumental in mitigating releases of contaminants to ground and
    surface waters at the Oak Ridge Reservation, and at the Paducah,
    Kentucky and Portsmouth, Ohio sites. In addition, EM is addressing a
    highly complex problem with the decommissioning of the Molten Salt
    Reactor Experiment at ORNL. EM is in the process of purging radioactive
    gases from the system and is about to tackle the removal of Uranium
    deposits that have migrated into the project's filter system. This is a
    highly complex operation with high levels of radioactive material, and
    EM is drawing on the expertise of DOE's National Laboratories to solve
    the problem. Another technically difficult problem at Oak Ridge is the
    treatment and packaging of TRU waste for eventual disposal at WIPP. Oak
    Ridge currently has most of the DOE complex's remote-handled TRU, as
    well as large amounts of contact-handled transuranic waste in storage
    and has recently issued a fixed price contract to prepare this material
    for shipment to WIPP.
        EM is also a partner with DOE's Office of Nuclear Energy in dealing
    with the United States Enrichment Corporation (USEC) at the Paducah and
    Portsmouth Gaseous Diffusion Plants in Kentucky and Ohio. DOE provides
    landlord services to USEC and obtains services from USEC's operating
    contractor, Lockheed Martin Uranium Services, for maintenance and other
    EM tasks. In addition, if USEC shuts down either of these plants, it
    will be transferred to DOE and become part of EM's responsibilities.
    Funds for this activity have been specifically earmarked by Congress in
    the Uranium Enrichment Decontamination and Decommissioning Fund managed
    by the Department's Oak Ridge Operations Office. Certain United States
    nuclear utilities contribute to this fund based on past operations.
        At the Weldon Spring, Missouri site, the Department is on track to
    complete a complex remediation effort which involves decontamination
    and demolition of dozens of contaminated structures, treatment of
    millions of gallons of contaminated waste waters, hundreds of thousands
    of cubic meters of sludge waste, removal and disposition of hundreds of
    thousands of cubic meters of contaminated soils, and construction of an
    on-site disposal facility that will close one of the first DOE
    complexes used in the development of our nation's nuclear weapons
    program. Working with the site contractor and with the cooperation of
    stakeholders, DOE has been able to reach its remediation goals at
    Weldon Springs within the cost and schedule objectives as originally
    planned.
        At the Fernald, Ohio site, the Department has been working to
    accelerate the cleanup by closely coordinating our plans with the
    regulators and the community. Again, dozens of structures are being
    decontaminated and removed, and the land is being remediated so that it
    can be returned to public use. Our cooperative approach with the
    stakeholders and regulators will enable the Department to close this
    site and return it to public use decades ahead of the original
    schedule.
        At Idaho, DOE has made major strides in meeting the Idaho
    Settlement Agreement commitments for placement of spent nuclear fuel
    (SNF) in dry storage. The new dry storage facility was ready to receive
    its first shipment of SNF in December 1998, and the first transfer of
    Three Mile Island SNF was loaded into the facility in March 1999. In
    January 1999, DOE issued a Request for Proposal for a SNF privatization
    storage project which, when awarded late this year, will be a critical
    facility for providing dry storage capacity for additional SNF at
    Idaho. In addition, DOE will complete moving at-risk SNF from wet
    storage in the CPP-603 facility to safe storage by December 2000. Idaho
    is and will continue to receive and store both domestic and foreign
    research reactor fuel. The success of safely managing the highly
    radioactive SNF has been due to the experienced and highly qualified
    DOE staff at Idaho and Headquarters, and an established working
    relationship with the Nuclear Regulatory Commission and the State of
    Idaho. Idaho also manages the National Spent Nuclear Fuel Program and
    integrates all SNF management and disposition activities across the DOE
    complex, including coordination with the DOE Office of Civilian
    Radioactive Waste Management, which is responsible for ultimate
    disposal.
        The inter-dependence between DOE sites is especially evident at
    Idaho, which depends on other DOE sites, including Argonne National
    Laboratory-West for examination of spent nuclear fuel, Yucca Mountain
    for receipt of high-level waste and spent fuel, the WIPP site for
    receipt of transuranic waste, and the Y-12 Plant in Oak Ridge for
    receipt of highly enriched uranium. Shipments of transuranic waste from
    Idaho to WIPP are being coordinated among EM Headquarters, the Carlsbad
    Area Office, the Idaho Operations Office, and other DOE sites that will
    be shipping to WIPP. Other sites also depend on Idaho, since it
    receives their mixed low-level waste for incineration at Idaho
    facilities.
        At the Hanford, Washington site, the Department faces probably the
    greatest technical challenges as well as the largest inventory of high
    level waste. The cleanup of the K-Basins and the high-level waste tank
    farms are unique missions involving high-level radioactive materials
    which need the specialized expertise the Department has built over many
    years. After about 50 years of producing nuclear materials at Hanford,
    DOE is now cleaning up seriously degraded facilities containing great
    hazards. The background, knowledge, skill and training of the
    contractor and Department personnel are essential to conducting the
    work safely. Many times the experience of the workers and the Federal
    staff are a critical component in determining how to conduct work
    safely in old facilities where existing conditions are uncertain. The
    Defense Nuclear Facilities Safety Board (DNFSB) recognized the critical
    importance of worker qualification and experience in issuing
    Recommendation 93-3 to the Department on this topic, and DOE staff have
    worked diligently over the past six years to reach the DNFSB
    expectations. Furthermore, the DNFSB has issued a number of other
    Hanford-specific recommendations that recognize the difficult challenge
    of characterizing the wastes in the tanks, and highlight safety issues.
    These are topics that demand personnel who are highly specialized and
    trained in the nuclear sciences and engineering--exactly the people
    that the Department and its contractors now have.
        Furthermore, there are many interfaces across the Hanford site
    which led the Department to adopt the Management and Integrating
    contractor concept. We are now realizing the benefits of this
    arrangement through greater cooperation among on-site organizations,
    resulting in improved performance, cost savings and enhanced cleanup
    accomplishments. For example, the groundwater and vadose zone studies
    in the tank areas and in the other parts of the Hanford site are being
    integrated to develop a site-wide picture of subsurface water
    movements. Similarly, integration of work by the various contractors is
    being accomplished through a systems engineering approach, governed by
    Interface Control Documents. This effort is part of DNFSB
    Recommendation 92-4. The integration of the numerous programs and
    contractors enables DOE to manage the whole site, putting limited
    resources on the most important work yet taking into consideration the
    concerns of stakeholders. The Department views the path to success as
    more integration; sharing cleanup with another Federal agency would
    limit the opportunities for integration.
        Progress in 1998 at Hanford included completion of the B-Plant
    deactivation, four years ahead of schedule and at a savings of $100
    million. Annual facility costs have been reduced from $20 million to
    less than $1 million. DOE and its contractors used innovative
    techniques to accelerate the project, including reengineering the
    organization to make it more efficient, forming dedicated project teams
    and using lessons learned from the successful early closure of the
    PUREX Plant. The continuation of expertise from key Federal staff
    involved in the PUREX project played a vital role in the success of the
    B-Plant project. The N-Reactor deactivation project was also completed
    in fiscal year 1998, placing the N-Reactor in a low-cost surveillance
    and maintenance mode pending final disposition. This project included
    the deactivation of 86 facilities, removal of 4,774 cubic feet of
    sediment and 1,140,000 gallons of water, and 350 pounds of fuel from
    the fuel basin. The N-Reactor deactivation project cost $120 million
    over a 6-year period, and resulted in the N-Reactor being placed in a
    safe and stable condition with an annual surveillance and maintenance
    cost of only $350 thousand.
        In light of all the progress EM is making, the Department does not
    believe additional transfers to the Army Corps of Engineers would
    provide any significant benefit. The FUSRAP program was the most
    straightforward of the DOE's cleanup programs. With the exception of
    the wastes stored at the Niagara Falls Storage Site, this program
    involved material with some of the lowest concentrations of any
    material managed by DOE. The inter-site and intra-Department
    integration of radioactive materials at the other DOE sites being
    remediated would be disrupted by other possible transfers of
    responsibilities. The regulatory and safety issues involved with the
    remediation of DOE sites could quickly lead to complications if
    responsibility for cleaning up these sites were transferred to the
    Corps, due to the fact that these other sites generally are
    contaminated with material of significantly greater radioactivity
    levels than the FUSRAP sites, which in many cases cannot be disposed of
    at any facility other than a DOE site under DOE control. Likewise, a
    number of sites contain special nuclear materials often require
    coordination with and the involvement of other DOE sites. The
    Department has extensive expertise in dealing with these waste
    materials, which the Corps does not have.
        For these reasons, I believe that the consequences of transferring
    any additional portions of the Department's cleanup program to the Army
    Corps of Engineers would be to slow down progress and that any such
    transfer would be detrimental to the sites involved, the communities,
    and the Government as a whole.
                       waste isolation pilot plant (wipp)
        Question. How important is the opening of WIPP to DOE's waste
    disposal strategy?
        Answer. The Waste Isolation Pilot Plant is the cornerstone of the
    Department's national strategy for disposal of transuranic waste.
    Numerous legally-binding Consent Orders and Agreements between the
    Department and States are predicated on the disposal of transuranic
    waste at the Waste Isolation Pilot Plant (WIPP). In addition, WIPP is
    critical to achieving the accelerated closure of sites such as Rocky
    Flats.
        Question. Will DOE begin waste shipments to WIPP this year as
    planned? What is your current schedule to make the first shipment? What
    actions could jeopardize the first shipments at this late date?
        Answer. On March 22, 1999, Judge John Garrett Penn concluded that
    the permanent injunction he issued in 1992 does not prevent the
    shipment of waste to WIPP for disposal, and that WIPP has interim
    status under the Resource Conservation and Recovery Act (RCRA). The
    first shipment of waste from Los Alamos occurred on March 26, 1999. DOE
    made its first shipment of waste from the Idaho National Engineering
    and Environmental Laboratory to WIPP on April 27, 1999, and plans to
    begin shipments from the Rocky Flats Environmental Technology Site in
    June or July 1999. There is still the possibility that private
    plaintiffs or the New Mexico Environment Department will seek to block
    shipments to WIPP from DOE sites outside of New Mexico.
        Question. Mr. Owendoff, you know I have been extremely concerned
    about the State of New Mexico's delay in considering a RCRA permit for
    WIPP. Can you tell me where we stand today with respect to the suit
    before Judge Penn and when you expect the New Mexico Environmental
    Department to issue a permit?
        Answer. I am happy to inform you that on Monday, March 22, Judge
    Penn ruled that WIPP has interim status under RCRA and that DOE could
    ship waste to WIPP. On Wednesday, March 24, eight federal judges in
    three separate courts agreed that WIPP's opening should not be delayed.
    The first shipment of waste from the Los Alamos National Laboratory
    arrived at WIPP at about 3:30 am (MST) on Friday, March 26. Over the
    next several months, DOE plans to send additional shipments to WIPP
    from Los Alamos, Idaho and Rocky Flats based on the judge's decision
    that WIPP has interim status and therefore may accept waste while the
    permitting process is completed.
        We do not expect that the Department will be in a position to ship
    waste to WIPP from these three sites pursuant to a final permit until
    late this year or sometime next year. It appears that the New Mexico
    Environmental Department (NMED) will not issue a final permit until
    October or November 1999, and under New Mexico's regulation, the permit
    would not become effective until thirty days after its issuance. In
    addition, the draft permit requires that NMED approve every site before
    it ships mixed waste to WIPP, and NMED has never provided DOE with any
    indication of its schedule for issuing these approvals for Los Alamos,
    Idaho and Rocky Flats.
        The latest draft of the permit issued by NMED also has provisions
    that would require Westinghouse, DOE's contractor at WIPP, to provide
    financial assurances for closure of the facility despite the fact that
    RCRA exempts the federal government from the requirement for financial
    assurances. Westinghouse estimates that, even if it finds an insurance
    or bonding mechanism for providing such assurances, the cost could be
    somewhere between $2-18 million annually. DOE will have to reimburse
    Westinghouse for this expenditure.
        We are also troubled by statements NMED has made during the permit
    hearing and elsewhere that DOE might be: (1) required to submit a new
    RCRA permit application; (2) prohibited from using Panel 1 after the
    permit is issued; or (3) subject to enforcement actions under RCRA if
    DOE ships waste to WIPP before the State issues the permit. We know of
    no legal basis for these assertions, but NMED has been making them even
    after Judge Penn concluded that WIPP has interim status.
        Question. What would be the impact across DOE if WIPP does not open
    as expected?
        Answer. We are pleased to report that WIPP received its first
    shipment of transuranic waste on March 26. We look forward to operating
    WIPP as the integral part of our environmental cleanup program.
        Question. How many State consent orders and agreements would be
    impacted by a delay in WIPP opening?
        Answer. There are sixteen states which have DOE facilities that
    generate or store transuranic (TRU) waste. All of the facilities in
    these states have ``waste disposition maps'' which identify WIPP as the
    disposal facility. Key among the State consent orders and agreements
    are those for Idaho National Engineering and Environmental Laboratory
    (INEEL) and the Rocky Flats Environmental Technology Site (RFETS) which
    are at the critical point for milestone compliance. Several other DOE
    sites may need to negotiate with their host state on transuranic waste
    alternatives if the final resource Conservation and Recovery Act (RCRA)
    WIPP permit is issued beyond the October-November 1999 time frame.
        At INEEL, DOE met the milestone in the Idaho Settlement Agreement
    when the first shipment of TRU waste left the state on April 27, 1999.
    Under the Agreement/court order, DOE must also meet the following TRU
    waste interim deadlines: ship no fewer than 3,100 cubic meters of TRU
    waste out of Idaho by December 31, 2002; after January 1, 2003, ship
    out of the State a running average of no fewer than 2,000 cubic meters
    of TRU waste per year; and ship an estimated 65,000 cubic meters of TRU
    waste out of the State of Idaho by a target date of December 31, 2015,
    but no later than December 31, 2018. If any of these deadlines are not
    met, the DOE must suspend shipments of DOE spent nuclear fuel and
    foreign research reactor spent fuel to INEEL for storage.
        Under the terms of the Rocky Flats Cleanup Agreement, the
    Department committed to ship 375 drums of TRU waste by the end of
    fiscal year 1998. Because WIPP did not open, DOE renegotiated the
    milestone with the regulators to ship 670 cubic meters of TRU waste
    offsite by the end of fiscal year 1999. An inability to ship TRU waste
    offsite for a prolonged period of time would require construction of a
    storage facility for TRU and mixed TRU waste. In addition, DOE is
    strongly committed to accelerated cleanup of Rocky Flats, and shipments
    of transuranic waste should begin this year to support achievement of
    that goal.
        By making the first shipment from the Los Alamos National
    Laboratory, the Department was able to meet a commitment to the State
    of New Mexico and avoid entering into negotiations to identify
    treatment requirements for the transuranic waste in storage at that
    site.
        Question. If WIPP does not open on time will DOE waste movements
    come to a halt? What alternatives is DOE considering to maintain
    schedules and cost savings tied to opening of WIPP?
        Answer. On Monday, March 22, Judge Penn ruled that WIPP has interim
    status and that there is no reason to delay shipments to WIPP any
    longer. On Wednesday, March 24, eight federal judges in three separate
    courts agreed that WIPP's opening should not be delayed. The first
    shipment of waste from the Los Alamos National Laboratory arrived at
    WIPP on Friday, March 26. DOE also made the first shipment to WIPP from
    the Idaho National Engineering and Environmental Laboratory (INEEL) on
    April 27, 1999. Over the next several months, DOE plans to send
    additional shipments to WIPP from Los Alamos, Idaho and Rocky Flats.
                  los alamos environmental restoration program
        Question. A few months ago, there were new reports of contamination
    of the groundwater aquifer around the Los Alamos Laboratory from high
    explosive residues. Could you explain the problem and what DOE is doing
    to address the issue?
        Answer. The Department has detected high explosives (HE) residues
    in groundwater beneath the southwest edge of the Los Alamos National
    Laboratory (LANL). This contamination was discovered in the
    characterization well R-25 that is currently being constructed at LANL
    Technical Area 16. The contamination comes from past high explosives
    research, development, and testing activities carried out in this area.
    Prior to operations at the Pantex site, HE components for the nation's
    nuclear stockpile were manufactured at the TA-16 area.
        High explosives and chemicals associated with their breakdown were
    present in most of the samples down to a depth of 1,607 feet.
    Concentrations in most groundwater samples above 1,607 feet exceed the
    EPA health advisory guidance for drinking water.
        Groundwater in the TA-16 area is not used for drinking water. The
    closest water supply well is located 3.5 miles east of the R-25 well.
    The groundwater travel time between the R-25 well and the nearest water
    supply well is probably between 50 and 200 years. Samples from the
    nearest six water supply production wells on the LANL property were
    tested and found to contain no high explosive degradation products.
        Steps have already been taken to reduce the discharge of high
    explosives processing water in the TA-16 area. In the early 1990s, LANL
    recognized that high explosives wastewater discharges at TA-16 would
    not meet State stream standards, and began to reduce discharges and
    improve discharge water quality. These changes were completed in
    September 1997 and included a new high explosives wastewater treatment
    plant. In addition, installation of new vacuum pumps at TA-16 high
    explosives processing facilities improved reuse of wastewater and
    reduced flow to the wastewater treatment plant. Other changes
    eliminated 19 of the 21 high explosive wastewater outfalls. Before
    1997, the Laboratory discharged more than 12 million gallons of HE-
    contaminated wastewater a year at TA-16. Since the new treatment plant
    was installed and the wastewater outfalls were eliminated, the
    Laboratory discharges only 120,000 gallons per year, or about 1 percent
    of the amounts previously discharged.
        The R-25 well is the third of 32 planned deep wells that LANL will
    install as part of a seven-year groundwater study. The study,
    documented in the Hydrogeologic Workplan, has been approved by the New
    Mexico Environment Department and is being carried out jointly by the
    Offices of Environmental Management and Defense Programs. The goal is
    to develop better understanding of the geology, groundwater flow, and
    geochemistry beneath the 43 square mile LANL area. The study will also
    assess impacts that prior LANL activities have had on groundwater
    quality in the area.
        The TA-16 area is one of LANL's highest priority cleanup sites.
    Removal of high explosives from contaminated soils near recently
    eliminated wastewater outfalls will begin this year. In particular,
    high explosive contaminated soils in the vicinity of the Building 260
    outfall are scheduled for cleanup this summer. The Department is also
    constructing R-25 as a monitoring well with nine sampling ports
    distributed throughout the upper and lower zones of saturation. Once
    completed, the additional samples will be collected on a periodic basis
    to define the distribution of high explosive concentrations in
    groundwater and to monitor changes in the quality of the groundwater
    over time.
        Question. Are you coordinating your actions with the State of New
    Mexico and do they concur with your actions and plans?
        Answer. The Department and Los Alamos National Laboratory (LANL)
    staff are working closely with regulators in the New Mexico Environment
    Department and Groundwater Bureau to define future planned activities
    as a result of the R-25 findings. State regulators have been briefed on
    the R-25 results throughout the R-25 drilling effort. Results have also
    been discussed with the New Mexico Environment Department at the
    Hydrogeologic Workplan quarterly meeting on February 9, and at a
    meeting with the New Mexico Environment Department and Groundwater
    Bureau held in Santa Fe on March 4.
        LANL staff discussed the R-25 results and future characterization
    plans with State regulators at the March 29-31 Hydrogeologic Workplan
    meeting.
        Question. What are DOE's plans and schedule for installing a new
    regional aquifer to the monitoring well to determine whether
    contaminants have moved away from Technical Area-16?
        Answer. The Department is accelerating the schedule for installing
    a new regional aquifer monitoring well that will be located between the
    characterization well R-25 and the nearest water supply wells as part
    of the Hydrogeologic Workplan. The new well will show whether
    contaminants have moved away from TA-16, and provide information to
    assist LANL efforts to ensure that drinking water supplies are
    protected. Drilling the new well will begin either this year or early
    next year.
        In addition to the regional aquifer well described above, LANL is
    planning additional investigations in the TA-16 area to better
    understand the nature and extent of groundwater contamination
    identified by the R-25 drilling effort. Plans are currently under
    development to determine the size of the contaminant plume that
    contains high explosives components and the direction and velocity of
    groundwater flow. The numbers and locations of any new wells will be
    developed in cooperation with State regulators in the New Mexico
    Environment Department and Groundwater Bureau.
          hanford reprogramming/em program accountability and control
        Question. Now I'd like to talk for a moment about the Hanford Tank
    Operations reprogramming proposal, and the broader, more fundamental
    issue of accountability and control within the Environmental Management
    program.
        First, regarding the reprogramming of $53.3 million for Tank
    Operations at Hanford, I understand that DOE knew as early as May 1998
    that additional ``critical'' work requirements would make it difficult
    to stay within available funding levels. The Department was notified in
    August of 1998 by the M&I contractor that there were increased funding
    needs to address important issues in the tank farm. Yet, there was no
    action taken until mid-February 1999 to alert the committee of a
    potential problem, and it was not until February 24, 1999, that the
    Department formally notified the appropriate Committees of Congress of
    the funding shortfall and the need for the additional $53.3 million.
    This chronology raises serious questions as to how the Department of
    Energy manages its programs and the extent that the Department is able
    to control how appropriated funds are spent.
        Why, based on your own timeline, in May and again in July of 1998
    when additional unscheduled work became known, didn't the Department
    take actions to reorder priorities in an effort to stay within the
    available funding level?
        Answer. In May 1998, although some of the conditions that would
    eventually require this reprogramming were known to exist, the impact
    to fiscal year 1999 planning was not fully apparent. By July, a number
    of events occurred, such as completion of a Process Control Plan for
    tank C-106, the State's notification of its intent to sue related to
    interim stabilization, and a high incidence of reported alarm failures,
    that defined the urgent and emergent safety actions which would need to
    be addressed in fiscal year 1999. However, the full scope, schedule,
    and costs associated with these activities were not defined
    sufficiently to be able to reprioritize work at that time. In
    retrospect, we should have advised the Congress in August 1998 of the
    new requirements and the potential for a reprogramming request. This
    would have provided the Congress the opportunity to decide if the
    fiscal year 1999 appropriation marks should be revised.
        Question. Why in August of 1998 was the committee not informed of
    the additional problems and funding needs as identified by the M&I
    contractor? You'll remember that the Conference on the fiscal year 1999
    Energy and Water Appropriations Bill had not taken place, so the
    committee had the ability and opportunity to address this issue when
    finalizing the fiscal year 1999 Environmental Management budget.
        Answer. While the need was recognized, the information required for
    a formal request was not fully developed. In August 1998, the Richland
    Operations Office was still working on the contractor's multi-year work
    plan. Additionally, the Department was in the midst of negotiations
    with the State of Washington concerning stabilization of the single
    shell-tanks. The full scope of the activities to be required was not
    fully defined at that time. Therefore, the entire scope of the
    additional work was not clearly defined, nor were the associated costs.
    It would have been premature to request Congressional action without
    proper details to support the request. However, in retrospect, had we
    advised the Congress in August 1998 of the new requirement and
    potential for a reprogramming request, it would have provided Congress
    with the opportunity to decide if the fiscal year 1999 appropriation
    marks should be revised.
        Question. Why, knowing of the shortfall in funding, did the
    Department authorize the M&I contractor to proceed with additional work
    prior to notification and approval of a reprogramming by the Committee
    on Appropriations of the House and Senate?
        Answer. The contractor was authorized to proceed to address urgent
    and emergent safety needs, as well as regulatory requirements. At no
    time did Richland intend to exceed available funding limits, or violate
    any fund controls. There had always been a plan in place to reduce
    scope to stay within the limitations. However, this plan involved
    significant impacts to site-wide programs. The need for the
    reprogramming arose because of the requirement for additional operating
    funds in the Post-2006 Completion Fund account. If the reprogramming
    were to be disapproved, all programs under this account (i.e.,
    environmental restoration, waste management, and Tank Waste Remediation
    System/privatization support) would have had to absorb reductions to
    allow the tank safety work to continue.
        Question. Why did it take from August of 1998 until February 1999
    for the Department to get a reprogramming request to the committee?
        Answer. Last summer, the Richland Operations Office identified
    several funding needs in the high level tank waste operations program.
    These needs exceeded the identified potential funding sources.
    Therefore, the Richland Office and Headquarters worked together to
    develop the funding priorities to be included in the reprogramming
    request as well as the potential funding sources.
        During this process, additional funding needs arose as a
    consequence of new technical issues with one tank that has posed
    significant health and safety problems in the past, as well as the new
    consent agreement with the State of Washington to resolve compliance
    issues concerning interim stabilization of the single shell tanks.
        To ensure that these new activities were properly priced and to
    avoid the need to submit two reprogramming requests, the Richland
    Office and Headquarters continued to work together to finalize the
    technical approaches and pricing for these new activities before the
    reprogramming request was submitted to Congress.
        The Richland Office submitted its formal reprogramming request to
    Headquarters on December 10, 1998; Headquarters submitted the request
    to OMB on February 4, 1999; and the Department submitted the final
    request to Congress on February 24, 1999.
        In retrospect, we should have advised Congress in August of 1998 of
    the new requirement and potential for a reprogramming request. This
    would have afforded Congress the opportunity to decide if the fiscal
    year 1999 appropriation marks should be revised or wait for a formal
    reprogramming request.
        Question. Finally, can you explain how or why the Department was
    able to assume approval of the reprogramming in the fiscal year 2000
    budget, which the Department prepared last year and submitted to the
    Congress on February 1, 1999, when the requirements of the
    reprogramming request were not fully known and no request had been
    submitted to the committee?
        Answer. The Department intended to present the Congress with a
    request for fiscal year 2000 that was consistent with the reprogramming
    request that would be presented to the Congress at approximately the
    same time. In this manner, the Department would be presenting to the
    Congress a consistent and coherent description of the program that the
    Department was seeking to execute at the Hanford site in fiscal year
    1999 and fiscal year 2000. With respect to the timing of the fiscal
    year 2000 budget submission, the Richland portion of the fiscal year
    2000 budget request was not finalized until late January 1999, so that
    it would accurately reflect the information contained in the soon-to-
    be-submitted reprogramming request. At no time did the Department
    assume the reprogramming had been approved. If the reprogramming had
    not been approved, we would have modified our request for fiscal year
    2000 accordingly.
        In retrospect, we should have advised the Congress in August 1998
    of the new requirement and potential for a reprogramming request. This
    would have provided the Congress the opportunity to decide if the
    fiscal year 1999 appropriation marks should be revised.
        Question. Secondly, and probably of more concern, is the total lack
    of ability of DOE to control the waste cleanup program, not just at
    Hanford, but throughout the DOE complex. This reprogramming is just one
    illustration of the issues and problems. It is just a symptom of a
    bigger problem namely, that DOE's cleanup efforts are being driven by
    compliance agreements and state threats of legal action irrespective of
    the actions by Congress in appropriating funds for the Environmental
    Management program.
        Mr. Owendoff, would you care to respond?
        Answer. First, I would like to address the concern regarding the
    extent to which the EM program is ``driven'' by cleanup agreements and
    potential state legal actions.
        The EM budget is driven by a number of factors, including:
        (1) the need to mitigate or control risks to human health and the
    environment posed by the Department's unprecedented inventory of
    nuclear and hazardous wastes and materials;
        (2) legal obligations to perform a variety of activities, and the
    national policy to reduce global nuclear proliferation risks; and
        (3) a strategy to invest in certain activities such as accelerating
    project completion dates that can reduce longer-term program costs.
        The Department's legal obligations arise directly from federal and
    state environmental and public health laws and regulations that apply
    to DOE's activities, and from compliance agreements that the Department
    has entered into pursuant to those laws.
        The Department recognizes the importance of both meeting its legal
    obligations and managing a program within the current budgetary
    constraints. In many instances, state and federal regulators have been
    willing to renegotiate compliance milestones in light of emerging
    technical information and budgetary constraints. However, state and
    federal regulators have recently indicated an increasing reluctance to
    continue to do so.
        Many EM projects involve unique and complex technical and
    managerial challenges. These include unique, high-level liquid
    radioactive waste mixtures in leaking underground tanks, corroding
    spent nuclear fuel in wet storage pools, and waste in burial pits
    containing plutonium and other wastes in unknown concentrations and
    locations. In a number of instances, the cost and schedules of these
    projects have proved difficult to accurately define or project in
    advance. However, the Department has taken a number of steps to improve
    its project management to help ensure that projects can be completed on
    schedule and within current budgets. For example, the Department has
    undertaken a major effort to integrate cleanups between sites to take
    advantage of potential economies of scale and to eliminate duplicate
    facilities. Also, pursuant to Congressional direction, the Department
    has created the Office of River Protection to manage the Hanford tank
    program. EM also is creating the Office of Independent Project Reviews
    to monitor and improve management of major projects. We are continuing
    to improve our contracting methods to provide our contractors with the
    right incentives and penalties for good or poor performances.
        I must respectfully disagree with the suggestion that there is a
    ``total lack of ability to control the waste cleanup program.'' The
    Department acknowledges that there have been prominent instances in
    which project cost escalations and/or delays in schedules have led to
    legal issues and budgetary pressures. These projects generally have
    involved the unique technical challenges described above. In these
    cases, the Department has taken steps to improve its management of
    these specific projects as well as other technically challenging
    projects. In fact, the Department has made substantial progress in
    completing cleanup projects. By the end of fiscal year 1999, we expect
    to have completed cleanup or made ``no further action'' determinations
    for nearly half (47 percent) of the approximately 9,300 contaminated
    release sites for which the EM program is responsible. This will result
    in the completion of the active cleanup of 65 of the 113 sites
    originally under the EM program (excluding the FUSRAP sites). We have
    produced 617 canisters of waste vitrified into glass since operations
    began at the Savannah River Site near Aiken, South Carolina, and 237
    canisters at the West Valley Demonstration Project in New York. In
    1998, the Department completed the Uranium Mill Tailings Surface
    Project (cleanup of 22 mill sites and 5,700 vicinity properties); the
    decommissioning of the Hanford-Reactor and B-Plant; the cocooning of
    the Hanford C-Reactor; and the completion of Phase I of the
    vitrification program at West Valley, New York (vitrification of all
    waste except for tank heels.) In addition, the Department is on track
    to complete the closure of the Weldon Spring site by 2002 and the Mound
    site by 2005. We are also on track to complete cleanup at Fernald by
    2006 and continue to refine our project baselines at Rocky Flats in
    order to meet our ambitious goal to clean up Rocky Flats by 2006.
        The Department therefore believes that although there are several
    instances in which project management has been a difficult challenge,
    the program is being managed and we are making the necessary progress.
                             science and technology
        Question. The funding request for fiscal year 2000 for the DOE
    environmental management Science and Technology program is $230.5
    million compared to $243.2 million provided of the current year, a
    reduction of $12.6 million. Within the overall request is funding for
    the Office of Science program which support the efforts of the
    Environmental Management program. This is funded at $47 million in
    fiscal year 1999 and the request for fiscal year 2000 is $32 million, a
    reduction of $15 million from the fiscal year 1999 level.
        Is the continued reduction in the Science and Technology program
    strictly related to budget constraints or is there some other reason
    for the decline?
        Answer. In fiscal year 1999, the Department requested $219.5
    million for the Environmental Management Science and Technology
    program, including $32 million for the Science Program. The Congress
    appropriated $243.5 million for the Science and Technology program,
    including $47 million for the Science program. This represented a $15
    million increase from the request for the Science program and a $14
    million overall increase. The increase provided by Congress in fiscal
    year 1999 for the Science program will enable the Department to
    initiate several new projects in fiscal year 1999 to address scientific
    problems associated with vadose zone, subsurface contamination, and
    groundwater issues at sites such as Hanford and to develop a better
    scientific basis for understanding exposures and risks to humans from
    low dose radiation.
        In fiscal year 2000, the Department is requesting $230.5 million
    for the Science and Technology program, including $32 million for the
    Science program. The requested level for the Science program represents
    the amount that is necessary to continue funding for the projects that
    already have been initiated. The Department intends to assess the
    results from the first round of Science program projects (for which
    fiscal year 1999 is the last year of funding) prior to requesting
    funding for new projects.
        The Science and Technology program budget is developed in
    conjunction with the budget for the other EM sites. The EM budget is
    driven by a number of statutory and regulatory requirements for which
    sufficient funding must be requested. The program's priority is to fund
    these compliance requirements, and other safety-related priorities,
    before it funds other important, but discretionary, items such as
    research that allows the program to address many of the technical
    challenges it faces.
        We are committed to and pleased with the progress of the Science
    and Technology Program, including the Environmental Management Science
    Program, which is co-managed by EM and the Office of Science. We
    continue to believe that a strong Science and Technology Program is
    essential to the success of the EM Program.
        Question. Now several years ago, GAO gave the program poor marks
    for use of funds appropriated for technology development and moving
    that technology into use around the DOE complex. What has DOE done to
    bring about change and to focus the technology development program on
    the areas of critical need?
        Answer. The Environmental Management (EM) program has made
    significant changes in the way our science and technology (S&T) program
    seeks to deploy new technologies. S&T is no longer solely a developer
    of cleanup technologies. S&T now provides the full range of science and
    technology capabilities necessary to deliver and support fully
    developed, deployable solutions to DOE's cleanup problems--from basic
    research through development, demonstration, deployment and technical
    assistance. We have enhanced the ``focus area'' membership--teams that
    address EM's five major problem areas--to serve as centers of expertise
    to provide technical assistance to the sites on technologies through
    all phases of development and deployment. We have also established
    Focus Area User Steering Committees that consist of senior-level user
    and developer representatives who are involved in decisionmaking
    throughout all phases of technology development. This ensures that
    users provide input as technologies evolve so the technologies meet
    sites' needs as they become available for use.
        Also, an EM Research and Development Program Plan has been
    developed that ``maps'' investments in technical solutions to site-
    identified needs. This effort ensures that our science and technology
    activities are planned and managed in an interactive, coordinated and
    participatory relationship with EM cleanup project managers and
    stakeholders.
        S&T uses a multi-attribute decision model that defines and
    prioritizes EM's technology needs and drives investments for science
    and technology. The prioritization criteria help ensure we are meeting
    our highest priority needs to solve environmental cleanup problems, as
    well as addressing areas of high technical risks, addressing high cost
    waste streams, and accelerating deployment.
        To spur widespread use of available innovative technologies, EM
    began an accelerated site technology deployment initiative in fiscal
    year 1998. Fourteen projects were competitively selected and initiated
    that resulted in 13 deployments by the year's end. Another 42
    deployment projects were reviewed and approved for possible funding in
    fiscal year 1999, from which 32 have been funded and initiated. The
    cost and performance data from these successful deployments help
    accelerate widespread use by eliminating the perceived business risks
    associated with new technology.
        S&T also helps sponsor the Interstate Technology and Regulatory
    Cooperation Working Group (ITRC), a state and federal partnership for
    streamlining the regulatory approval process. ITRC provides an
    excellent forum for regulators from 26 states to collaborate with
    representatives from federal agencies, industry and stakeholder groups
    to raise the confidence of environmental decision-makers concerning
    deploying new technologies. This collaboration among participating
    states eliminates duplicative verification work, thereby reducing the
    time and cost regulating agencies must spend reviewing and permitting
    new technologies.
        Question. Can you give the committee some idea of how you have been
    able to develop and move technology from the concept stage to use at
    DOE sites?
        Answer. An example of a viable technology that grew from an idea is
    cesium removal using crystalline silicotitanate (CST). Approximately
    100 million gallons of radioactive waste are stored in underground
    storage tanks at Hanford, Idaho, Oak Ridge, and Savannah River. The
    waste contains the radioactive element cesium, which emits penetrating
    radiation that presents health risks to workers and the public if they
    are exposed to the tank waste. Removing the cesium from liquid tank
    waste reduces the volume that must be carefully and expensively handled
    to prevent such exposures.
        To address the cesium removal problem, we began a collaboration
    between Texas A&M University and the Sandia National Laboratory (SNL)
    to improve our understanding of the molecular structure of this type of
    waste. This effort showed promise as an improved method for separating
    radionuclides from high level wastes. These early results led to a
    Cooperative Research and Development Agreement between SNL and a
    private company, UOP Molecular Sieves, to produce CSTs in an engineered
    form. Oak Ridge National Laboratory (ORNL) used their ``hot'' cell
    facilities to perform successful pilot-scale testing (one-liter
    samples). The results of the pilot-scale tests enabled scale-up to a
    size suitable for processing Oak Ridge waste, and 25,000 gallons of
    Melton Valley tank waste were successfully treated using a full-scale
    system built by TTI Engineering under contract with ORNL. Going from
    breakthrough to full-scale deployment took about five years and
    involved one university, two National Laboratories, and two companies.
        Question. One of the tools which has been developed is ``technology
    roadmaps''. Explain the concept of these ``roadmaps'', how DOE plans to
    use them, and how the budget request addresses areas where there are
    significant science and technology issues to be addressed?
        Answer. EM has been playing a lead role in the Department-wide
    effort to use roadmapping techniques to improve the way we develop and
    manage science and technology investments. Roadmapping within EM
    involves an interactive dialogue between the user community responsible
    for the cleanup and the science and technology community developing
    solutions. This dialogue results in a jointly defined set of needs and
    an investment strategy to address them. The success of the DOE
    environmental cleanup program will ultimately depend on whether cleanup
    project managers at DOE sites have the tools and information they need
    to complete their projects on time and within budget.
        EM has approached roadmapping at three levels. In November 1998, EM
    issued the EM Research and Development Program Plan. This Plan outlines
    a five-year investment portfolio for science and technology at the
    program level and is based on data provided by the sites to support
    EM's planning processes. The second level of roadmapping is at the
    environmental problem level (i.e., high level waste, mixed waste,
    deactivation and decommissioning, plutonium stabilization, and
    subsurface contamination). We have developed a set of multi-year
    program plans for each of these major problem areas which are reviewed
    by the site users and ultimately endorsed by the Focus Area User
    Steering Committees--groups established to ensure user and developer
    coordination through all phases of technology development. The third
    tier of roadmapping is at the project level and to date has been
    focused on a limited number of projects (e.g., salt treatment
    alternatives for cesium removal at the Savannah River Site and vadose
    zone activities at Hanford). These roadmapping efforts provide the
    underlying basis for the budget request.
        To ensure the requested budget addresses areas where there are
    significant science and technology issues, S&T uses a multi-attribute
    decision model that defines and prioritizes EM's technology needs and
    drives investments for science and technology. The sites across the DOE
    complex recently reported over 500 environmental problems that require
    technological solutions in order to complete cleanup activities, over
    80 percent of which are categorized as medium and high priority. Also
    86 pathways or events on the critical path to closure were identified
    as having medium to high technological risk, where critical cleanup
    projects may not be completed on time or within budget due to a
    technology deficiency. This prioritization process uses these data to
    ensure that S&T's investments are aimed at meeting the highest priority
    needs, addressing areas of high technical risks, addressing highest-
    cost needs, and accelerating deployment.
        Question. How important is the Science Program to the success of
    the environmental management and cleanup program?
        Answer. The Environmental Management Science Program (EMSP), which
    is co-managed by DOE's Offices of Environmental Management (EM) and
    Science (SC), has a significant role in the successful cleanup of the
    DOE weapons complex. The sites have identified a number of significant
    and intractable problems they will face in the long-term, primarily in
    work that needs to be done beyond the 2006 timeframe. The EMSP
    addresses the most challenging, and potentially the most costly,
    technical problems facing DOE related to high-level waste, spent
    nuclear fuel, mixed waste, nuclear materials, remedial action,
    decontamination and decommissioning, and health, ecology and risk.
        Question. Is the $32 million funding level sufficient to carry out
    a credible program? Please explain.
        Answer. We are confident that the requested $32 million is adequate
    to continue the multi-year grants that were awarded in previous years.
    This includes the last year of 66 three-year research projects
    initiated in fiscal year 1997, 33 three-year projects initiated in
    fiscal year 1998 in the areas of radioactive tank waste and
    decontamination and decommissioning, and fiscal year 1999 grants to be
    awarded in September 1999 to address subsurface contamination/vadose
    zone and effects of low dose radiation exposure.
        Question. What, in your judgement, is the minimum credible annual
    funding level?
        Answer. At this time, we believe $32 million is the minimum level
    at which the EMSP program can adequately conduct a research program
    that provides basic scientific knowledge in support of the development
    of ``cutting-edge'' environmental technologies. The requested level for
    the Science program represents the amount necessary to continue funding
    for the projects that already have been initiated. The Department
    intends to assess the results from the first round of Science program
    projects (for which fiscal year 1999 is the last year of funding) prior
    to requesting funding for new projects.
        Question. Can you give the committee some of the accomplishments to
    date as a result of the funding provided for the Science Program?
        Answer. We are pleased with the progress of the Environmental
    Management Science Program (EMSP), which is co-managed by the DOE
    Offices of Environmental Management (EM) and Science. Since its
    beginning in fiscal year 1996 through fiscal year 1999, EMSP has
    invested over $190 million to support 235 research projects--work that
    is already providing useful results. Some selected accomplishments are:
      --We are genetically engineering a natural soil bacterium with high
            resistance to radiation into a natural detoxifier for complex
            mixed wastes. These results show the promise of yielding an
            inexpensive, effective bioremediation of contaminated sites.
      --We have also demonstrated innovative metal contaminant remediation
            methods using tobacco plants (phytoremediation) to remove
            methyl mercury from soils.
      --We now have a better understanding of gas bubble-tank waste
            interactions during barometric pressure changes, which can lead
            to better methods of measuring and monitoring dangerous gas
            formation in high-level waste tanks and process streams.
      --We are developing a method that combines seismic reflection and
            ground-penetrating radar to better map near-surface (2 to 8
            meters) conditions at waste sites. This non-invasive approach
            can facilitate retrieval of buried waste at sites with complex
            geologies.
        At the end of fiscal year 1999, we expect final reports from over
    100 of the research projects awarded in fiscal year 1996, and we expect
    to have many scientific results that will help EM in achieving its
    cleanup mission.
        Question. Has the Department decided whether there is no longer a
    need for a stable Science Program as reflected in the budget request
    for fiscal year 2000?
        Answer. We believe the requested $32 million is appropriate at this
    time to support the multi-year grants that were awarded in previous
    years.
                              rocky flats cleanup
        Question. Last year the Congress funded the cleanup work at Rocky
    Flats in the Closure Account at $657 million. The budget request for
    fiscal year 2000 is level funded at $657 million. The committee has
    been funding the Rocky Flats cleanup effort based on an accelerated
    schedule with closure by 2006. The current plan on which Rocky Flats
    cleanup costs and schedules are based on project closure of the site by
    2010 at a cost of $7.3 billion. DOE's Accelerating Cleanup: Paths to
    Closure also indicates that cleanup will not be completed by the year
    2010.
        Accelerated cleanup of Rocky Flats is a key to DOE's efforts to
    reduce landlord and mortgage costs thereby freeing up resources to be
    applied to other critical cleanup work and sites. If Rocky Flats is not
    accelerated and the resulting savings of an estimated $1.3 billion
    realized, then there will be insufficient funds available to accomplish
    work at other sites across the DOE complex.
        Explain DOE's strategy and approach to cleaning up Rocky Flats. Why
    doesn't DOE's report on Pathways to Closure support closure by 2006?
        Answer. The Department fully supports efforts to clean up and close
    Rocky Flats as soon as possible, including meeting the 2006 goal. The
    strategy for cleanup and closure of Rocky Flats is straightforward, but
    challenging. The nuclear material in the buildings at Rocky Flats needs
    to be stabilized, packaged and sent off-site to a disposition facility
    or for storage in preparation for disposition. Once the materials are
    removed, the buildings will be deactivated and torn down. Waste
    generated by all these activities will also be sent off-site to a
    disposal facility. The soil will then be cleaned up to the agreed-upon
    soil action level and some areas will then be capped. The existing
    baseline and the Accelerating Cleanup: Paths to Closure document show
    this work being completed in 2010. The Department and the Rocky Flats
    contractors have accepted a challenge to accelerate that goal to 2006.
    This goal has not yet been translated into a detailed baseline and
    assumptions necessary to give us confidence that this goal can be
    turned into a plan, but we expect to receive a detailed baseline to
    achieve the 2006 goal from the contractor in May 1999. We plan to
    validate that baseline by the end of this year. Following this, we
    expect that future revisions of Accelerating Cleanup: Paths to Closure
    will reflect the 2006 goal.
                          funding for 2006 completion
        Question. Does the fiscal year 2000 request of $657 million support
    the 2006 date, and if not, why? How much additional funding is needed
    to maintain the 2006 completion schedule?
        Answer. The fiscal year 2000 budget request is based on the current
    baseline for Rocky Flats, which has a 2010 closure date. However,
    activities have already been identified that would help accelerate
    closure to 2006, and these activities are included in the fiscal year
    2000 budget request. Some examples include the ongoing shipment of
    plutonium residues to the Savannah River Site (SRS) for stabilization,
    and accelerating by two years the shipment of metals and oxides to SRS.
    We are expecting the details of a 2006 closure baseline from the
    contractor in May 1999. DOE expects to validate the baseline by the end
    of this year. I am confident at this point that the Department's fiscal
    year 2000 budget request includes adequate funds to support accelerated
    closure.
                                  wipp opening
        Question. How important is the opening of the WIPP facility in New
    Mexico to the Rocky Flats accelerated cleanup strategy. What impact
    will a delayed opening of WIPP have on cleanup plan for Rocky Flats?
        Answer. Opening WIPP is extremely important to the overall effort
    to accelerate the closure of Rocky Flats and several other DOE sites.
    We are very pleased that WIPP has begun receiving waste and expect this
    will help clean up and close Rocky Flats. Nonetheless, more on-site
    storage for TRU waste may be needed. The repackaging of plutonium
    residues in fiscal year 1999, when combined with existing and projected
    TRU waste in inventory at Rocky Flats, may result in more TRU waste
    than can currently be stored at Rocky Flats even assuming shipments of
    waste from Rocky Flats to WIPP. Therefore, even after WIPP begins
    receiving Rocky Flats waste this summer, more storage capacity may be
    needed. Rocky Flats is already increasing its storage capacity by
    modifying existing temporary structures and expanding Building 440. If
    Rocky Flats does not begin shipments of waste to WIPP by July 1999, and
    is not able to ship at fairly aggressive rates, the site will need to
    make a decision by the end of fiscal year 1999 on whether to start
    modification or construction of additional storage facilities. We do
    not expect the need for additional storage to impact the 2006 closure
    goal.
                                 cleanup budget
        Question. What portion of the $657 million budget request is for
    actual cleanup work and how much goes to other expenses such as
    landlord and management costs?
        Answer. Approximately $245 million (37 percent) of the $657 million
    fiscal year 2000 request is for actual cleanup work, including
    stabilization, packaging, and shipment of special nuclear material,
    storage and shipment of waste, deactivation and decommissioning of
    facilities, and environmental restoration activities. The remaining
    $412 million (63 percent) (commonly referred to as fixed cost) supports
    safeguards and security, surveillance and maintenance of over 600
    facilities, infrastructure and utilities, analytical support, and
    project/program management. The desire to reduce the high ``fixed
    cost'' at Rocky Flats is one of the key reasons that the Department is
    investing cleanup dollars for accelerated closure of the site.
                      mixed low-level and low-level wastes
        Question. What are DOE's plans regarding disposal of mixed low-
    level and low-level wastes? Do you have an approved plan, where is the
    waste to go, what is the schedule for having plans approved, and what
    are the major issues or problems associated with providing a path for
    disposal of these wastes?
        Answer. Low-level waste is currently being shipped to the Nevada
    Test Site for disposal. Some mixed low-level waste is currently sent to
    a commercial facility. The wastes now being shipped generally have a
    low radionuclide content.
        Some mixed low-level wastes that will be generated during cleanup
    do not now have an approved disposal pathway. These mixed low-level
    wastes are projected to have radionuclide levels greater than any
    commercial facility is currently authorized to accept; and no DOE
    facility can accept off-site mixed low-level waste, regardless of
    radionuclide content, until DOE issues the Record of Decision for mixed
    low-level waste based on the Waste Management Programmatic
    Environmental Impact Statement. We are pursuing two potential
    disposition paths for this higher radionuclide waste--disposal in a
    commercial facility in Colorado or disposal in a DOE facility. A
    decision on these options is expected in fiscal year 2000.
             idaho national engineering & environmental laboratory
        Question. Briefly explain the strategy and major milestones for
    waste management activities at the Idaho National Engineering and
    Environmental Laboratory (INEEL).
        Answer. The INEEL Waste Management program will safely treat,
    store, and dispose of low-level waste, mixed low-level waste,
    transuranic waste, and high-level waste in compliance with agreements
    (e.g., the 1995 Settlement Agreement among the Department, the State of
    Idaho, and the U.S. Navy), the Federal Facility Compliance Act Site
    Treatment Plan, and other applicable environmental requirements.
        The Department's strategy is to dispose of 6,500 cubic meters of
    stored low-level waste by the end of fiscal year 1999, to treat and
    dispose of backlogged mixed low-level waste (as defined in the Site
    Treatment Plan) by 2003, and to treat and dispose of the retrievably
    stored transuranic waste by 2018. Newly generated low-level, and mixed
    low-level waste will be dispositioned within one year of generation.
    High level waste will be treated and prepared for transport out of
    Idaho by 2035.
        Question. What impact is there on the Idaho Settlement Agreement if
    the WIPP facility does not begin receiving waste this year as planned?
    What alternate or backup plan is there to ensure that the requirements
    of the Settlement Agreement are met?
        Answer. The remedy for failure of DOE to meet the transuranic waste
    shipment milestones outlined in the Idaho Settlement Agreement is the
    suspension of DOE spent nuclear fuel and foreign research reactor
    shipments to the Idaho National Environmental and Engineering
    Laboratory (INEEL). DOE met the first milestone when the first shipment
    left INEEL on April 27, 1999.
        Question. Is there anything other than opening of WIPP which could
    delay shipments of TRU waste out of INEEL in fiscal year 1999?
        Answer. DOE shipped the first shipment of transuranic waste from
    INEEL on April 27, 1999, to the Waste Isolation Pilot Plant in New
    Mexico. Over the next several months, DOE plans to send transuranic
    waste shipments to WIPP from Los Alamos, INEEL, and Rocky Flats.
                 advanced mixed waste treatment project (amwtp)
        Question. The fiscal year 2000 Budget Request includes $110 million
    for the Advanced Mixed Waste Treatment Project at the Idaho National
    Engineering and Environmental Laboratory. This project is being carried
    out under the DOE Environmental Management Privatization program.
        Update the Committee on the current status of the Advanced Mixed
    Waste Treatment Project. Is construction of this facility required
    under the Idaho Settlement Agreement?
        Answer. The AMWTP has been proceeding very successfully since the
    contract was awarded in December 1996. The contractor, BNFL Inc., has
    submitted quality Phase I project deliverables on schedule. Examples of
    such deliverables include the DOE Environment, Safety, and Health
    Program Operating Plan; the Resource Conservation and Recovery Act
    permit application; Air Permit to Construct application; and the Toxic
    Substances Control Act permit application. The AMWTP Final
    Environmental Impact Statement was completed and distributed in
    February 1999, and the DOE Record of Decision was signed by the Acting
    Assistant Secretary for Environmental Management on March 22, 1999. In
    the Record of Decision, DOE decided to implement the EIS Preferred
    Alternative, which is to proceed with construction (Phase II) and
    operation (Phase III) of the AMWTP facility, in accordance with the
    Department's contract with BNFL Inc.
        The project is still in Phase I. BNFL is in the process of securing
    the necessary permits and completing needed safety and health documents
    to obtain DOE authorization to proceed. BNFL will begin construction
    after regulator approval is received. The regulators have indicated
    they expect to issue the permit by the end of this year.
        Completing construction of a facility by December 31, 2002, to
    treat INEEL transuranic and alpha-emitting mixed low-level waste is a
    specific requirement of the 1995 Settlement Agreement between the State
    of Idaho, DOE, and the Navy. The AMWTP is on track for meeting this
    construction milestone. Construction of a facility to treat these
    wastes is also required by the INEEL Site Treatment Plan pursuant to
    the Federal Facility Compliance Act, which is enforceable by the State.
        Question. How will the budget of $110 million be used?
        Answer. The $110 million in privatization program funds in the
    fiscal year 2000 Congressional Budget Request will be available, if
    necessary, to cover the costs incurred by the contractor during the
    construction phase (Phase II) of the project if the Government decides
    to terminate the contract for its convenience. When the facility
    becomes operational in 2003, the $110 million will be available to pay
    the contractor for the amortized capital facility costs over the first
    25,000 cubic meters of treated waste, as required by the contract.
        Question. What is the facility expected to cost? How long is the
    facility expected to operate and at what cost?
        Answer. There are two components of the unit price for treated
    waste: an operating cost component and a capital amortization
    component. The privatization funding pays for the capital amortization
    component and the site's operating budget pays for the operating cost
    component.
        The privatization portion of the total project cost is $569.4
    million, which includes the capital facility financing portion of the
    contractor's price, profit, and the cost of financing (i.e., interest).
    The facility is expected to operate until 2015 to complete the
    treatment of 65,000 cubic meters of INEEL waste under Option 1 of the
    contract, at a cost of $546 million, which includes the M&O Contractor
    and other project support costs, as well as decontamination and
    decommissioning costs. Therefore, the total project cost is $1,115.4
    million. If DOE executes Option 2 of the contract, the AMWTP could also
    treat up to 120,000 cubic meters of additional, similar waste from
    INEEL or other DOE sites at a cost (in operating dollars) of $2,596 per
    cubic meter. In this case, the facility could treat up to a total of
    185,000 cubic meters of waste and would operate for its full expected
    design life of 30 years.
        Question. Why has the total project cost been revised from $1.078
    billion to $1.115 billion? I thought that using the privatization
    approach was an effort to control project schedules and costs?
        Answer. The capital portion of the privatization contract is fixed
    and is not subject to either price redetermination or economic price
    adjustment. There has been an adjustment to the facility operating
    costs due to two factors. First, the contract was negotiated with an
    assumed, level production schedule. An updated production schedule has
    been developed and incorporated into the contract which reflects a more
    realistic waste processing schedule having less throughput during the
    early facility startup phase. This adjustment totaled $7.8 million.
        Second, escalation rates in the initial forecast were based on
    rates established by the Office of Management and Budget. However, the
    negotiated contract requires use of a Department of Labor index as the
    basis for change in economic price adjustment. This contract
    requirement resulted in an adjustment to the estimated life cycle cost
    of $28.7 million. It can be expected that downward or upward changes to
    unit prices will occur when the index forecast changes materially.
    Future budget submissions will stay constant unless there is a
    significant increase or decrease in the index. The economic price
    adjustment clause of the contract does not apply to the privatization
    (capital) part of the contract price; the clause applies only to
    facility operating costs.
        Question. Explain the change in the escalation rates from the OMB
    required rates used in the initial estimates to the economic index
    based escalation negotiated in the Advanced Mixed Waste Treatment
    Project contract which has resulted in an increase of $28.7 million in
    the estimated life cycle cost of the project.
        Answer. Escalation rates in the initial forecast were based on OMB
    rates. However, during negotiation of the contract with BNFL, the
    Department and BNFL negotiated the use of a Department of Labor index
    as the basis for change in economic price adjustment. This contract
    requirement resulted in an increase to the estimated life cycle cost of
    $28.7 million. It can be expected that downward or upward changes to
    unit prices will occur when the index forecast changes materially.
    Future budget requests will reflect significant increases or decreases
    in the index through adjustments to the project estimates. The economic
    price adjustment clause of the contract does not apply to the
    privatization (capital) part of the contract price; the clause applies
    only to facility operating costs.
                                 pit 9 project
        Question. What is the current status of the impasse related to the
    Pit 9 project at INEEL? What can you report regarding the Secretary's
    commitment to find a path forward to resolve the impasse?
        Answer. There are two matters in litigation regarding the default
    termination of the Pit 9 subcontract with Lockheed Martin Advanced
    Environmental Systems (LMAES) for remediation of Pit 9. First, LMAES
    and Lockheed Martin Corporation have commenced an action in the United
    State Court of Federal Claims against the United States. (Cases in that
    court are filed against the United States rather than against an
    individual department or agency.) Second, Lockheed Martin Idaho
    Technologies Company (LMITCO) commenced an action against LMAES and the
    Lockheed Martin Corporation in the United States District Court for the
    District of Idaho, to which the Department is not a party.
        The United States has filed a motion to dismiss the Court of
    Federal Claims action because (1) there exists no privity of contract
    between the United States and LMAES or the Lockheed Martin Corporation
    upon which to base a direct contract action against the United States,
    and (2) no action undertaken by the United States Government has
    effected a cognizable taking of the property of LMAES or the Lockheed
    Martin Corporation. That motion is pending before the Court.
        With respect to the Idaho litigation, we understand that there have
    been discussions between LMITCO and LMAES and the Lockheed Martin
    Corporation. In addition, LMITCO has been exploring with the Department
    various mechanisms that might be available and appropriate to address
    issues raised by the Pit 9 subcontract dispute. Such an undertaking has
    been impeded, however, by the efforts of LMAES and the Lockheed Martin
    Corporation to have the Idaho litigation stayed (that is, consideration
    of its merits delayed) while they pursue their Court of Federal Claims
    action in Washington.
        The Secretary and the Department remain committed to moving ahead
    expeditiously on cleaning up the Radioactive Waste Management Complex,
    including Pit 9. Working with EPA and the State of Idaho, the
    Department has developed and begun to implement an ``alternative'',
    three stage approach to the Pit 9 cleanup. Stage I focuses on
    subsurface exploration. Stage II focuses on design, construction, and
    operation of robotic and remotely operated retrieval systems and
    confinement systems to demonstrate that remedial action Record of
    Decision objectives are achievable. Stage III will complete the
    remediation of Pit 9.
        Question. What is the current cost to finish the project and how
    does this compare to the original baseline estimate?
        Answer. DOE, EPA, and the State have agreed to complete the
    remediation of Pit 9 under a three-stage project for an estimated cost
    of $200 million, which was the fixed price of the original project
    under the now-terminated sub-contract signed in 1994 with LMAES. A more
    detailed cost estimate will be available at the completion of stage 2
    of the project.
        Question. The budget justification indicates that DOE plans to
    spend $50 million for an Alternate Pit 9 phased alternative approach.
    Explain DOE's plans to proceed with a ``Alternate'' approach at Pit 9.
    Doesn't proceeding with this effort make it more complicated and
    difficult in resolving the current legal and contractual dispute?
        Answer. Because the subcontract for the implementation of the Pit 9
    interim action was terminated and the regulatory agencies are requiring
    DOE to meet the terms of the original 1993 Pit 9 Record of Decision,
    the development of a revised schedule and scope of work were necessary
    to satisfy the requirements under the 1991 Federal Facility Agreement
    and Consent Order to issue a Comprehensive Record of Decision for the
    Radioactive Waste Management Complex in 2002. A three-stage process for
    remediating Pit 9 was jointly developed by the DOE, EPA, and the State
    of Idaho, and the schedule for completing the comprehensive
    investigation of the Radioactive Waste Management Complex was extended.
    The revised effort, referred to as the Operable Unit 7-10 Staged
    Interim Action, will include three stages: Stage I focuses on
    subsurface exploration; Stage II focuses on design, construction, and
    operation of robotic and remotely operated retrieval systems and
    confinement systems to demonstrate that remedial action Record of
    Decision objectives are achievable. Stage III will complete the
    remediation of Pit 9.
        The $50 million requested in the fiscal year 2000 Congressional
    Budget Request will be used for CERCLA work on the entire Radioactive
    Waste Management Complex, which includes Pit 9. The Pit 9 portion of
    these funds will be used to complete Stage I, continue work on Stage I
    activities (including monitoring and waste treatability studies), and
    initiate Stage III remediation.
        The decision to proceed with the Staged Interim Action for Pit 9
    described above does not affect the ability of the management and
    operating contractor (Lockheed Martin Idaho Technologies Company, Inc.
    (LMITCO)) to resolve its dispute with Lockheed Martin Advanced Systems,
    Inc. (LMAES).
                                  hanford site
        Question. Explain the overall strategy for cleanup and removal of
    legacy waste from the Hanford Site, particularly as it relates to the
    high level waste tanks and activities associated with the K-Basin.
        Answer. The Hanford Site strategy is to protect the Columbia River
    and to mitigate, to the extent practicable, the greatest hazards by
    2006 while proceeding with the necessary preparations for longer-term
    cleanup. As part of the near-term work, the corroded spent fuel in the
    aging K-Basins is being moved away from the Columbia River into safe,
    dry storage on the central plateau of the 200 Area, where it will
    remain in interim storage awaiting final disposition in a national
    repository. Other near-term actions include completing stabilization of
    plutonium; interim stabilizing the single-shell tanks, some of which
    have leaked, which involves transferring pumpable liquids into double
    shell tanks; and developing a privatized vitrification facility to
    treat and immobilize the high-level wastes in the double shell tanks
    and low-activity wastes at the tank farms. The high-level wastes will
    be placed in an interim storage facility to await final disposition in
    a national repository, and the vitrified low-activity wastes will
    remain in an on-site facility. Transuranic wastes will be shipped to
    the Waste Isolation Pilot Plant beginning in fiscal year 2000, and
    other waste-types will be safely disposed on-site at Hanford.
        The site is remediating contaminated soils, cleaning up facilities
    and buildings through demolition or decontamination, and addressing
    groundwater contamination to reduce risks and reduce surveillance and
    maintenance costs. As agreed to by the regulators, DOE will address the
    decontamination and decommissioning (D&D) of the surplus reactors in
    two phases. Phase I will place the reactors in interim safe storage,
    ensuring that facilities are safe and secure and reducing surveillance
    and maintenance costs. Phase II will involve removal of reactor cores
    to a disposal facility in the 200 area. The overall strategy for
    remediation and D&D activities is to complete cleanup first in areas
    nearest the Columbia River, then move cleanup efforts toward the 200
    area. The majority of contaminated soils and materials will be disposed
    on-site in the Environmental Restoration Disposal Facility in the 200
    area, which has already received over 1.5 million tons of contaminated
    soil.
        Question. How does the Paths to Closure plan support these DOE's
    strategies?
        Answer. The Paths to Closure report focuses on addressing the
    highest risk activities first, along with accelerating project
    completion and site closure. This strategy is reflected in the
    prioritization of activities at the Hanford site, where mitigation of
    the greatest Hanford hazards (e.g., tanks, spent fuel in K-basin, and
    the Plutonium Finishing Plant) are given the highest ranking while
    environmental restoration and deactivation work is executed in a more
    constrained manner. The Paths to Closure analysis indicates that the
    funding profile for a number of sites decreases in the 2006-2010 time
    frame as projects are completed. Several major hazard-reduction
    projects at Hanford should also be completed by this time. We therefore
    anticipate that some additional EM funds will be available for the
    Hanford site for the TWRS project and environmental restoration
    activities.
        Question. What are the areas where the Plan does not meet the
    milestones of the Tri-Party Agreement? What is DOE doing to bring its
    planned work into compliance with the Agreement?
        Answer. Accelerating Cleanup: Paths to Closure is consistent with
    all current milestones in the Tri-Party Agreement (TPA) with the State
    of Washington and the Environmental Protection Agency. However, the
    Richland Operations Office's June 1998 Plan was developed prior to the
    signing of the BNFL contract. DOE is proceeding with negotiations with
    BNFL to determine the full scope and schedule of the privatization
    contract. The Department is also negotiating with the State of
    Washington to revise the current high-level waste milestones in the TPA
    based on the outcome of contract negotiations with BNFL.
        Question. The 2006 Plan and budget realities demand increased
    efficiencies in order to save resources which can then be applied to
    critical cleanup work. What were the results of negotiations between
    DOE, its regulators, and stakeholders to identify and agree upon needed
    efficiencies to cover project compliance shortfalls?
        Answer. The Department is continuing to strive for efficiencies to
    avoid shortfalls. This was the purpose of numerous discussions that
    were held between DOE, the field offices, federal regulators, state
    regulators and stakeholders. At Hanford, these meetings explored
    different means to get more work done given the existing budgets. The
    general areas that were identified as areas of potential savings and
    are currently being pursued are:
        44. Reduce the amount of money going to support activities (e.g.
    safeguards and security, project/program management).
        45. Reduce infrastructure costs and activities.
        46. Examine areas where DOE can improve and possibly reduce the
    requirements to make sure that excessive, low value activities are not
    placed on contractors.
        47. Work closely with regulators to ensure that we are only doing
    what is necessary to fix a problem.
        48. Perform the work that is currently being done in waste
    management and environmental restoration using fewer resources.
        49. Delete unnecessary work, or if it is not a high priority,
    explore the possibility of moving it to the future.
        The regulators and stakeholders actively participated in the fiscal
    year 2000 budget development. They are aware that additional
    efficiencies alone may not be sufficient to solve all future funding
    issues. We will work with the State and local stakeholders to address
    compliance issues that may arise.
        Question. What major cleanup activities remain to be accomplished
    at Hanford other than the tank remediation work?
        Answer. Other than tank remediation work, the other major Hanford
    cleanup projects include:
      --completion of stabilization activities at the Plutonium Finishing
            Plant;
      --removal of spent fuel from the K-Basins near the Columbia River and
            placement into the Canister Storage Building on the 200 Area
            plateau;
      --stewardship of nuclear materials and spent fuel pending final
            disposition;
      --retrieval, certification and packaging of transuranic wastes for
            shipment to the Waste Isolation Pilot Plant in New Mexico;
      --remediation of 1,497 contaminated areas (release sites); this will
            require moving almost 6 million tons of material, much of it
            from along the Columbia River, to safe disposal in the
            Environmental Restoration Disposal Facility in the 200 Area;
      --decontamination and decommissioning, and ultimately dismantlement
            and disposal of 244 structures including final disposition of
            the seven deactivated reactors in the 100 area;
      --remediation of contaminated ground water to prevent migration
            towards the Columbia River, including operation of ``pump and
            treat'' systems to extract contaminants such as chromium,
            carbon tetrachloride and strontium-90.
                      tank waste remediation system (twrs)
        Question. Explain the TWRS privatization proposal. How much will it
    cost to cleanup the storage tanks at Hanford?
        Answer. Under the privatization approach, the Department has moved
    from a government-owned, contractor-operated facility concept to a
    contractor-owned, contractor-operated facility concept where the
    Department will purchase the necessary Hanford tank waste treatment and
    immobilization services. In July 1998, the Department submitted its
    Report to Congress, Treatment and Immobilization of Hanford Radioactive
    Tank Waste, which details the history and the next steps in the
    privatization of the treatment of tank wastes.
        In February 1996, the Department solicited and awarded contracts
    for Phase I of the privatization contract, Part A, which required the
    contractor teams to demonstrate their technical, operations,
    regulatory, business and financial approach. During 1998, after a
    controlled process that analyzed contractor proposals, the Department
    selected BNFL, Inc., and authorized it to proceed to Part B-1 of the
    contract. We are now in Part B-1, which is a 24-month design period
    that is intended to develop sufficient engineering and financial
    maturity to establish fixed-unit prices and to finalize project
    financing terms, including BNFL's ability to obtain outside financing.
    The design phase ends in August 2000. DOE will then make a decision
    whether to authorize BNFL to construct and operate the facilities as
    proposed.
        If authorized, BNFL would provide both high-level and low-activity
    waste treatment and immobilization services and would be expected to
    process approximately 10 percent of the Hanford tank waste by mass and
    20 to 25 percent by radioactivity. Phase I is scheduled to be completed
    in 2018, with the potential to continue into Phase II with BNFL. The
    Phase II concept for full-scale production facilities to complete the
    tank waste remediation effort will be developed based on Phase I
    experience. Under all scenarios being considered for Phase II, the
    Phase I plant will be expanded and continue to operate in Phase II.
        The tank waste will be processed by using vitrification, a process
    that immobilizes the waste in glass. The less radioactive low-activity
    waste will be permanently and safely stored at the Hanford site. The
    high-level waste will be temporarily stored at Hanford. It will
    eventually be moved to a national repository. Both types of waste will
    be treated in the BNFL facility.
        The design, construction, and operation of the treatment facilities
    for both high-level radioactive wastes and low activity wastes will be
    the responsibility of BNFL. BNFL will commit its own equity to the
    project, augmented with additional financial backing to pay for
    facility construction. The Department will pay fixed-unit prices for
    delivery of the immobilized waste.
        In the fiscal year 2000 Congressional Budget Request, the
    Department estimated the cost of Phase I of the vitrification project
    to be approximately $12.5 billion (current year dollars). This estimate
    includes the cost to construct, operate, and deactivate the privatized
    vitrification facility, as well as BNFL's financing costs and fee. It
    also includes the costs that will be incurred by the Department at the
    Hanford site to support to the operations of the privatized facility,
    including activities to retrieve the waste from the tanks, deliver feed
    to BNFL, accept and store the low-activity and high-level vitrified
    products, and provide other infrastructure support to BNFL
        In the report Accelerating Cleanup: Paths to Closure, released in
    June 1998, the Department estimated the total life-cycle cost of
    cleaning up the 177 underground high-level waste storage tanks at
    Hanford to be approximately $52 billion (current year dollars). This
    estimate included the costs of both Phase I and Phase II. However, this
    estimate was prepared before the Department selected and authorized
    BNFL, Inc., to proceed with the design of the Phase I vitrification
    facility. The Department is currently evaluating several options for
    facility design and operations during Phase I, each of which has an
    impact on total life-cycle costs for the project. The Department will
    update and provide a revised total life-cycle cost estimate for the
    project as Phase I proceeds.
        Question. The budget request for fiscal year 1999 includes $106
    million, a slight increase over the current year level, to continue the
    Hanford TWRS privatization project. What activities were carried out in
    fiscal year 1998, what work is scheduled to be accomplished in fiscal
    year 1999, and what work is planned to be accomplished in fiscal year
    2000?
        Answer. Fiscal year 1998 resulted in the completion of Phase I Part
    A of the TWRS privatization contracts. Part A was a 20-month period to
    establish the technical, operational, regulatory, and financial
    elements required by privatized facilities to provide waste treatment
    services at fixed-unit prices. The 20-month period was divided into a
    16-month period for the contractors to provide Part A deliverables and
    a four-month period during which they were reviewed and DOE determined
    whether to proceed to Phase I Part B. During performance of Part A, the
    contractors developed two parallel solutions for 1) Low Activity Waste
    (LAW) treatment and immobilization services only, and 2) LAW and High-
    Level Waste (HLW) services. During fiscal year 1998, the DOE reviewed
    the deliverables from both contractors and negotiated a contract
    modification with BNFL to proceed into Phase I Part B-1.
        Fiscal year 1999 and fiscal year 2000 encompass the time period
    associated with Phase I Part B-1. During this period BNFL will: (1)
    optimize the LAW and HLW treatment and immobilization system, mitigate
    risk, and reduce contingencies in the waste treatment and
    immobilization system defined by BNFL during Part A of the contract;
    (2) revise the technical, operational, regulatory, and financial
    elements of the waste treatment and immobilization system; (3) provide
    firm fixed-unit prices for waste treatment services; and (4) perform
    all contractor activities necessary to reach financial closure for
    privatized facilities. The major decision affecting the TWRS
    privatization project, whether to authorize BNFL to proceed into
    construction and operation of facilities to treat the waste, is
    currently scheduled for August 2000.
        Question. What are the major compliance and other milestones and
    decision points for the remainder of fiscal year 1999 and fiscal year
    2000?
        Answer. Major compliance and other milestones and decision points
    for the Office of River Protection, which manages the Tank Waste
    Remediation System project, include Tri-Party Agreement (TPA)
    milestones, Defense Nuclear Facilities Safety Board recommendations,
    and decisions affecting scheduled for August 2000, whether to authorize
    BNFL to proceed into Phase 1B2 for construction and operation of
    facilities to treat and immobilize the Hanford tank waste. This
    decision will be made based on BNFL's success in completing an
    acceptable 30 percent design by August 2000, committing equity and
    arranging financing for the construction and operations of the
    facilities, and submitting an agreeable fixed unit price for treating
    and immobilizing the tank waste.
        The major TWRS compliance and other milestones for the remainder of
    fiscal year 1999 and fiscal year 2000 are:

    ------------------------------------------------------------------------
               Milestone                  Description             Date
    ------------------------------------------------------------------------
    TPA M-40-12....................  Resolve nuclear       30 Sep 99
                                      criticality safety
                                      issue.
    TPA M-43-12....................  Start construction    30 Jun 99
                                      for upgrades in the
                                      first tank farm.
    TPA M-43-13....................  Start construction    30 Jun 00
                                      for upgrades in the
                                      second tank farm.
    TPA M-45-08A...................  Complete systems      31 Dec 00
                                      description and
                                      operation strategy
                                      for tank leak
                                      monitoring and
                                      mitigation.
    TPA M-41 series (Consent         Initiate pumping for  30 Jul 99
     Decree).                         interim
                                      stabilization of
                                      single shell tanks
                                      S-102, S-103, and S-
                                      106.
    TPA M-41 series (Consent         Initiate pumping for  15 Jun 00
     Decree).                         interim
                                      stabilization of
                                      single shell tanks
                                      U-103, U-105, U-
                                      102, and U-109.
    TPA M-41 series (Consent         Reduce pumpable       30 Sep 99
     Decree).                         liquid remaining to
                                      be removed from
                                      single shell tanks
                                      to 93 percent of
                                      total liquid.
    TPA M-41 series (Consent         Reduce organic        30 Sep 00
     Decree).                         complexed pumpable
                                      liquids remaining
                                      to be removed from
                                      single shell tanks
                                      to 38 percent of
                                      total organic
                                      complexed pumpable
                                      liquids.
    DNFSB 93-5.....................  Transmit letter to    31 Dec 99
                                      DNFSB reporting       (originally 31
                                      completion of         May 98)
                                      topical report to
                                      resolve high heat
                                      safety issue.
    DNFSB 93-5.....................  Transmit letter to    30 April 00
                                      DNFSB reporting
                                      resolution of
                                      organic complexant
                                      safety issue.
    DNFSB 93-5.....................  Complete vapor        31 Dec 00
                                      sampling of all
                                      double shell tanks.
    ------------------------------------------------------------------------

        Question. How much does it cost annually to monitor and maintain
    the 177 tanks at Hanford? What do you expect these costs to be after
    the waste in the tanks is removed?
        Answer. The highest priority items with the TWRS budget are those
    necessary to maintain a ``minimum-safe'' condition. The current annual
    ``minimum-safe'' cost is about $100 million, and it is expected to
    remain at this level until the amount of high level liquid waste is
    substantially reduced.
        In the post-2028 time-frame, when all the liquid wastes in the
    tanks have been removed, treated, and immobilized, the tanks themselves
    will remain, along with some solid waste material in the bottom of the
    tanks. The final disposition for these residuals has not yet been
    determined, but nominal surveillance and maintenance will be continued
    until the tank farm area is completely remediated. The annual cost will
    be a small fraction of the current surveillance and maintenance costs.
        Question. What is the estimated total project cost for Phase I of
    TWRS, how does it compare with the cost estimate reported last year,
    and what accounts for the change?
        Answer. The BNFL contract for Phase I contains target prices for
    treatment and immobilization services during the construction and
    operations phase. These target prices will be refined during the design
    phase, which is August 1998 to August 2000. The current agreement
    negotiated with BNFL establishes a $6.9 billion target price (constant
    fiscal year 1997 dollars) for a 10-year, minimum-order quantity of
    treatment and immobilization services. This minimum-order quantity will
    treat 10 percent of the Hanford tank waste by mass and 20 to 25 percent
    of the radioactivity.
        This target price is higher than the original DOE estimate for
    Phase I. The fiscal year 1999 budget submission as reflected in the
    Construction Project Data Sheet showed an estimated cost of $5.14
    billion. The higher price is due in part to the fact that the hazards
    presented by the operations to be performed under the contract
    necessitated more substantial facilities for processing and confinement
    of the waste. These hazards are principally due to worker radiation
    protection and seismic requirements. These facilities will have a 30-
    year design life rather than the original concept of a 5 to 9-year
    demonstration facility. As a by-product of the longer design life, the
    proposed plant has the potential to treat additional waste, to treat
    waste with a broader composition range, and to treat, with limited
    additional investment, more than half of the tank waste by mass and
    approximately 95 percent of the long-lived radionuclides if the plant
    is expanded in a modular approach.
        Question. What is the basis for the $1.45 billion estimated total
    cost of the capital investment required under Phase I, and how
    confident is DOE that the capital investment can be held within this
    estimate?
        Answer. The estimated cost of the capital investment required under
    Phase I is $5.4 billion (current year dollars), as determined at the
    end of Phase I Part A. (The $1.45 billion was a preliminary estimate of
    construction costs developed prior to Phase I Part A.) At that time,
    the design was only about five percent complete; and, as more data and
    information become available, this cost estimate will be refined.
    However, because the construction costs have such a large impact on the
    total costs, DOE is working hard to control and manage these costs. The
    contract with BNFL includes incentives for BNFL to reduce the capital
    cost of the facility as part of the process of establishing ceiling
    prices for waste treatment services. These ceiling prices will be
    established prior to the start of Phase I Part B-2--the construction
    and operations phase of the project. DOE is also negotiating with BNFL
    to include in the contract incentives for BNFL to control and reduce
    these costs during Part B-2. Any cost reductions will result in a
    decrease in the price that DOE pays for waste treatment services.
        Question. Now, I understand that the requirement for Budget
    Authority for the TWRS privatization project increases from around $100
    million this year to about $600 million in 2001 and $660 million in
    fiscal year 2002. Am I correct, and if so, what will be the impact on
    the project if the committee is unable to provide the additional budget
    authority? What options would DOE have available to continue the
    project at that point?
        Answer. The Department identified in the fiscal year 2000
    Congressional Budget Request a target funding level for the TWRS
    privatization project of $606 million in fiscal year 2001 and $659
    million in fiscal year 2002.
        The Department would have several options if the target level of
    funding is not provided. The Department's determination of which of
    these options to proceed with would include a consideration of the
    magnitude of any funding shortfalls and the potential for additional
    funding shortfalls.
        First, the Department could renegotiate the terms of the
    privatization contract with the contractor. However, because the
    current funding targets represent the optimal schedule for the project,
    an extension of the schedule of the contract due to the unavailability
    of sufficient funds would lead to increased project costs. The
    magnitude of the cost increase would depend upon the extent of the
    funding shortfall and the length of the extension of the contract.
        Alternatively, the Department could abandon the privatization
    approach and proceed with a traditional level-of-effort or cost-plus
    contracting approach. Either of these approaches will present less risk
    to the contractor in a budgetary environment, where project funding
    fluctuates from year to year and the government is unable to provide
    any certainty to the contractor regarding future funding levels.
    However, these approaches again put the burden on the government for
    project risks and cost growth. Thus, these options may increase total
    project costs significantly.
        It should be noted that the contractor may not be able to secure
    adequate financing for the project if the government is unable to
    provide a sufficient amount of budget authority. The private sector may
    be unwilling to invest sufficient funds if it believes that the
    government is not strongly committed to the project. In the event of
    funding shortfalls, the contractor may attempt to either increase the
    contract price to cover the increased risk of project termination or
    even terminate the project.
        The Tri-Party Agreement (TPA) establishes enforceable milestones
    for removing and treating the high-level waste from the Hanford tanks.
    The Department is working with the State of Washington and the U.S.
    Environmental Protection Agency to re-negotiate milestones for the
    privatization project to align with the current privatization
    schedules. The Department is also seeking to establish alternative
    milestones in the TPA in the event the Department does not proceed with
    the privatized approach.
        Once the Department proceeds with the privatization approach, and
    is subject to milestones consistent with that approach, a renegotiation
    of the contract schedule or the abandonment of the privatization
    approach and the re-establishment of a traditional contracting approach
    could subject the Department to fines and penalties for non-compliance
    with TPA milestones.
        The Department believes that fully funding the privatization
    approach will provide the most cost-effective option for successfully
    meeting the government's obligation to remove the high-level liquid
    wastes from the Hanford tanks.
        Question. How does the TWRS privatization approach shift sufficient
    risk to the private sector to ensure that hoped for efficiencies and
    cost savings are realized?
        Answer. The most visible way to see the risk shift from the
    government to the contractor is through the payment process. Rather
    than using a ``cost-plus'' type arrangement, DOE is paying BNFL based
    on performance. In a cost-plus type of contract, DOE assumes all the
    risk. However, in a performance or fixed-price type contract, once the
    price is set for a given period, that price will be fixed through that
    period. If BNFL costs go up because of their own actions, differences
    would be absorbed from their funds; and DOE would not be responsible
    for that cost growth. If BNFL can reduce costs, they will benefit from
    the savings.
        It should be noted that DOE will still assume part of the risk
    relative to cost growth. DOE will assume risks from escalation and from
    uncontrollable circumstances. But again, any actions or decisions of
    BNFL that increase costs will be covered by BNFL. This places the
    equity investment of BNFL and its parent company at risk.
        In order to optimize the financing of the project, the Department
    is applying ``financial engineering'' skills to complement physical
    engineering skills. Financial engineering seeks to optimize the
    allocation of risks, rewards and penalties. The balance between public
    and private capital is critical to obtaining the best results. At
    succeeding points in the development of the project, there will be
    varying optimal capital structures. We will continuously review the
    financial structure to minimize the ``life cycle'' cost of the program
    over time.
        Financing for the construction and operations phase will involve
    BNFL equity, loans that are not backed by DOE (non-recourse debt), and
    loans that rely upon some level of credit support from DOE (recourse
    debt). Equity funding represents BNFL's direct corporate investment in
    the success of the project. This investment is in a ``first loss''
    position and would be at risk if the project should fail because of
    inadequate performance by BNFL. Originally it was hoped that sufficient
    private funding could be secured to fund the entire project. DOE now
    believes it will need to back a significant portion of BNFL's loans to
    enable BNFL to obtain sufficient and affordable private sector
    financing. However, government payment of debt occurs only after BNFL
    and its partners have lost all their equity investment and contingent
    liabilities. Therefore, only under a worse case scenario would the
    government be liable for the payment of the debt.
        By shifting risks that the contractor can control to the contractor
    and by using the right mix of incentives combined with the optimum mix
    of financing type, significant cost savings can be attained. Initial
    estimates indicate that, even with the financing costs associated with
    the BNFL contract, substantial savings can be realized over alternative
    contracting approaches. Private financing will inject powerful
    incentives to contain costs and to ensure project success.
        Question. What can you offer the committee that will assure us that
    this approach is the most effective and cheapest way for the government
    to procure this service?
        Answer. BNFL has provided DOE with a technically robust approach
    that is expected to perform as designed and that may be capable, with
    future capacity expansions, of processing essentially all of the
    Hanford tank waste. Also, one of Congress' concerns is that DOE's
    traditional contracting methods may not result in work being performed
    in an efficient and cost-effective manner. DOE has examined a number of
    different options to process the Hanford waste as quickly and cost
    effectively as possible. Based on the results of these studies and
    investigations, the privatization concept was selected. A summary of
    these comparisons was included in the July 1998 Report to Congress:
    ``Treatment and Immobilization of Hanford Radioactive Tank Waste.'' The
    establishment of fixed prices and the risk to the contractor's own
    equity together with incentives for cost reduction will drive the
    contractor to perform work under the contract in an efficient and cost-
    effective manner. DOE's evaluation has shown that work will be done
    more efficiently and cost-effectively than under DOE's traditional
    contracting approach.
        Question. Since financing costs are a significant part of the total
    project cost, why is it to the government's advantage to use this
    privatization approach?
        Answer. While the financing costs do represent a significant part
    of the total project cost, the privatization approach offers savings
    that balance these out. In our Report to Congress on the TWRS
    privatization, we provided some detailed information on the financing
    strategy and the benefits to be derived. Most specifically, the
    Department's experience in the traditional cost reimbursement
    contracting approach has been that schedules slip and costs increase.
    The government bears the financial burden associated with these project
    changes. The privatization approach places more responsibility on the
    contractor to control the costs and schedule. Because the contractor
    has a financial stake in the work to be performed, they are more
    motivated to stay within budget and on schedule. Also, the contractor
    assumes a greater share of the risks, particularly those under the
    contractor's control such as technology performance and operating
    efficiency. Private financing is shown to provide built-in incentives
    as the contractor's money is also at risk. Project failure would result
    in loss of equity. The contractor also has the incentive to perform
    more efficiently since this can result in additional profit to the
    company. The advantage to the government is realized through greater
    efficiency during project performance and through achieving project
    completion at cost and within schedule.
        The Department's current plan is to finance the privatization
    through the use of:
      --Equity from BNFL. This is typically the most expensive type of
            money because BNFL has this whole amount at risk should the
            project fail and therefore requires a higher return on
            investment.
      --Non-recourse debt. This money will is backed by the contractor and
            the projects ability to repay the money. This type of loan is a
            little more expensive than recourse debt because, if the
            project failed, the lender and BNFL could lose much of this
            money.
      --Recourse debt. This type of loan is backed by DOE, meaning that, if
            the project failed, DOE would ensure that BNFL has the money to
            repay its loan. This is the least expensive type of money, but
            it also puts less risk on the contractor and lender and more
            risk on DOE.
        Each source of money has costs and benefits associated with it. DOE
    is currently studying the mix of the different funding types to
    determine the percentage of each funding source that will be used to
    finance the TWRS Privatization. This study will not just consider the
    costs of the funding types but also the benefits of each. The final
    results of the study should indicate the optimum proportion of the
    different funding types, the associated costs, and the associated
    benefits. DOE is also evaluating other financing options in addition to
    those discussed above. The financing approach will be determined in
    August 2000.
        Question. Under Phase II B of the contract with BNFL, does the
    government have the option of whether or not to proceed with
    construction of waste processing facilities? If you do, when must that
    decision be made?
        Answer. At the end of the 24-month design phase of the contract
    (Phase I Part B-1), DOE will reach closure with BNFL on the cost of the
    project and the firm fixed price the DOE will pay to have the waste
    treated and immobilized. At that point, the contract can be terminated
    if the DOE determines that the price is too high, the technology is not
    satisfactory, or for any other reason which leads the DOE to conclude
    that continuation of the contract is not in the Government's best
    interest. This decision will be made in the summer of 2000.
        Question. What criteria will the Department base its decision on?
        Answer. At the end of the 24-month design phase (Phase I Part B-1),
    DOE will decide whether to proceed with the subsequent construction and
    operations portion or to pursue one of several other approaches to
    process waste. The BNFL authorization to proceed will depend on:
        1. DOE receiving acceptable fixed-unit prices
        2. Acceptance of the BNFL design for nuclear and chemical process
    safety
        3. Adequate assurance of technical success
        4. Assurance that BNFL can successfully manage the project
        5. Substantial equity commitment by BNFL
        6. Other significant financing arranged by BNFL
        7. Assurance that the M & I contractor at Hanford (Project Hanford
    Management Contract) can deliver waste to the facility on schedule
        Question. What impact would a decision not to proceed have on
    current compliance agreements?
        Answer. The schedule proposed by BNFL, Inc., for treatment of tank
    wastes in Phase I, which is required to comply with hazardous waste
    regulations, does not meet the current Tri-Party Agreement (TPA)
    milestones. The current milestones are based on an approach to the
    project that has since changed because of the complexities identified
    in Part A, and are no longer considered feasible. The Department has
    been working with the regulators on a proposed strategy for re-
    negotiating new TPA milestones which would align with current DOE/BNFL
    ``90 percent confidence level'' privatization schedules. These non-
    enforceable target dates would convert to enforceable milestones
    consistent with the Phase I Part B-2 contract including a reasonable
    contingency.
        The Department has proposed July 31, 1999, as the completion date
    for negotiations on TPA milestones for tank waste remediation. If
    negotiations are successful, DOE, Washington State and the EPA will
    have reached agreement on a set of commitments for the privatized
    approach to address the tank farm wastes. These commitments would
    include provisions for an alternative tank waste treatment approach
    should the Department decide not to proceed with the privatization
    approach.
        The milestones in the TPA are subject to enforcement by the State
    of Washington and the EPA. The State has already indicated its intent
    to take appropriate enforcement action for non-performance should we
    fail to successfully renegotiate the existing milestones. A decision
    not to proceed with privatization would be likely to significantly
    delay the development of treatment capability and increase the
    Department's vulnerability under the TPA.
        The capital portion is $5.4 billion from the overall $12.5 billion
    total project cost reflected in the fiscal year 2000 Congressional
    budget submission. The $12.5 billion also includes an estimated $5.1
    billion for facility operations and $2 billion for the Management and
    Integrating contractor support. We are working hard at reducing
    construction costs and considering various financial alternatives to
    understand their impacts on risk allocation between the government and
    BNFL. We will be discussing these alternatives with the Congress prior
    to decision on the next phase, the construction phase.
        Question. Do current OMB budget planning targets support the $600-
    $660 million requirement for new budget authority in fiscal year 2001
    and beyond?
        Answer. Yes. The Administration's request for advance
    appropriations is sufficient to cover the new budget authority required
    to support the TWRS Privatization Phase I project in the years fiscal
    year 2001 through fiscal year 2004. The amounts requested are
    sufficient to cover the funding profile for the project as presented in
    the Project Data Sheets in the Congressional Budget Request for fiscal
    year 2000.
        Question. Can you explain for the committee the concepts of loan
    guarantees, lease/purchase, or other arrangements, and how they affect
    the future budget picture for the TWRS project?
        Answer. The Environmental Management privatization approach
    requires the contractor to finance the acquisition of facilities to
    deliver cleanup services. As the contractor begins to provide cleanup
    services, DOE pays for its operating costs and the construction and
    financing costs the contractor incurred. Based on this approach, the
    Office of Management and Budget scores privatization projects (i.e.,
    determines when and how much budget authority and outlays will be
    counted against the budget caps) as service contracts, which means that
    only sufficient budget authority is needed each year equal to the
    government's legal obligations under the contract. If services will not
    be delivered until the construction of a facility is complete, outlays
    would not be scored during the construction period.
        If privatization projects were to be scored as the purchase, lease-
    purchase, capital lease, or operating lease of an asset, more budget
    authority and outlays would be counted against the caps earlier in the
    period of performance for the contract. For example, budget authority
    for a lease-purchase would be scored in the amount of the estimated net
    present value of the government's total estimated legal liability in
    the year budget authority is first made available. Outlays for a lease-
    purchase in which the government assumes substantial risk (e.g., with
    loan guarantees) would be scored across the construction phase of the
    contract.
        The TWRS project will be financed using BNFL equity, non-recourse
    debt, and recourse debt backed by the government. The debt supported by
    the government is not a loan guarantee because DOE is not making a
    commitment to the lenders to pay back the loans. The exact proportion
    of each type of financing has not yet been determined. The financing
    package will be a factor in the 24-month decision point to determine
    whether Phase I Part B-2 can begin. BNFL's equity is at full risk
    should there be a problem with the project. The more the government
    supports the debt (as it does with progress payments), the lower the
    financing cost of the project to the government. However, because the
    government is accepting the added risk, the overall cost of the project
    could rise even though the initial price to the government may fall. As
    the party best able to manage the risk is no longer totally responsible
    for managing its risk, the potential for failure increases and thus the
    potential for increased costs becomes higher. At the end of Phase I
    Part B-1, we will identify the optimum proportion for each type of
    money. For the current estimate, these different types of money have
    been accounted for and are included in the project estimates. Although
    the exact proportions may shift some, at present we believe that they
    will not shift enough to materially impact future budget requirements.
                              savannah river site
        Question. Explain the plan using the F-Canyon to help accelerate
    closure of Rocky Flats.
        Answer. The key to accelerating closure of Rocky Flats is removing
    nuclear materials from the site. Combined with substantial cleanup
    work, moving nuclear materials (e.g., plutonium and uranium) from Rocky
    Flats is the most critical element of our effort to reduce risks and
    costs. The Department has been working to identify receiver sites with
    appropriate facilities to manage the nuclear materials at the lowest
    cost with the greatest safety and security.
        On November 25, 1998, the Department issued the first Record of
    Decision on Management of Certain Plutonium Residues and Scrub Alloy
    Stored at the Rocky Flats Environmental Technology Site (RFETS). This
    Record of Decision announced that the Department had decided to ship
    the following nuclear materials to the Savannah River Site (SRS) for
    stabilization to help accelerate closure of Rocky Flats by 2006:
      --3,377 kg bulk (271 kg Pu) Sand, Slag, and Crucible (SS&C) and
            Plutonium Fluorides
      --700 kg bulk (200 kg Pu) Scrub Alloy.
        The first shipment of SS&C was received at the SRS from RFETS in
    early December of 1998. All the nuclear materials listed above are
    scheduled to be shipped to the SRS by July of 2001. All of these
    nuclear materials are scheduled for stabilization to metal in F-Canyon/
    FB-Line by May of 2002 for safe, interim storage at SRS.
        Question. What are the major elements and milestones for making
    this happen?
        Answer. There is only one major milestone for this stabilization
    effort: by May 2002 the Savannah River Site will convert the above
    Rocky Flats nuclear materials to stable metal and then package them to
    meet the metal and oxide storage standard. The Department committed to
    meeting this milestone in Revision 1 of the Implementation Plan for
    Defense Nuclear Facilities Safety Board Recommendation 94-1,
    Remediation of Nuclear Materials in the Defense Nuclear Facilities
    Complex, dated December 22, 1998. In addition, this stabilization
    effort is a milestone in the fiscal year 1999 Savannah River Site
    Annual Operational Plan/Westinghouse Savannah River Company/F-Area
    Stabilization Project/Summary Task Description Sheet, dated September
    2, 1998.
        The first shipment of SS&C was received at the SRS from RFETS in
    early December 1998. All the nuclear materials listed above are
    scheduled to be shipped to the SRS by July 2001. All of these nuclear
    materials are scheduled for stabilization to metal in F-Canyon/FB-Line
    by May 2002 for safe, interim storage at SRS.
        Question. How important is the opening of the WIPP to the success
    of this effort? What alternative or contingencies exist if WIPP does
    not open as scheduled?
        Answer. Being able to dispose of waste at WIPP is extremely
    important for the overall effort to accelerate closure of Rocky Flats,
    as well as several other DOE sites. The type of waste sent to WIPP,
    however, is transuranic waste that meets the WIPP waste acceptance
    criteria. The material being shipped to SRS for processing in the F-
    Canyon does not meet these acceptance criteria and cannot be disposed
    of in WIPP. Hence, the opening of WIPP has no impact on shipment of the
    Rocky Flats materials listed above to the Savannah River Site for
    stabilization and safe, interim storage.
        Question. Has the state of South Carolina approved this approach,
    and if not, what is the schedule for getting State approval?
        Answer. The Department provided copies of the Environmental Impact
    Statement (EIS) on Management of Certain Plutonium Residues and Scrub
    Alloy Stored at the Rocky Flats Environmental Technology Site (DOE/EIS-
    0277D and DOE/EIS-0277F) to the State of South Carolina when it was
    issued as a draft for public review and comment, and when it was issued
    as a final document. The Department also provided copies of the first
    and second Records of Decision (ROD) on Management of Certain Plutonium
    Residues and Scrub Alloy Stored at the Rocky Flats Environmental
    Technology Site (63 FR 66136 of December 1, 1998 and 64 FR 8068 of
    February 18, 1999) to the State of South Carolina. As documented in
    Chapter 9 of the final EIS, the various agencies of the State of South
    Carolina that reviewed the draft EIS either had no comment, or
    specified that the ``Project is consistent with our goals and
    objectives.'' The State of South Carolina had no comment on the final
    EIS, as documented in Section V of the first Record of Decision.
                    actinide packaging and storage facility
        Question. A key element/component to the Savannah River and DOE
    wide nuclear material storage and handling capability is the Actinide
    Packaging and Storage Facility and modifications to the K-Area
    facilities. How do these facilities fit into DOE's waste management
    strategy?
        Answer. These facilities are expected to be very important for
    secure storage of plutonium. The Actinide Packaging and Storage
    Facility (APSF) is intended to store plutonium from the Savannah River
    Site (SRS) and from the Hanford site near Richland, Washington. The
    Department intends to use SRS K Area facilities to store Rocky Flats
    plutonium. Both facilities will store plutonium until such time as the
    Materials Disposition (MD) facilities that will be used to prepare the
    plutonium for final disposition come on line.
        Question. Explain the major changes which have occurred on the
    Actinide Packaging and Storage Facility project and how the Department
    plans to proceed with this project in the future.
        Answer. There have been changes to the design of the APSF to expand
    storage capacity and reduce life cycle security costs (putting the
    vault underground), implementing International Atomic Energy Agency
    safeguards and security requirements, and reducing personnel exposure
    to existing project limits. A decision has been made to temporarily
    suspend work on the APSF pending a re-evaluation of functional
    requirements. This re-evaluation has become prudent given the
    significant estimated construction cost increases for the APSF
    subproject, coupled with the recent designation of the Savannah River
    Site as the preferred location for the surplus plutonium Pit
    Disassembly and Conversion Facility. We have concluded that it is
    advisable to halt further progress on the APSF to allow time to conduct
    a systems engineering evaluation of plutonium material management
    functions and planned new storage facilities at SRS. This study will
    consider the benefits and efficiencies available through designing and
    constructing storage facilities with an eye towards shared storage,
    economies of scale, and improved safety margins. The plan is to restart
    the APSF project in fiscal year 2001, implementing the results of this
    study.
        Question. How will the funds previously appropriated for this
    project be used?
        Answer. Funds previously approved for this project have been used
    to complete the original design of the facility and a number of other
    development activities that have led to the existing design package.
    The Department also intends to seek a $44 million reprogramming of
    fiscal year 1999 funds from Actinide Packaging and Storage Facility
    (APSF) to critical projects that have budget shortfalls. These include
    (1) upgrades to the ventilation systems in the F and H Canyons that
    address safety and health deficiencies, and (2) funding to support
    operations in the H Canyon facilities for stabilization of plutonium
    solutions.
                      in-tank precipitation project (itp)
        Question. DOE has experienced major problems with the In-Tank
    Precipitation Project which is a key facility in processing waste in
    storage tanks at Savannah River. Describe the problems encountered and
    why they were not foreseen .
        Answer. During the design and construction activities related to
    ITP, several studies and reviews raised questions about the operability
    and efficiency of the ITP process. These concerns dealt with various
    issues, including the generation of benzene, an explosive chemical.
    However, the extent to which very large quantities of benzene would be
    produced was not raised.
        The In-Tank Precipitation (ITP) Facility initiated radioactive
    operations in September 1995 to remove cesium and other radioactive
    components from Tank Farm waste salt solutions. During slurry pump
    operation in December 1995, benzene was generated from the reaction
    tank at higher rates than expected, presenting an explosion risk.
        Subsequent investigations revealed the source of the benzene was
    decomposition of sodium tetraphenylborate (TPB) that was added to
    precipitate cesium from the waste solution. ITP operations were
    suspended in March 1996 to better understand the ITP process chemistry
    and evaluate any impacts on down stream facilities.
        While benzene generation was expected as a result of this process,
    it was not anticipated to be produced at such high rates. Further
    investigations revealed that trace amounts of some elements such as
    paladium found within the waste were acting as catalysts driving the
    chemical reaction and subsequent benzene production to much higher
    levels then originally predicted. The presence of these catalysts was
    not known during the limited testing phase.
        Question. Also explain why the In-Tank Precipitation technology was
    selected.
        Answer. The ITP process was believed to be a cost effective
    alternative for separating high-level radioactive cesium from the other
    materials in the waste. There were several reasons supporting the
    selection of ITP.
        From a technical standpoint, ion-exchange was, and is, the more
    commonly used technology for separation processing. However, that
    technology was not as effective for the very alkaline high-level waste
    at the Savannah River Site. On the other hand, the tests supporting the
    ITP process at that time looked very promising.
        From a cost standpoint, the ion exchange alternative was expected
    to have a life-cycle cost (including capital and operating costs) in
    excess of one billion dollars. The ITP process used existing high-level
    waste storage tanks, which saved the costs of constructing new
    facilities.
        Question. How is the delay impacting waste processing efforts at
    Savannah River, and what is DOE doing to address issues relating to
    ITP?
        Answer. Waste processing and pretreatment activities continue for
    the sludge waste stream feed. Canister production continues at the
    Defense Waste Processing Facility (DWPF) with sludge-only canisters
    being produced. As of March 22, 1999, we have produced over 600
    canisters of the estimated 5,200 total (salt and sludge) canisters, and
    will continue to produce sludge-only canisters until the replacement
    for ITP is operational about fiscal year 2008.
        We originally anticipated that ITP would begin operation in fiscal
    year 1999 to pre-treat (i.e., separate out the highly radioactive
    cesium from the balance of the salt waste) and supply the salt waste
    stream precipitate (i.e., the cesium) for processing at DWPF. Due to
    significant technical and safety issues incurred due to the higher than
    anticipated levels of benzene generation with the ITP process, the
    restart of operations at ITP were suspended in January 1998.
        With the suspension of ITP efforts, we began a systems engineering
    approach in March 1998 to assess all potential alternatives for
    removing cesium from stored high-level waste solutions. This resulted
    in a recommendation to pursue three options with a final selection of a
    process in fiscal year 2000. The three options are: direct disposal as
    grout, small tank in-tank precipitation, and non-elutable ion exchange.
        On February 22, 1999, the Department published a Notice of Intent
    to prepare a Supplemental Environmental Impact Statement (SEIS) for the
    alternatives to the ITP process. As part of this process, two public
    scoping meetings were held in Columbia, S.C. and North Augusta, S.C. on
    March 11 and 18, 1999, respectively.
        In the SEIS, the Department will assess the potential impacts of
    the three ITP replacement processes and a no-action alternative. The
    Department does not have a preferred alternative at this time. However,
    the Department intends to complete this SEIS in the February 2000 time-
    frame, and a Record of Decision (ROD) some time after that.
        Question. What impact does this have on the Defense Waste
    Processing Facility operations?
        Answer. The Defense Waste Processing Facility will continue to
    produce sludge-only canisters, and, according to current waste feed
    projections, should be able to maintain production of sludge-only
    canisters until the year 2008 time-frame. At that time, we will need to
    have the alternative salt separation process in place and producing
    waste feed for DWPF.
        Question. How much funding was provided for the operation of the
    ITP facility in fiscal year 1998 and fiscal year 1999, and how have
    these problems affected the use of these funds?
        Answer. The funding for the operation of ITP was $19 million in
    fiscal year 1998 and $12 million in fiscal year 1999. These funds have
    been used to maintain the ITP facilities in a safe condition until
    final determination on the use of these facilities is made as a part of
    the overall Salt Alternative assessment process.
        Question. How will any unobligated balances be used?
        Answer. There were no unobligated balances for the Salt Alternative
    in fiscal year 1998 and we do not expect to have any fiscal year 1999.
        Question. What level of funding is included in the fiscal year 2000
    budget request, and how will those funds be used?
        Answer. The fiscal year 2000 budget request for the High-Level
    Waste Salt Alternative Disposition is $42 million. These funds will be
    used to complete the Supplemental Environmental Impact Statement
    (SEIS), support research and development activities on three
    alternatives to the ITP process, and construct a pilot prototype for
    the preferred alternative.
        Question. What date is assumed for the restart of ITP operations?
        Answer. fiscal year 2008 is the anticipated start of radioactive
    operations for any of the alternatives being evaluated.
        Question. Will DOE have to construct a new facility?
        Answer. Yes, if any of the three alternatives under consideration
    are selected, new facilities would have to be constructed. At this time
    we are also looking very closely at which, if any, existing facilities
    could be utilized.
        Question. Explain technology options being considered and the costs
    associated with each.
        Answer. Three technology alternatives are being evaluated. The
    costs identified below include capital costs and operating costs in
    support of construction for the necessary facilities associated with
    each alternative. They do not include the costs for operation or the
    facilities or for waste disposal. They are:
        Small Tank In-Tank Precipitation.--This alternative would use the
    same chemicals and process as the existing ITP batch process, but would
    use continuous flow, low residence time, and chilled tank processing.
    The high-level liquid waste would be mixed with monosodium titanate and
    filtered to remove adsorbed uranium, plutonium, and strontium. The
    adsorbed solids would be vitrified at DWPF. To capture the cesium, as
    with the larger ITP process, this process would use sodium
    teraphenylborate as the reactant to precipitate cesium out of the
    waste. The precipitate stream would be fed to DWPF to be vitrified. The
    smaller tank process would eliminate the benzene control uncertainties
    associated with the large tank process. Preliminary cost projections
    for construction of new facilities and the support activities necessary
    for implementing this process are $1.1 billion.
        Ion Exchange.--This alternative would use a different ion exchange
    medium from that previously considered. The medium (or resin) being
    proposed is crystalline silicotitanate (CST). The high-level liquid
    waste would be mixed with monosodium titanate and filtered to remove
    adsorbed uranium, plutonium, and strontium. The adsorbed solids would
    be vitrified at DWPF. The CST resin ion exchange columns would be used
    to remove the cesium from the salt solution. The cesium bearing-resins
    would be vitrified in the DWPF. Preliminary cost projections for
    construction of new facilities and the support activities necessary for
    implementing this process are $1.2 billion.
        Direct Disposal as Grout.--In this alternative, the high-level
    liquid waste would be mixed with monosodium titanate and filtered to
    remove adsorbed uranium, plutonium, and strontium. The adsorbed solids
    would be vitrified at DWPF. The filtered salt solution which would
    contain radioactive cesium would be combined with grout in a facility
    that would be constructed under this alternative, and disposed of in
    the SRS saltstone vaults. Preliminary cost projections for construction
    of new facilities and the support activities necessary for implementing
    this process are $900 million.
        Question. Do future OMB budget planning targets have sufficient
    room to accommodate a potential new facility to pre-treat the waste at
    Savannah River?
        Answer. The current OMB outyear targets provide a stable level of
    funding for the Environmental Management program under the assumption
    that the Administration's Social Security reform and other proposals
    are enacted. To accommodate new requirements, such as the salt
    alternative program, within these current targets, the EM program will
    have to become more efficient and/or reprioritize currently planned
    activities. EM intends to work with OMB, regulators, stakeholders, and
    the Congress on such funding and prioritization issues as they arise.
                          canister production at dwpf
        Question. Explain the reason why canister production is falling off
    in fiscal year 2000.
        Answer. The Department's fiscal year 2000 budget request stated
    that it would be necessary to reduce sludge-only canister production
    from its current level of 200 to 100 in fiscal year 2000 to accommodate
    funding for salt alternative work. The reduced canister production,
    accomplished by slowing down the waste removal activities, would then
    provide additional funding for continued study of the high-level waste
    salt alternatives.
        However, subsequent to the fiscal year 2000 budget submission, and
    based on senior level discussions and consideration of all factors
    involved, the Savannah River Site has committed to maximizing canister
    production (about 200 canisters) in fiscal year 2000.
                           processing of heavy water
        Question. Last year Congress provided additional funds for the
    Department to process tritium-contaminated water stored at the Savannah
    River site. Could you update the committee on the current status of
    this program? Has the agreement with Canada been completed and signed?
    If not, why?
        Answer. As currently planned, the heavy water contract with Atomic
    Energy of Canada, Limited (AECL) will be in two parts. We expect to
    sign the first part of the contract at the end of April 1999. Under the
    first part of the contract, AECL will ship 35.5 metric tons (MT) of
    clean heavy water to the National Institute of Standards and Technology
    (NIST) to meet Savannah River Site (SRS) commitments to NIST. SRS will
    then ship 50 MT of tritium-contaminated heavy water to Canada to
    replace the clean heavy water shipped to NIST. By the end of May, we
    expect to sign the second part of the contract. This part of the
    contract will result in shipment of an additional approximately 950 MT
    of tritium-contaminated heavy water to AECL.
        AECL has decided to team with a Canadian partner, who will provide
    the financial support needed for AECL to accomplish their functions
    under the contract, as well as construct and operate a detritiation
    facility in Canada. In addition, the Department has decided to add an
    option to include another 500 metric tons of heavy water in the
    contract, if and when the Accelerator Production of Tritium (APT)
    program determines that it no longer needs or wants the water. This
    heavy water is now being held in reserve for the APT program. When AECL
    has negotiated a contract with their partner, we believe that all
    preparations will be in place for both the Department and AECL to sign
    the second part of the contract. The contract has been delayed until
    now due to the contract changes discussed above and the fact that AECL
    needed to find a funding source for their efforts.
        Question. Does the fiscal year 2000 budget request continue to
    support the program adequately and in accordance with the agreement?
        Answer. Recognizing that the contract has not been finalized, the
    fiscal year 2000 budget request provides sufficient funds for this
    program.
        Question. Does the Department believe the program is cost effective
    and in the U.S. interest.
        Answer. Yes. The Department no longer needs the heavy water.
    Therefore, continuing to store this material is not cost-effective for
    the Department. The revenues from the sale of heavy water will offset
    the cost of cleaning up the former heavy water production and storage
    facilities.
                         oak ridge national laboratory
        Question. The budget request for the Oak Ridge National Laboratory
    proposes to transfer several activities conducted under non-Defense
    environmental management to the Defense Environmental Management
    program for fiscal year 2000. The total amount to be transferred is
    estimated to exceed $60 million.
        Please explain the reasons for proposing the transfer of several
    programs previously conducted under the non-Defense environmental
    program over to the Defense environmental management account for fiscal
    year 2000. What is the total amount proposed to be transferred?
        Specifically, what is the direct link to the Defense work that
    would support the transfer to Defense EM?
        Provide for the record a crosswalk which shows all programs or
    activities being proposed for funding in the fiscal year 2000 budget
    under Defense Environmental Management which were funded outside of the
    Defense EM program last year. The crosswalk should show the amount of
    funding in fiscal year 1999 and where it was provided, the request for
    fiscal year 2000 and where it is requested, along with a brief reason
    for the move, including a brief explanation of the direct link with
    defense activities which would support the Department's proposal.
        Answer. The Oak Ridge National Laboratory is a complex, multi-
    funded site, which supported both weapons production (defense) and
    energy research (non-defense) activities through the years. While waste
    generated or shipped to the Bethel Valley and Melton Valley sites was
    from both non-defense and defense funded activities, the majority of
    the waste was produced from defense activities, including early
    prototype reprocessing activities.
        Historically, funding for environmental management activities at
    Bethel Valley and Melton Valley was provided both from the defense and
    non-defense accounts. During the 1980's funding was solely from the
    defense account. Beginning in the early 1990's, funding for these two
    sites was provided from both the defense and non-defense accounts. (In
    fiscal year 1990 through fiscal year 1998 approximately $230 million
    was provided from the defense account and approximately $260 million
    from the non-defense account for environmental restoration activities.)
        In fiscal year 1999, funding for environmental management
    activities at these two sites was exclusively from the non-defense
    account. The reason for this decision was due to budget constraints on
    the defense account. The non-defense account no longer has the
    flexibility to accommodate funding these important activities. For
    example, in fiscal year 1999 Congress increased the defense
    appropriations by about $90 M from the requested level, and decreased
    the non-defense appropriations by about $30 M (out of $462 M) (6
    percent). The Department believes that because the majority of waste at
    the Oak Ridge sites is from defense funded activities, it is
    appropriate that funding be provided from the defense account. This is
    reflected in the fiscal year 2000 budget request. In addition, under
    the new Management and Integration contract for environmental
    management activities at ORNL there will be many more fixed price
    subcontracts than in the past. The administration of these numerous
    subcontracts would be much more difficult to manage if they were funded
    from two different accounts. Thus, in order to streamline the program
    management and administration costs, the decision was made to fund this
    work from one account. The defense account was chosen because, as noted
    above, the majority of waste at these sites is from defense funded
    activities.
        The following four activities at Oak Ridge National Laboratory were
    funded from the Non-Defense Environmental Management Appropriation in
    fiscal year 1999, and now are being requested in the Defense
    Environmental Management and Waste Management Appropriation. The
    crosswalk follows:

                                                [In thousands of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                        NON-DEF                              DEFENSE
                                                                        FISCAL                               FISCAL
                     TITLE                         NON-DEF PBS           YEAR           DEFENSE PBS           YEAR
                                                                         1999                                 2000
    ----------------------------------------------------------------------------------------------------------------
    Melton Valley D&D.....................  OR43201..................    33,434  OR43101..................    24,307
    Melton Valley RA......................  OR43202..................     2,573  OR43102..................     1,300
    Bethel Valley RA......................  OR43203..................    18,473  OR43103..................    28,569
    Bethel Valley D&D.....................  OR43204..................     5,197  OR43104..................     3,626
                                                                      ----------                           ---------
          Total...........................                               59,677                               57,802
    ----------------------------------------------------------------------------------------------------------------

        Question. What is the National Metal Recycle Center which is being
    funded from Oak Ridge Defense Direct Support in fiscal year 2000? What
    level of funding was provided for this Center in fiscal year 1999 and
    previous years? Provide a detailed breakout of the $4.162 million being
    requested for Direct Support-Defense activities compared to the $2.898
    funding level for fiscal year 1999.
        Answer. The National Center of Excellence for Metal Recycle was
    created in October 1997 to facilitate the cost effective recycle of
    clean and decontaminated metals at DOE sites across the country. The
    Center identifies recycling opportunities and provides technical
    assistance to all DOE sites on projects that may be able to realize
    cost reductions through recycling of materials for unrestricted use.
    The Center provides expertise to support the evaluation of cost and
    risk aspects of specific recycling projects to make sure that each
    project is safe and cost effective. The Center's goal is to make
    recycling a well understood and commonplace component of our cleanup
    projects. The Center has already participated in six large projects and
    several smaller actions that resulted in the recycling of 11,000 tons
    of metal, with an estimated savings to the Department of approximately
    $9.9 million.
        The Oak Ridge Operations Office funds the Center, which provides
    technical assistance to any site or recycling project in the DOE
    complex. The Center receives funds from each of the three main Oak
    Ridge appropriations, that is, Post 2006 Completion Defense, Post 2006
    Completion Non-Defense, and the Uranium Enrichment D&D Fund. The total
    funding for the Center in fiscal year 1998 was $700,000 and $900,000 in
    fiscal year 1999. The fiscal year 2000 Congressional Budget Request
    includes $900,000 for this program.
        The requested detailed breakout of the direct support-defense
    activities (PBS OR-48104) is provided below:

                            [In thousands of dollars]
    ------------------------------------------------------------------------
                                                              Fiscal year
                                                         -------------------
                                                            1999      2000
    ------------------------------------------------------------------------
    Agreements In Principle.............................     1,650     1,225
    DOE Direct..........................................     2,000     2,437
    Metal Recycle.......................................       100       500
                                                         -------------------
          Total.........................................  \1\ 3,75     4,162
                                                                 0
    ------------------------------------------------------------------------
    \1\ The current total fiscal year 1999 is $3.75 million. However, only
      $2.898 million was shown in the fiscal year 2000 budget request due to
      the availability of carryover funds. Therefore, Defense -funded Direct
      Support requirements have really only increased a net of approximately
      $400K.

        DOE Direct funding covers crosscutting program technical
    requirements such as: support to the EM portion of transportation
    activities; technical program support in the areas of independent
    validation; readiness assessments and laboratory audits; and State
    mixed waste fees. This activity also supports corporate and educational
    initiatives such as Historically Black Colleges and Universities/
    Minority Educational Initiatives and educational grants to local
    schools. The increase in fiscal year 2000 represents increased funding
    for independent validation of program baselines and increased
    independent audit requirements.
                        environmental management centers
        Question. Regarding special ``Centers'', how many other ``Centers''
    is DOE funding in the Environmental Management program? Provide for the
    record a list of those ``Centers'' showing where each ``Center'' is
    funded, what funding has been provided each year for the past 4 years,
    the funding profile over the next 5 years, and what the benefit they
    provide to the Defense EM program?
        Answer. The Metal Recycling Center is the only Oak Ridge Center.
    The majority of the Centers of Excellence were established in fiscal
    year 1997, therefore the funding profile will begin with fiscal year
    1997. Attached is a chart depicting where each center is located and
    the funding profile, as well as a brief description of the benefits
    provided to the Environmental Management Program.

                                 DEFENSE ENVIRONMENTAL RESTORATION AND WASTE MANAGEMENT
                                                [In thousands of dollars
    ----------------------------------------------------------------------------------------------------------------
                                                           Fiscal year
          Center of excellence       -------------------------------------------------------  Description/benefit of
                                         1997       1998       1999       2000    2001-2006          centers
    ----------------------------------------------------------------------------------------------------------------
    Albuquerque: LLW/MLLW Center of     ( \1\ )    ( \1\ )    ( \1\ )    ( \1\ )    ( \1\ )  Prepares Federal
     Excellence \1\.                                                                          Facilities Compliance
                                                                                              Act, Chief Financial
                                                                                              Officer Report to
                                                                                              Congress.
    Chicago: Risk Management Center       1,103      1,962      2,389      2,415     14,490  Provides technical
     of Excellence.                                                                           expertise and support
                                                                                              to help field offices
                                                                                              implement EM/DOE risk
                                                                                              initiatives; technical
                                                                                              assistance to field on
                                                                                              the Accelerated Paths
                                                                                              to Closure
                                                                                              development.
    Idaho: LLW/MLLW Center of Excel-  .........        498        395  .........     13,264  Idaho is the lead for
      lence \1\.                                                                              complex-wide
                                                                                              Environmental
                                                                                              Management integration
                                                                                              efforts for LLW/MLLW
                                                                                              (opportunities for
                                                                                              acceleration of
                                                                                              cleanup, mortgage
                                                                                              reduction, cost
                                                                                              savings).
    National Spent Nuclear Fuel Pro-     19,844     21,952     26,092     14,275     82,338  Idaho will provide
      gram \1\.                                                                               overall program
                                                                                              management to safely
                                                                                              and efficiently manage
                                                                                              DOE-owned spent
                                                                                              nuclear fuel and
                                                                                              prepare it for
                                                                                              disposal.
    Nevada: LLW/MLLW Center of          ( \1\ )    ( \1\ )    ( \1\ )    ( \1\ )    ( \1\ )  Provides technical
     Excellence \1\.                                                                          assistance to the LLW
                                                                                              Federal Review Group;
                                                                                              completes disposal
                                                                                              facility Performance
                                                                                              Assessments/Composite
                                                                                              Analyses and leads
                                                                                              effort to consolidate
                                                                                              site audits of
                                                                                              treatment, storage and
                                                                                              disposal facilities.
    Savannah River:
        National Environmental            1,000      1,600      1,500      1,500      6,000  Coordinates/manages EM-
         Training Office Center of                                                            related technical
         Excellence.                                                                          training and
                                                                                              facilitates increased
                                                                                              standardization of
                                                                                              contractor training.
        National Spent Nuclear Fuel     ( \1\ )    ( \1\ )    ( \1\ )    ( \1\ )    ( \1\ )  Savannah River is the
         Program **.                                                                          lead for aluminum-
                                                                                              based and Foreign
                                                                                              Research Reactor
                                                                                              fuels.
    FETC: Center for Acquisition and      2,125      1,275      1,594      1,702     10,841  Serves as a field
     Business Excellence.                                                                     resource in areas such
                                                                                              as research
                                                                                              acquisition plan
                                                                                              development, business
                                                                                              and technical
                                                                                              assistance in
                                                                                              developing procurement
                                                                                              strategy, and
                                                                                              identifying and
                                                                                              promulgating best
                                                                                              practices and lessons
                                                                                              learned.
    ----------------------------------------------------------------------------------------------------------------
    \1\ Funding for both the LLW/MLLW and National Spent Fuel Centers of Excellence are requested under Idaho and
      released to other sites during execution.

                                     ______

                     Questions Submitted by Senator Cochran

                             science and technology
        Question. Mr. Owendoff, one of the Department of Energy's major
    thrusts has been privatization of its cleanup efforts. One of the
    dangers of privatization is that private companies are selling general
    solutions that are not always tailored to the specific waste site.
    Without proper departmental oversight and necessary tailoring, these
    already expensive solutions can become even more costly.
        How is the Department of Energy using university organizations--
    such as DIAL at Mississippi State University--to provide independent
    evaluations of the feasibility of cleanup proposals, such as the $10
    billion cleanup effort at Hanford, Washington?
        Answer. The Department is currently using a number of university
    organizations and faculty--including for example, the Diagnostic
    Instrumentation and Analysis Laboratory (DIAL) facility at Mississippi
    State University; the Hemispheric Center for Environmental Technology
    (HCET) facility at Florida International University; and the Institute
    for Central and Eastern European Cooperative Environmental Research at
    Florida State University--to provide independent evaluations of the
    efficacy of environmental technologies in cleanup proposals. The
    Director of the DIAL facility has, for example, recently been invited
    to participate in an independent assessment of the baseline technology
    proposed by the privatization contractor for the Tank Waste Remediation
    System at Hanford, Washington. In addition, researchers at DIAL are
    currently working on validating a critical thermodynamic equilibrium
    model that will be directly applicable to successful treatment of the
    waste contained in all Hanford tanks, and to the work of the
    privatization contractor.
                       waste isolation pilot plant (wipp)
        Question. Mr Owendoff, the Mississippi Emergency Management Agency
    has been informed that the Waste Isolation Pilot Plant (WIPP) program
    budget has been cut by $513,000. Mississippi and other states, through
    which transuranic waste will ultimately travel to WIPP, have been using
    this money to prepare for the impending shipments and address safety
    concerns associated with them. With reduced funding for WIPP, how will
    states such as Mississippi adequately prepare for the safety concerns
    associated with these transuranic waste shipments?
        Answer. On March 22, 1999, Judge John Garrett Penn concluded that
    the permanent injunction he issued in 1992 does not prevent the
    shipment of waste, and that WIPP has interim status under RCRA. This
    ruling resulted in the Department completing the first shipment of
    transuranic waste to WIPP on March 26, 1999. The Department plans to
    continue shipments of waste to WIPP and to increase the rate of
    shipments to 17 per week.
        Since WIPP did not open when originally planned, the Department had
    withdrawn approximately $13 million from the Carlsbad Area Office
    budget to offset increased waste management costs at the sites where
    transuranic waste is stored. However, now that shipping has begun, we
    have already released funding for the Southern States Energy Board,
    which supports the Mississippi Emergency Management Agency.

                              subcommittee recess

        Senator Craig. Gentlemen, thank you very much for your time
    and your willingness to be forthright in your responses.
        The subcommittee will recess.
        [Whereupon, at 11:06 a.m., Thursday, March 18, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

        ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2000

                                  ----------

                            TUESDAY, APRIL 13, 1999

                                           U.S. Senate,
               Subcommittee of the Committee on Appropriations,
                                                        Washington, DC.
        The subcommittee met at 9:42 a.m., in room 138, Dirksen
    Senate Office Building, Hon. Pete Domenici (chairman)
    presiding.
        Present: Senators Domenici, Reid, and Dorgan.

                              DEPARTMENT OF ENERGY

                               Office of Science

    STATEMENT OF DR. MARTHA KREBS, DIRECTOR

                Office of Nuclear Energy, Science and Technology

    STATEMENT OF BILL MAGWOOD, DIRECTOR

                Office of Energy Efficiency and Renewable Energy

    STATEMENT OF DAN REICHER, ASSISTANCE SECRETARY

                     OPENING STATEMENT OF SENATOR DOMENICI

        Senator Domenici. The hearing will please come to order.
        First, I want to welcome my ranking member and indicate to
    him that since he has a time schedule that is difficult, I will
    let you proceed wherever you would like.
        Would you like to make your opening statement?
        Senator Reid. No, I'm okay.
        Senator Domenici. Today, the subcommittee will review the
    Department of Energy's budget request for the Office of
    Science, the Office of Nuclear Energy, and the Office of Energy
    Efficiency and Renewable Energy programs. In that regard, we
    will hear from Dr. Martha Krebs, Director of the Office of
    Science; Mr. Bill Magwood, Director of the Office of Nuclear
    Energy Science and Technology; and Mr. Dan Reicher, Assistant
    Secretary of Energy for Energy Efficiency and Renewables.
        Before we begin, I want to compliment all three witnesses.
    Mr. Magwood assumed his responsibilities after Congress was
    extremely critical of the management of the Office of Nuclear
    Energy Science and Technology and has initiated a number of
    interesting, and worthwhile programs. We thank you for that.
        Dr. Krebs is the first Director of Science at the
    Department of Energy, since we created that office last year in
    this committee. We thought there ought to be one focal point
    for all of science. It was predominantly under you before, but
    now it is unequivocal, in that now there is one office and you
    are in charge.
        Beyond that, obviously, she has other duties. She manages
    some of the Department's most exciting research in the human
    genome, high-energy physics, fusion energy, and other areas, or
    I should say as part of that office. Those are all exciting
    functions for the Department.
        I have a great deal of confidence in Mr. Reicher. The
    programs for which he is responsible within the jurisdiction of
    this subcommittee, if we were able to provide the amount in
    request, would expand 50 percent since 1998. I do not think
    that we are going to be able to do that, however, but I do not
    think the resources are going to be more fully justified.
        But within the request, I do see some changes that I find
    encouraging. I see an effort to move away from short-term
    thinking and deployment toward long-term research. I see an
    effort to choose among technologies and to stop pursuing
    technologies that are not making necessary advances.

                         climate change budget request

        With that said I must point out that, in my opinion, the
    funding is rather lopsided in the President's request in terms
    of dealing with climate change. Within the subcommittee
    jurisdiction, the Administration has requested $436 million for
    research and development related to climate change. Of that,
    $399 million is for solar and renewable energy, $33 million is
    for science, and a paltry $5 million is for nuclear energy.
        I do not know how much longer policy makers are going to be
    able to carry on this kind of a charade by continuing to ignore
    nuclear power as we attempt to address the issue of climate
    change. So I have to wonder if the Administration is serious
    about climate change or is simply using this opportunity to use
    renewable energy as a kind of a bone that they throw money at
    indicating that it will solve the global climate issue.
        I do not believe that is the case, and I do not know how
    much longer we can continue to say to those who know we need
    nuclear energy that this approach and this kind of balance or
    lack of balance is something realistic.
        Having said that, as soon as the distinguished Senator from
    Nevada is finished, we are going to start with you, Dr. Krebs,
    followed by Mr. Magwood, and then Mr. Reicher.
        Senator Reid.

                           STATEMENT OF SENATOR REID

        Senator Reid. Mr. Chairman, thank you very much. Again, I
    apologize to you and the witnesses. I had the morning cleared
    for this hearing, but there was a meeting called at the White
    House and I am obligated to attend, so I am going to have to
    leave here at about 10:15.
        I would ask permission that I be allowed to submit the
    questions that I had prepared to these witnesses and that they
    respond in a reasonable period of time.
        Senator Domenici. That will be the order. The questions and
    the Department's responses will be included at the appropriate
    place in the record.

                         renewable energy technologies

        Senator Reid. First I want to talk about energy efficiency
    and renewable energy.
        Mr. Reicher, energy-efficient advances in building
    insulation, lighting technologies, and many other things have
    saved the country enormous quantities of energy and money, and
    I would like to think that work we have done within this
    committee to direct attention to that has been one of the cost-
    saving areas that we have done, and we should be proud of these
    accomplishments.
        Renewable energy sources that do not contribute to
    pollution or global warming can be just as successful if these
    technologies can become cost competitive with proven power
    technologies. Tax incentive is another artificial subsidy
    which, in my opinion, can never replace the effectiveness of
    cost savings, and so competitiveness has to be a primary goal
    in the renewable energy program.
        Mr. Chairman, I just returned from a trip to South America,
    and in Brazil they decided to privatize the power industry.
    They went from 60,000 employees that worked for the Brazilian
    government, now that it's private, to 6,000, and it is much
    more effective and working very well. Can you imagine that,
    60,000 to 6,000?
        So my point here is that tax incentives and artificial
    subsidies can never replace the effectiveness of cost savings.
    Competitiveness has to be the primary goal in renewable energy
    and some of our other programs. I hope that testimony here, Mr.
    Reicher, will demonstrate the Department's commitment to
    developing renewable resources that are market-driven instead
    of policy-driven.
        I am particularly interested in the program, because Nevada
    is a state with significant renewable energy potential, as is I
    think much of the Southwest, which has not been fully
    developed.
        We know that commercial geothermal power production is an
    important resource already in northern Nevada. However, in
    spite of high potential for wind power generation, no wind
    power has been developed in Nevada. I have spoken to you and
    others. There may be some problems with that, because of the
    wind now blowing like it does in some parts of California, but
    it is something I think we need to take a look at. We, in
    Nevada, think the wind blows all the time.
        Finally, Nevada is at the very center of the highest
    quality solar power potential in the country. We have been told
    by experts that there is enough sun generated where the Nevada
    test site is located to supply power for the whole United
    States, and the largest producer of solar power in the country
    is down near Barstow, that is 200-megawatt facility, very small
    compared to the potential available. So I think we need to do a
    better job of solar energy.
        The United States, particularly Nevada, will benefit
    enormously from the development of cost-competitive and
    renewable energy. So I wish you well.

                        science research budget request

        As far as science, Dr. Krebs, the $2.8 billion request for
    science programs competes significantly with other priorities
    in our appropriations bill, such as water projects that are
    important to many western states. Many seem to see science as a
    luxury that can be reduced, later even abandoned. I do not
    agree with that.
        I believe that science provides one of the foundations of
    leadership that the United States clearly must show in its
    economy, its quality of life, and its ability to promote global
    peace and security.
        It is important that you, Dr. Krebs, demonstrate the
    relevance and priority of your programs, because these programs
    are very difficult to sustain given some of the other
    priorities that people have looked to this subcommittee for
    years to fund. One of the projects that I think we have to take
    a close look at, we need to understand the development of
    geologic faults, and their permeability is being reduced,
    because I understand there are some general reductions in geo-
    sciences.
        This topic is critical to understanding what is going on in
    the western United States. We had the serious earthquake in
    Northern California and a serious earthquake in Southern
    California.
        Nevada is the second most earthquake-prone state in the
    United States, and with the population growth as it is there, I
    think we need to do a lot better in understanding earthquakes.
    That also, as part of that, is the problems we are having on
    nuclear waste. So I hope that you will all personally within
    your discretion do a good job of promoting science programs,
    because we need help in this subcommittee to do that.

                            nuclear energy programs

        Last, Mr. Chairman, nuclear energy. Last year this
    subcommittee held a hearing on the future of nuclear energy.
    For the past 2 years the Administration has proposed a couple
    of initiatives, the Nuclear Energy Research Institute and the
    Nuclear Energy Plant Optimization. I want to build upon what
    you have just said, Mr. Chairman.
        I am not opposed to nuclear waste, if, in fact, we can show
    that it is safe, but I think we cannot even consider more
    nuclear power production unless we talk about the number one
    problem dealing with nuclear power, and that is what you do
    with the waste. That has taken months of our time here in the
    Senate, what are we going to do with nuclear waste, and I find
    that not addressed.
        We have to do something about that before we can talk about
    developing more nuclear power. Unless we can handle the waste,
    there will never be nuclear power. That is in addition to all
    the safety problems that we have.
        So I hope and I agree with the chairman of the
    subcommittee, that I doubt that geologic disposal will ever be
    found acceptable. If we are going to do more with nuclear power
    generation, we have to be able to answer what we are going to
    do with disposal.
        I compliment and applaud the chairman that he is willing to
    take a look at other methods of disposing of nuclear waste. So,
    Mr. Chairman, thank you very much for your allowing me to go on
    with this extended statement. I look forward to the witnesses'
    testimony.
        Senator Domenici. Thank you very much, Senator.
        Senator Dorgan, do you have some opening remarks?

                          STATEMENT OF SENATOR DORGAN

        Senator Dorgan. Just very briefly, Mr. Chairman.
        The President has a briefing on Kosovo this morning, so I
    regret I will not be able to attend the entire hearing. But I
    did want to comment and indicate that the President's proposed
    increases in both the conservation program and also the request
    for expenditures on renewable fuels, I think, is one of a whole
    series of approaches to deal with climate change; but it also
    represents investments in the right kinds of things.
        I welcome Dr. Magwood and Dr. Krebs. I do not know quite as
    much about your work as I do of Mr. Reicher's, but am
    interested in learning, and have been reading some of the
    statements that you are offering today.
        I want to thank Mr. Reicher, he came to North Dakota and
    pronounced that North Dakota was the Saudi Arabia of wind
    energy. I guess only when I am home he meant that to be the
    case, but that does not mean that is what we are producing from
    wind energy, but the potential in North Dakota is quite
    extraordinary in wind energy, and bio-mass and wind energy
    programs, I think, hold great promise, and I appreciate very
    much the leadership of Mr. Reicher.
        I found out during his visit in North Dakota that he has
    kayaked the Yangtze River, and I wondered whether someone who
    decided they wanted to kayak the entire Yangtze River was fit
    for public service after that, and I discovered he is. He is an
    extraordinary asset to our government. I appreciate all three
    of you being here and presenting testimony today about these
    important areas.
        If we can make the right kinds of investments and make the
    right kinds of choices about our energy future, we can address,
    even as we make those choices, a lot of the significant
    problems that lie ahead of us, and that is part of what the job
    of this subcommittee is about, to help make those choices. The
    President has made recommendations. I think they are sound
    recommendations.
        The proposed increases in areas, solar and wind, $274
    million in the President's request, geothermal, $29 million,
    and so on, represent, in my judgment, good choices, and I am
    pleased to be here to support them, and pleased to welcome the
    panel.
        Mr. Chairman, thank you very much.
        Senator Domenici. Thank you very much, Senator.
        I just wanted to say, particularly to you Senator Reid,
    with reference to the admonishment toward the Science Program.
    Dr. Krebs has a very high post, and of great concern to us,
    because we need clear thinking and as much as we can get with
    reference to science.

                             human genome projects

        I do not know if you know, Dr. Krebs, but one of the
    greatest wellness and health programs, research programs, that
    ever came upon human beings is genome research--it will
    revolutionize how we get well, stay well, and how we get rid of
    hundreds of very, very big diseases that have bothered humanity
    for a long, long time.
        I think when people ask whether the Department of Energy is
    really a science institution, you ought to hold your head up
    proudly and say, ``Well, but for the Department of Energy and
    Dr. Charles DeLisi, who moved to DOE from NIH, we would not
    have the genome project.''
        He was at NIH, and they did not want to start that project,
    so he, in frustration, moved over to your department, and came
    up to see me, and said, ``This is a great thing, we ought to do
    it,'' and as a matter of fact, within 7 or 8 months, Senator
    Lauton Chiles and I started it without any authorization,
    nothing in the President's budget.
        It was developed at NIH, the program was shared by the two
    departments. We get one-third now, and we have for the last 8
    or 9 years. They get two-thirds, but they deal theirs out all
    over the country. One laboratory gets one program, another gets
    another, with reference to chromosomes, and we have made some
    giant strides. I assume you are enthusiastic about the genome
    program, are you not?
        Dr. Krebs. I am very enthusiastic about the genome program.
    I think it is one of the best things that the Department of
    Energy has done over the last 10 to 15 years. Creation of the
    genome program will change the way biology is done in the
    future.
        Senator Domenici. Yes.
        Senator Reid. Mr. Chairman, I had a tour of Lawrence
    Livermore Laboratory, and they had this genome project there. I
    misunderstood, let me make sure, but I had the impression they
    took credit for it, but it was just part they were sharing with
    everybody else.
        Senator Domenici. Yes. They got a chromosome. I do not
    remember which one. They might have two.
        Dr. Krebs. Nineteen, Mr. Chairman.
        Senator Domenici. Which one?
        Dr. Krebs. I think theirs is chromosome 19.
        Senator Domenici. Los Alamos has one, et cetera. It is one
    of many chromosomes, Senator Reid.
        Dr. Krebs. Right.
        Senator Dorgan. Mr. Chairman, this is interesting and a
    history that I was not aware of. I wonder if the staff might be
    able to put together a little briefing memo for us establishing
    the outline of this, because I think you make an excellent
    point. There are a lot of investments we make that people are
    very unaware of, and the origin of these often comes from----
        Senator Domenici. Committees.
        Senator Dorgan [continuing]. Areas of our government, and
    committees, and committee and subcommittee chairs, and so on,
    so that would be very helpful, I think, just to put together a
    briefing.
        Senator Domenici. It will. The staff will combine and get
    it done. Thank you.

                         statement of Dr. Martha Krebs

        Dr. Krebs. May I make a comment before I start my----
        Senator Domenici. Sure. Then you can go to your sermon,
    please?
        Dr. Krebs. Right, my advocacy piece. [Laughter.]
        Actually, the Office of Biological and Environmental
    Research within the Department of Energy has existed for 50
    years, since the time of the Atomic Energy Commission. We have
    a document that celebrates those 50 years that could tell you
    about the work we have done in nuclear medicine, as well as in
    the genome, and I would be happy to provide that in addition to
    whatever the staff might prepare. It is a very exciting story,
    actually.
        [Clerk's note.--The following information ``A Vital
    Legacy,'' Biological and Environmental Research in the Atomic
    Age, by the Office of Biological and Environmental Research,
    U.S. Department of Energy, Internet address is www.er.doe.gov/
    production/ober/ can be found in the subcommittee files.]
        Senator Domenici. What happened, Senator, to the
    predecessor agency, before we had Energy. There was the Atomic
    Energy Commission, and then we had the Energy Research and
    Development Agency [ERDA], and now DOE. It was because of the
    development and use of the atomic weapons, the Department of
    Energy and its predecessors became a primary focal point to try
    to determine the health effects of those two first atomic
    bombs. They were required to keep all kinds of data, and became
    the data experts with reference to hundreds of thousands of
    Japanese people. From that developed the expertise in
    biological and environmental impact.
        They have great biologists in the Department of Energy,
    some of the best in the world, working at the laboratories, is
    that not right?
        Dr. Krebs. Working at the laboratories, also universities,
    the positron emission tomography technology, and the research
    that supports it in everything from addiction to brain tumors,
    a lot of things have come out of the Department of Energy's
    Biological and Environmental Research Program.
        Senator Domenici. Please continue.

                                program overview

        Dr. Krebs. Mr. Chairman, Senator Reid, Senator Dorgan, I am
    delighted to be here this morning to describe the fiscal year
    2000 budget for the DOE science programs. It is important to
    keep in mind that in terms of the Federal investment and basic
    and applied research, DOE is second only to the Department of
    Health and Human Services.
        The Office of Science itself is in a class with the
    National Science Foundation. We are the primary funders of
    physical science in this country, at $1.7 billion, and clearly
    out rank organizations like NASA and the National Science
    Foundation.
        We have a principal role in large scientific user
    facilities, the high energy and nuclear physics accelerators,
    at Fermi, at SLAC, at Jefferson Lab, the Cyclotron sources and
    research reactors for material science and chemistry.
        But significantly, as well, we are an integral part of the
    Department of Energy, both carrying out its science and
    technology missions and commitments through the high energy and
    nuclear physics programs, in what we call a theme of exploring
    energy and matter, and not only are we looking at fundamental
    particles, but also, for example, the building blocks of life,
    like the genome.
        We have a critical role in supporting the energy missions
    of the Department of Energy, as well as the environmental
    missions, in terms of both the consequences of the use and
    production of energy, but also in supporting the cleanup
    mission, understanding how to remove the contamination that has
    been induced at our sites, and then as I noted before, we build
    extraordinary tools to carry out extraordinary science, and we
    get results year after year.

                            program accomplishments

        Let me tell you about some of them. We have had new
    findings this year on corrosion resistance, which will enable
    better protective coatings for high-temperature, high-wear
    environments, such as furnaces, turbines, engines. In the
    exploration of the new world of nano-structures, we have
    created small fibers 50 to 100 times more conductive than
    copper, which could have a major impact in energy utilization.
        Again, in the biological area, as a spinoff of the human
    genome we have been using the genomic technologies to explore
    other organisms. One of them is called D. radiodurans, which we
    call ``Conan the Bacterium.'' It is a thousand times more
    resistant to radiation than humans, and we sequenced its genome
    this past year, and now we are engaged in the systematic
    exploration of its properties.
        We believe there may be long-term use of this organism for
    bioremediation at some of our most contaminated sites, and, in
    fact, the environmental molecular science program, which we
    help the Environmental Management Program to manage jointly, is
    exploring more practical applied applications of this
    mechanism.
        As I mentioned before, most recently we have been using the
    positron emission tomography at the Brookhaven Laboratory to
    explore the chemical pathways of addiction, and this year we
    identified an epilepsy drug, GBG, as a treatment to block the
    addictive effects of cocaine and nicotine. Joanna Fowler, who
    leads that group, was recognized this year with the Lawrence
    Award for her activity.
        Science Magazine named the work of a group at the Lawrence-
    Berkeley Lab on the accelerating universe as the scientific
    breakthrough of the year. It represents a 10-year campaign that
    indicates that there may be a new force in the universe that
    works against gravity, expanding the universe at a faster and
    faster rate.
        Another advance was the first indications of neutrino mass
    at the facility in Japan, but that was strongly supported by
    the United States high energy physics program, and we supported
    most of the U.S. scientists in that collaboration.

                        fiscal year 2000 budget request

        Let me turn to the budget itself now. In fiscal year 2000
    we are requesting $2.8 billion. It is up about $138 million, or
    5 percent, over 1999, taking into account $46 million of one-
    time projects. The overall activity is up about $184 million.
        If you want to think about how we used that additional $184
    million, it was an increase of $84 million for the Spallation
    Neutron Source to keep it on track with the original proposed
    cost profile, $70 million for the Scientific Simulation
    Initiative, part of the President's information technology
    initiative, and a $10 million increase for science education,
    and the remaining is spread in various ways.
        Despite increases for our major initiatives, difficult
    decisions were made within the base program that are
    defensible, but not comfortable. One of them was the example
    that Senator Reid gave of our reductions in geoscience, but
    some accommodations had to be made, given the tight constraints
    that the Administration applied to the budget, and which I know
    you have equally tight constraints as well.
        Within these constraints we have to accommodate new
    projects and new directions, and we have to make sure that we
    balance the operation of existing facilities against that which
    supports the research, and the researchers that use them.
        The budget request has numerous important elements, but in
    the time that remains, I will talk mainly about the two major
    initiatives in the budget, the Spallation Neutron Source and
    the Scientific Simulation Initiative.

                           spallation neutron source

        The Spallation Neutron Source is a $1.36 billion facility,
    expected to be completed in December 2005. It is a five-lab
    collaboration, among Oak Ridge, Argonne, Berkeley, Brookhaven,
    and Los Alamos. It is a high-priority facility for the
    scientific community. It was recommended first in 1984, in the
    National Academy study, and again reconfirmed in the 1999
    material science study by the National Research Council.
        The material impacts are important, but there are also
    other activities that will benefit from this facility. In
    particular, metals, ceramics, polymers, magnetic systems, and
    biological systems as well as molecular structures, and
    understanding the functional properties of biological
    molecules.
        A recent January 1999, review took place that has received
    some fair amount of coverage in the scientific press, but also
    in the House Committee on Science, that made some fairly strong
    criticisms of this project. These criticisms were echoed in
    testimony given by the General Accounting Office, but they only
    confirmed what had been discovered by our review; namely, that
    the technical project director must report to the lab director,
    that the civil construction requires more oversight, and we
    need to prepare a new baseline for the project by July 1999,
    and regain additional cost contingency above what had already
    been regained by the project.
        Within a week of that review, the five lab directors
    identified Dr. David Moncton, from Argonne National Laboratory,
    as the project director. He has been on-site at Oak Ridge and
    working with the technical team for the project, and today they
    are briefing the involved lab directors from the five different
    laboratories on the results of their review, which is
    essentially a stem to stern technical review of the project and
    a commitment to an action plan for the next 6 months to arrive
    at the baseline and to get the project back on track.
        This review will be presented to Under Secretary Moniz
    tomorrow, and we will be presenting it, bringing Dr. Moncton to
    the interested congressional committees and members on Thursday
    and Friday.

                                   gao study

        Senator Domenici. Can I interject here? On the spallation
    machine for Oak Ridge, was the GAO study helpful?
        Dr. Krebs. The GAO study in general confirmed the findings
    of our own review. They were present at our review, by our
    invitation. Additional comments made by the GAO about the
    Department's capability to manage large projects are things we
    have heard before.
        Senator Domenici. You have heard that before?
        Dr. Krebs. Yes.
        Senator Domenici. That was not the question. Was it
    relevant?
        Dr. Krebs. Only insofar as they confirmed what we had
    already found out.
        Senator Domenici. Okay.
        Dr. Krebs. They did not provide any new information. It is
    important for me to also say that Dr. Moncton was responsible
    for the on-time and on-budget delivery of the $800 million
    Advanced Photon Source at the Argonne Lab, so I think he is one
    of the best people we could possibly find to deliver this kind
    of a project.
        I think it also demonstrates the effectiveness of our
    construction management review process that has helped the
    Office of Science deliver projects on time and on budget, such
    as the Relativistic Heavy Ion Collider, the Jefferson Lab, the
    Advanced Photon Source, the Advanced Light Source.
        It demonstrates the workability of the collaboration of the
    five lab directors, but we are going to go further, we will
    negotiate stronger memorandums of agreement and clear
    performance measures for all the labs.

                        scientific simulation initiative

        Let me turn quickly now to the Scientific Simulation
    Initiative, DOE's contribution to the President's information
    technology for the 21st Century. This initiative is aimed at
    providing the science base that will build the computer and
    information technology for the second decade of the next
    century. The National Science Foundation and DARPA have the
    primary responsibility for this science base.
        The Department of Energy and other mission agencies, NOAA,
    NASA, and NIH, are investing in the Tera scale computer and
    software infrastructure under development now for specific
    applications.
        DOE has a special role in that effort. In Defense Programs,
    the Advanced Strategic Computing Initiative [ASCI] is
    developing the trillion-operations-per-second machines and
    intermediate software to enable certification of the safety and
    security of the nuclear stockpile in a comprehensive test ban
    regime.
        It is now foreseeable that tens of Teraops will be
    available in the next decade for science, also the next
    century, but we have to start now developing the algorithms,
    building the models, to match both the capability and the
    structure of these new machines.
        In the Department of Energy, we have two primary
    applications to drive the development on these machines for
    science, climate modeling and combustion. The criteria that we
    use to choose these initiatives were, first of all, we needed
    to have complex scientific problems for which an order of
    magnitude increase in computing would transform the
    understanding of the problem.
        We needed a scientific community comfortable and
    sophisticated about large-scale computing, and finally we had
    externalities that justified prompt development and
    exploitation of the coming technologies. In climate models, as
    you have noted, the need to better understand the impact on a
    regional scale of changes resulting from increased carbon
    dioxide in the atmosphere and in the environment generally is
    an increasingly pressing problem in our negotiations and
    discussions with colleagues around the world. In combustion,
    foreseeable emission limitations that may be the discussion of
    regulations for transportation could present a crisis for
    vehicles in the next decade.
        In sum, DOE has critical scientific problems. We are in the
    middle of the technology development, and the interagency
    collaboration will enable us broad access to the scientific
    community. It is very exciting, and it is relevant. We have a
    lot of other activities that I could talk to you about. Our
    scientific facilities are coming along.
        In addition to bringing on RHIC, the B-factory, the
    Combustion Research Facility at Sandia Livermore, we are also
    in the middle of and working well in our upgrades at LANSCE. We
    are making progress on the Large Hadron Collider. The Next
    Generation Internet is moving along, and in the human genome we
    will be dedicating the production sequencing facility that
    matches some of the new investments at NIH.

                               prepared statement

        Let me just say that in closing, this is a good budget. It
    will enable exciting science. We believe we are managing
    effectively in the face of lots of uncertainties. There is room
    for improvement, and we look forward to working with you.
        Senator Domenici. Do you have prepared remarks?
        Dr. Krebs. I do. I would like to submit them for the
    record, sir.
        Senator Domenici. Your full statement will be made part of
    the record.
        [The statement follows:]

                       Prepared Statement of Martha Krebs

        Mr Chairman and Members of the Subcommittee: This is the sixth time
    I have had the honor of testifying before this subcommittee on behalf
    of the budget for the newly renamed Office of Science (SC). The fiscal
    year 2000 budget request for the Office of Science supports: Basic
    Energy Sciences, Fusion Energy Sciences, High Energy Physics, Nuclear
    Physics, Biological and Environmental Research, Computational and
    Technology Research, Energy Research Analyses, Multiprogram Energy
    Laboratories-Facilities Support, and supporting Science Program
    Direction. The Technical Information Management program budget is
    located within the Energy Supply R&D account. Continued leadership in
    science and technology is a cornerstone of the President's and Vice
    President's vision for America. During the past six years, the
    Administration and this committee have provided substantial growth for
    scientific research and enabling technology programs despite tight
    overall fiscal constraints. This budget request builds upon and
    strengthens those vital investments for the Twenty-first Century.
        Scientific research and the knowledge and technologies that follow
    have been credited with about half of the productivity growth of the
    United States' economy in the past fifty years. What growth it has
    been--millions of high-skill, high-wage jobs; the longest life
    expectancy in human history; agricultural output to confound Malthus;
    new means of working and communicating on a global basis; and exciting
    new frontiers to explore. The Department of Energy, and its predecessor
    agencies, have been a proud sponsor of science-driven growth through
    the combined efforts of the National Laboratories, 66 Nobel Laureates
    and thousands of other outstanding university and industry based
    researchers nationwide. As we begin the Twenty-first Century, we
    prepare for the next fifty years with focused investments in science
    and scientific tools for the future.
        The Department of Energy (DOE) budget for fiscal year 2000 plans
    for the next century by providing for a $138 million increase in the
    Office of Science, to invest in thousands of individual research
    projects at hundreds of research facilities across the U.S., primarily
    in our national laboratories and research universities. The fiscal year
    2000 request will allow for continued construction of the Spallation
    Neutron Source, the first world class neutron source built by the U.S.
    in over 30 years; the pursuit of a new Scientific Simulation Initiative
    that will revolutionize our ability to solve scientific problems of
    extraordinary complexity and enable us to apply these new resources
    toward advancing DOE missions; and participation in the Next Generation
    Internet effort with a focus on R&D and implementation of the
    technologies and tools that help meet mission requirements and
    contribute to the Scientific Simulation Initiative.
                           our mission hasn't changed
        As the Office of Science, our mission remains to: produce the
    scientific and technical knowledge needed to develop energy technology
    options; understand the health and environmental implications of energy
    production and use; maintain U.S. leadership in understanding the
    fundamental nature of energy and matter; provide and operate the large-
    scale facilities required in the natural sciences; ensure U.S.
    leadership in the search for scientific knowledge; and support the
    availability of scientific talent for the next generation.
        Achieving our mission contributes to the goals of the Department
    and the Administration while advancing science and contributing to U.S.
    economic growth. Our history of success continued in fiscal year 1999
    with the following:
        Hundreds of principal investigators, funded by SC, yearly win
    dozens of major prizes and awards sponsored by the President, the
    Department, the National Academy of Sciences, the National Academy of
    Engineering, and the major professional societies including: the 1997
    Nobel Prize for Chemistry; National Medal of Science; Presidential
    Young Investigator Award; 1998 Fermi and Lawrence awards; National
    Science Foundation Career Award; eight 1998 R&D 100 awards; two 1998
    Discover Awards; 1998 Federal Laboratory Consortium Award; Gordon Bell
    Prizes and Fernbach Award; IBM's Supercomputer Award; and many other
    awards and honors from scientific societies.
        Researchers supported by the Office of Science showed that the
    universe is not only expanding but that the outward motion appears to
    be speeding up, not slowing down. The implication is that Einstein was
    right when he suggested that there is a mysterious energy that fills
    ``empty'' space and that most of the energy of the universe is in this
    form. The finding raises profound questions about the nature of space
    and the ultimate fate of the universe including fundamental new
    questions for physics. As a result, Science Magazine named The
    Accelerating Universe ``the 1998 Breakthrough of the Year ''.
        SC also provided support for the $100 million detector, Super-
    Kamiokande, operated by a collaboration of 120 physicists from 23
    institutions headed by the University of Tokyo's Institute for Cosmic
    Ray Research (ICRR). This experiment demonstrated that the supposedly
    massless neutrino must, in fact, have a non-zero rest mass. Once
    verified, this discovery will force a revision in the Standard Model,
    which assumes a massless neutrino and may alter our estimates of the
    total mass of the universe, with implications for understanding its
    origin and eventual fate.
        Incredibly light synthetic metals with a potential electrical
    conductivity 50-100 times better than copper per weight are being made
    from carbon nanotubes doped with metals. First discovered in 1991,
    nanotubes are a new class of materials formed from graphite-like sheets
    of carbon rolled into exquisitely small cylinders (one-billionth of a
    meter).
        Microbial genomics, one of today's most exciting and high profile
    fields in biology, was initiated by DOE in 1994. Science Magazine also
    identified microbial genomics as one of the top 10 fields of discovery
    in 1998. Two of the 1997 ``11 hottest papers in biology'' were for
    microbial genomic sequences funded by SC. For example, SC research on
    ``Conan the Bacterium''--D. radiodurans R1, has shown extreme
    resistance to genotoxic chemicals, oxidative damage, high levels of
    ionizing and UV radiation, and desiccation. The ability to survive such
    extreme environments is attributed in part to a unique DNA repair
    system in combination with its chromosome copy number and structure.
    The remarkable capabilities of this microbe may enable scientists to
    engineer a form of D. Radiodurans that can help us clean up some of our
    most troublesome waste problems.
        The Human Genome Program was initiated by the Department of Energy
    (DOE) in 1986 to map and determine the complete DNA sequence of the
    human genome. A Memorandum of Understanding was established with the
    National Institutes of Health (NIH) in 1988 to coordinate the U.S.
    Genome Project. The latest joint five-year plan was published in
    Science Magazine in October 1998. This plan calls for determining the
    complete sequence of the human genome by the year 2003, two years ahead
    of the original target date. Recent successes include identifying the
    gene for kidney disease.
        SC has renewed our commitment to forging more effective
    partnerships that leverage our research investments and connect us more
    closely with other federal science programs and the direct
    beneficiaries of our research. We are fostering new kinds of
    partnerships among our national laboratory, university and industry
    based researchers to maximize the effectiveness and impact of research
    activities. In partnership with the Department's applied programs, SC
    is also working to bridge the gap between basic research and
    application through: joint planning of critical long-term research;
    joint solicitations and funding of targeted research efforts; and
    annual integration workshops that bring together program managers and
    researchers from across DOE.
        New scientific research facilities coming on-line include: the
    William R. Wiley Environmental Molecular Sciences Laboratory; the
    Jefferson Lab's Large Acceptance Spectrometer; SLAC's B-Factory, the
    Oak Ridge Free-Air CO2 Enrichment Facility, the JGI Production (DNA)
    Sequencing Facility and the Relativistic Heavy Ion Collider (RHIC).
    Initiation of RHIC operations in fiscal year 2000 opens an exciting new
    era of nuclear physics studies: the behavior of hot, dense nuclear
    matter and an expected new state of matter, the quark-gluon plasma.
    Projects completed on time and budget include: Fermilab's Main
    Injector, and the Combustion Research Facility Phase II.
        Bringing science to the researcher's desktop became a reality as
    over 30,000 technical reports (2 million full-text pages) of DOE's R&D
    results became accessible and searchable over the World Wide Web via
    the Information Bridge (www.doe.gov/bridge). Researchers are regularly
    downloading 4,000 reports per week from this web site.
        The Department of Energy is a science agency because its mission
    and goals require technologies and scientific knowledge far beyond that
    which is currently available. From safeguarding the nuclear stockpile
    to ensuring our nation's energy supply for the next century, DOE
    continues to challenge the frontiers of science and technology.
        The DOE Strategic Plan outlines the vision, goals and strategic
    objectives that will, through leadership in science and technology,
    help the DOE to meet those challenges. In keeping with the Government
    Performance and Results Act (GPRA), the Office of Science fiscal year
    2000 budget request includes program specific goals, strategies, and
    measures that focus our research activities and ensure continuity with
    Departmental plans and national goals.
                      rethinking our goals and strategies
        In the past year, the Department has begun to rethink how we
    characterize our R&D efforts across business lines to assemble the key
    information for improving our analysis and management of these
    investments. The result is a set of R&D Portfolios, scheduled for
    public release this month, that capture the spectrum of DOE R&D efforts
    in each Business Line.
        The basic research of the Office of Science presses forward on the
    frontiers of fundamental understanding but also supports and enables
    the R&D of the other business lines. Thus, a Science Portfolio has been
    developed so as to clarify and improve the integration of our program
    results in the Department. As the Department R&D Portfolios evolve, the
    Office of Science will continue to integrate basic research with the
    applied R&D in the other business lines' Portfolios to ensure strong
    linkages between technology needs and science.
        A revised Strategic Plan of the Office of Science, also scheduled
    for release at the end of the month, will articulate the long-range
    vision, goals, objectives, and strategies for our programs. The Science
    Portfolio complements and supports the Strategic Plan by providing a
    near-term ``snapshot'' of our investments that dovetails with the new
    strategic framework.
        The motivations behind this planning effort are to develop a shared
    long-term focus for SC programs, their scientific communities and
    performers; to describe our present scientific programs and position
    them for the future; to provide a framework for cooperation and risk
    taking; to illustrate the unique and coordinated role of SC programs
    within the DOE and the federal science investment; and to inform and
    inspire our sponsors and the general public.
        The new SC Strategic Plan, and supporting Science Portfolio, is
    structured around five high-level goals with twelve strategic
    objectives, listed in Figure 1. These goals were developed through a
    series of planning activities and workshops that drew on the experience
    and knowledge of our research scientists and stakeholders to capture
    both what is necessary and what is possible for our science as we look
    to the next century.
        The first goal, Fueling the Future, is centered on science for
    affordable and clean energy options for the future. Some of the
    questions that motivate this goal are: How can we tap and harness
    affordable, clean fuels? What clean new electric power systems will
    fuel the future? and How can energy systems be made more efficient and
    environmentally sound?
        Development of this goal has been closely connected with the
    development of the Energy R&D portfolio and the objectives directly map
    onto the energy portfolio.
      --Fueling the future: New fuels; clean and affordable power; and
            efficient energy use.
      --Protecting our living planet: Sources and fate of energy by-
            products; impacts on people and the environment; and prevention
            and protection.
      --Exploring energy and matter: Components of matter; origin and fate
            of the universe; and complex systems.
      --Extraordinary tools for extraordinary science: Instrumentation for
            the frontiers of science; scientific simulation; and
            institutional capacity.
      --Enabling world class science.
        The second goal, Protecting our Living Planet, is centered on
    understanding energy impacts on people and the biosphere. Some of the
    questions that motivate this theme are:
      --What are the sources and fate of energy-related by-products?
      --What factors affect global climate and how can they be controlled?
            and
      --How do complex biological and environmental systems respond to our
            energy use?
        This goal also contributes to both the Energy R&D portfolio and the
    Environmental R&D portfolio.
        The third goal, Exploring Matter and Energy, is centered on
    discovering the building blocks of atoms and life. Some of the
    questions that motivate this theme are:
      --What are the fundamental components of matter?
      --How can the origin and fate of the Universe reveal the secrets of
            energy, matter and life? and
      --How do atoms and molecules combine to form complex dynamic systems?
        This goal captures the most fundamental research in the Office of
    Science. The complex systems question links to R&D efforts in all of
    the DOE business lines.
        The fourth goal, Extraordinary Tools for Extraordinary Science, is
    centered on the national assets that DOE provides for forefront,
    multidisciplinary research. This goal builds on the unique role of the
    Office of Science in providing the nation with forefront research
    facilities at our National Laboratories such as research accelerators,
    reactors, computational centers, and other unique instrumentation. In
    addition, the National Laboratories as a system of institutions is
    increasingly becoming an extraordinary tool beyond the set of specific
    facilities located on their sites. The Office of Science will continue
    to ensure that these critical research tools remain accessible to peer
    reviewed researchers from all across the nation and meet the technical
    challenges of forefront scientific investigation. This goal looks to
    the future and to training and educating the next generation of
    scientists and engineers.
        Some of the questions that motivate this goal are:
      --How can we explore the frontiers of the natural sciences?
      --How can we predict the behavior of complex systems? and
      --How can we strengthen the nation's capacity for multidisciplinary
            science?
        This goal enables research in all of the DOE business lines. By
    organizing future facility needs, as identified by the scientific
    community, this theme ensures that America's research capability will
    remain both accessible and state of the art.
        The fifth goal, Enabling World Class Science, conveys the
    commitment of DOE and National Laboratory staff to continuously improve
    their operational processes. Of paramount importance is the selection
    and conduct of excellent, productive science that is carried out safely
    and with care for the environment and involvement of local communities.
         implementing the strategies--initiatives for fiscal year 2000
        The five goals provide a framework for current programs and a
    platform for future efforts. Fiscal year 2000 initiatives and
    priorities that support these goals include: utilizing the advances in
    computation that are flowing from the Accelerated Strategic Computation
    Initiative (ASCI) to aid scientific research in critical complex areas
    as part of The President's Information Technology for the Twenty-first
    Century (IT2); continuing progress made toward returning
    U.S. International Leadership in Neutron Science; carefully managing
    our partnership in the Large Hadron Collider; ensuring wide utilization
    of our Scientific User Facilities; developing and applying DOE
    applications and technologies for the Next Generation Internet;
    providing the scientific basis for DOE's Climate Change Technology
    Initiative; and providing unique services in the exploding field of
    Genome Research. Figure 2 depicts the cross-connection between the
    goals above and the priorities in the fiscal year 2000 request.
    [GRAPHIC] [TIFF OMITTED] T10AP13.004

        Scientific Simulation Initiative.--It is now possible to obtain
    computational capabilities 100 times faster than currently in common
    use through the application of technologies developed for the
    Accelerated Strategic Computing Initiative (ASCI). Therefore the
    Department of Energy, in coordination with the National Science
    Foundation and other federal science programs, has developed a
    Scientific Simulation Initiative (SSI) in support of the President's
    Information Technology for the Twenty First Century (IT2)
    Initiative. The purpose of the SSI is to further develop and employ an
    emerging generation of very high performance computers as major tools
    for scientific inquiry. These resources will revolutionize our approach
    to solving complex problems in such areas as energy, the environment,
    and fundamental research. This initiative will require close
    collaboration between scientists in many disciplines: chemistry, fluid
    flow, global systems, mathematics, computer science, etc. However, it
    is important to remember that this is a research program and that even
    the operation of computing facilities at this scale presents
    significant research issues.
        Within the Office of Science, the SSI will be an integrated effort
    with the Computational and Technology Research (CTR) program
    coordinating and overseeing competitive, peer reviewed selections of
    sites for computational centers and basic science applications. In
    addition, CTR will manage the leading edge research programs in
    computer science and enabling technologies which will be required to
    transform the SSI computing and communications facilities into tools
    for science. The element of the program that addresses enabling
    hardware and software will be directed by a joint SC/Defense Programs
    ASCI effort. The management of the research programs required to use
    these facilities for scientific discovery will be led by the
    appropriate programs within the Office of Science: Basic Energy
    Sciences for Combustion; Biological and Environmental Research for
    Global Systems; and the Offices responsible for the scientific
    disciplines selected in the basic science applications competition.
        The first scientific applications to be run on these new massively
    parallel computers have been chosen carefully. Combustion and global
    systems are complex scientific problems for which terascale computing
    will provide a transformation in our level of understanding. The
    scientific communities in these areas are also experienced in using
    computational tools. Finally, these two problems are central to DOE's
    mission.
        Combustion.--Currently, eighty-five percent of U.S. energy use is
    derived from the combustion of fossil fuels and this dependence on
    combustion is not likely to change in the coming decades. Combustion
    remains one of the primary causes of lowered air quality in urban
    environments. At present, engineers have neither sufficient knowledge
    nor the computational tools to understand and predict the chemical
    outcome of combustion processes with any degree of practical
    reliability. Existing models that guide the design process are of very
    limited usefulness because of the extraordinary complexity of the
    combustion process. With very high end computing resources and a
    concerted research program in combustion modeling, we can develop the
    next generation of combustion modeling tools for accelerated design of
    combustion devices meeting national goals of emission reduction and
    energy conservation.
        Global Systems.--Unlike many disciplinary areas of research, the
    complex workings of the global environmental system cannot be studied
    in a laboratory setting. The integration of knowledge from the many
    disciplines that together describe the global system can only be
    performed in computer simulation models. It is only through such
    general circulation models that it is possible to understand current
    climate and climate variability and to predict future climate and
    climate variability, including prediction of the possible effects of
    human activities on the global system. Advances in scientific
    understanding are therefore predicated upon the successful development
    of modeling tools to keep pace with the rapid advances in the quality
    and quantity of data available. These tools will lead to the
    development of detailed fully coupled global system models that
    accurately reproduce, and ultimately predict, the behavior of the
    interacting components of the system, i.e. the global atmosphere, the
    world ocean, the terrestrial land surface and both glacial and sea ice.
        Fundamental Research.--Whereas the scientific accomplishments of
    this century have resulted in seeking and understanding the fundamental
    laws that govern our physical universe, the science of the coming
    century will be characterized by synthesis of this knowledge into
    predictive capabilities for understanding and solving a wide range of
    scientific problems, many with practical consequences. In this
    endeavor, the computer will be a primary instrument of scientific
    discovery. Many areas of scientific inquiry, critical to the
    Department's mission, will be advanced dramatically with access to
    high-end computation--including, but not limited to, materials
    sciences, structural genomics, high energy and nuclear physics,
    subsurface flow, and fusion energy research.
        The Spallation Neutron Source (SNS).--The importance of neutron
    science for fundamental discoveries and technological development has
    been enumerated in all of the major materials science studies over the
    past two decades, including a major study by the National Research
    Council entitled ``Major Facilities for Materials Research and Related
    Disciplines'' (Seitz-Eastman Report).
        As the needs of our high-technology society have changed, so has
    the way in which we conduct the R&D that helps us to meet those needs.
    It has become increasingly important to develop new materials that
    perform under severe conditions and yet are stronger, lighter, and
    cheaper. Major research facilities are used to understand and
    ``engineer'' materials at the atomic level so that they have improved
    macroscopic properties and perform better in new, demanding
    applications. The SNS is a next-generation facility for these types of
    applications. Neutron scattering will play a major role in all forms of
    materials design and understanding. This research will lead to the
    development of advances such as: smaller and faster electronic devices;
    lightweight alloys, plastics and polymers for transportation and other
    applications; magnetic materials for more efficient motors and for
    improved magnetic storage capacity; improved understanding of form and
    function in biological structures and the development of new drugs for
    medical care. Upon completion, the SNS will be the world's most
    powerful neutron source, accommodating more than 1,000 researchers and
    30 to 40 special purpose instruments.
        The SNS Total Project Cost (TPC) is estimated to be $1,360 million
    over a 7.25-year schedule. Throughout the life of the project, semi-
    annual reviews will track cost and management fiscal year 1999 funding
    provides for the start of Title I design activities, initiation of
    subcontracts and long-lead procurement, and continued R&D to reduce
    technical and schedule risks. The fiscal year 2000 budget request of
    $214 million would support Title II (detailed) design for the technical
    components and control systems. Construction, on some of the
    conventional facilities, is scheduled to begin in fiscal year 2000
    along with the procurement of key technical equipment.
        The SNS project is an example of DOE's commitment to use the DOE
    laboratories as a system. Oak Ridge National Laboratory is responsible
    for the project with participation from Lawrence Berkeley National
    Laboratory, Los Alamos National Laboratory, Brookhaven National
    Laboratory, and Argonne National Laboratory. The laboratories have been
    working together in an increasingly effective manner and R&D is
    proceeding smoothly with no technical barriers in sight.
        In January 1999, an Office of Science construction management
    review of the SNS made recommendations with respect to the project
    director and staff experienced in the oversight and integration of all
    aspects of the large complex project. The Laboratory Director has hired
    a new Associate Laboratory Director for the project and is assembling
    the necessary senior management team. As a first step, I tasked the
    laboratory to undertake a comprehensive assessment of the project. The
    assessment is due to the Department in the first week in April. These
    construction management reviews have been a key tool for keeping SC
    projects on time and on budget. The prompt action in response to the
    review's recommendations will allow us to deliver the SNS as well.
        Scientific Facilities Utilization.--This fiscal year 2000 budget
    request continues to strongly support Scientific Facilities Utilization
    in the following programs: Basic Energy Sciences, High Energy Physics,
    Nuclear Physics, Fusion Energy Sciences, Biological and Environmental
    Research, and Computational and Technology Research. Each year, over
    15,000 university, industry, and government sponsored scientists
    conduct cutting edge experiments at these particle accelerators, high-
    flux neutron sources, synchrotron radiation light sources, and other
    specialized facilities, such as the Combustion Research Facility (CRF)
    at Sandia National Laboratories, Livermore, California. The CRF is an
    internationally recognized facility for the study of combustion science
    and technology, which will begin its first year of operation after its
    Phase II development project. The user community continues to be
    pleased with the results of the Science Facilities Initiative as
    evidenced by their many letters of support and by the positive results
    of surveys conducted at the facilities.
        The Large Hadron Collider.--The foremost high energy physics
    research facility of the next decade will be the Large Hadron Collider
    (LHC) at CERN, the European Center for Particle Physics. The primary
    physics goals of the LHC will impact our understanding of the relation
    of mass, fundamental forces, and the structure and origin of the
    universe. U.S. participation in the LHC is required to provide U.S.
    access to the high energy frontier in order to maintain the U.S. as a
    world leader in this fundamental area of science.
        The LHC is an outstanding example of international cooperation in
    large scientific projects, as well as interagency and inter-laboratory
    cooperation. An International Cooperation Agreement has been negotiated
    between CERN, DOE and NSF. The Agreement provides for U.S.
    participation in the construction of the accelerator, and of the two
    very large detectors, ATLAS and CMS. Carefully defined lists of
    deliverables and costs have been agreed upon for each of these areas of
    participation. U.S. costs are capped at $531 million ($450 million DOE
    and $81 million NSF), consistent with Congressional guidance. In
    return, participating U.S. universities and laboratories will join, as
    full partners, in LHC experiments. In addition, a Memorandum of
    Understanding (MOU) has been executed between DOE and NSF that defines
    the relationship between the agencies relative to programmatic
    coordination of U.S. LHC activities including joint oversight and
    execution of the U.S. LHC Construction Program.
        Under the terms of this MOU, Fermilab is the Lead Laboratory for
    the accelerator portion of the program, which it will execute in
    cooperation with Brookhaven (BNL) and Lawrence Berkeley (LBNL) National
    Laboratories. BNL is the host laboratory for the ATLAS portion of the
    program, which also involves Argonne National Laboratory (ANL) and LBNL
    along with 28 university groups. Similarly, Fermilab is the host
    laboratory for the CMS detector portion of the program, along with 33
    university groups. Cost and schedule baselines have been reviewed and
    validated for each of the three programs and management systems are in
    place to monitor progress against baselines.
        The Next Generation Internet (NGI).--The program is creating the
    foundation for more powerful and versatile networks of the Twenty-first
    century, just as previous federal investments in information technology
    R&D created the foundation for today's Internet. This program is
    critical to DOE's science and technology missions because enhancements
    to today's Internet from commercial R&D will not be sufficient to
    enable: effective use of petabyte/year (would fill the hard drives of
    millions of today's desktop PCS) High Energy and Nuclear Physics
    facilities such as the Relativistic Heavy Ion Collider (RHIC); remote
    visualization of terabyte to petabye data sets from computational
    simulation; development of advanced collaboratories; and effective
    remote access to tomorrow's advanced scientific computers.
        For example, typical RHIC experimental collaborations involve
    hundreds of scientists at dozens of institutions across the country and
    the world. Using the current Internet, it would take about 2,500 hours
    to transmit one day's data from RHIC to one remote site for analysis.
    Using NGI it would take 25 hours.
        Thus, DOE's NGI research program is focused on discovering,
    understanding, developing, testing and validating the networking
    technologies needed to enable wide area, data intensive and
    collaborative computing. The DOE applications share two important
    characteristics. They all involve extremely large data sets and they
    all require that scientists be able to interact with the data in
    (nearly) real time. Current network technology limitations
    significantly limit our ability to address these characteristics.
        The DOE program includes research in advanced protocols, special
    operating system services for very high speed, and very advanced
    network control, the components needed to enable wide area, data
    intensive and collaborative computing. In addition the DOE program
    addresses issues that result from the many different kinds of network
    devices, network-attached devices, and services that need to be
    integrated together. Examples of the components and services that need
    to be integrated include: network resources, data archives on tape,
    high performance disk caches, visualization and data analysis servers,
    authentication and security services, and the computer on a scientist's
    desk. This type of integration, as well as the issues of improving the
    performance of the individual components, all require significant
    research because the issues are currently not well understood. Indeed,
    the first identification of many of these issues is the result of
    previous work in collaboratories and visualization supported by DOE.
        Thus, DOE's participation in the NGI builds on previous DOE
    research and its over two decades of success in using advanced networks
    as tools for science. Furthermore, the differences between the
    requirements of commercial networks and networks for scientific
    research require DOE to conduct this research because these tools and
    technologies will not be developed by commercial R&D. However, the
    results and ``spinoffs'' of this research, after testing and
    prototyping by the scientific community, will impact broad commercial
    use of networks. DOE's fiscal year 2000 NGI program will build on the
    results of the competitive research solicitations conducted in fiscal
    year 1999.
        Climate Change Technology Initiative (CCTI).--Eighty-five percent
    of our Nation's energy results from the burning of fossil fuels, a
    process that adds carbon to the atmosphere. Because of the potential
    environmental impacts of increases in atmospheric carbon dioxide,
    carbon management has become an international concern and is a focus of
    the CCTI.
        The Office of Science is well positioned to make significant
    contributions to the many solutions needed to address this problem. SC
    can build on the fundamental discoveries of core research programs in
    carbon and non-carbon energy sources, carbon sequestration, and carbon
    recycling, extending them to the new discoveries needed to make carbon
    management practical and efficient.
        Activities in both Basic Energy Sciences and Biological and
    Environmental Research support the DOE and Administration CCTI efforts
    in: science for efficient technologies; fundamental science
    underpinning advances in all low/no carbon energy source; and
    sequestration science.
        The SC portion of the CCTI leverages the foundation of excellent
    research already underway. The additional SC effort will also have a
    major impact on many scientific disciplines by advancing the state of
    knowledge in such fields as genome science, molecular, cellular and
    structural biology, biochemistry, chemical dynamics, solid state
    chemistry, photochemistry, ecology, nano- and meso-phase materials
    science, condensed matter physics, engineering, theoretical chemistry
    and physics.
        For example, the BER microbial genome program has made significant
    investments in the technology that enables genome sequencing at rates
    previously unattainable. Capitalizing on these investments, the genomes
    of microbes that produce methane and hydrogen from carbonaceous sources
    will be sequenced as part of the first awards under CCTI. This will
    enable identification of key genetic components of the organisms that
    regulate the production of these gases. The carbon sequestration
    research program will focus on understanding the natural terrestrial
    sequestration cycle and the natural oceanic sequestration cycle as part
    of the first awards under the CCTI. The ultimate goal is to enhance the
    natural carbon cycle in both the terrestrial and oceanic systems. The
    search for new fuel sources and carbon sequestration research are key
    elements of the carbon management science program.
        CCTI research and related activities within the Office of Science
    will continue to be coordinated with the Office of Fossil Energy.
    Fiscal year 1999 integration efforts include the coordination of new
    CCTI proposal solicitations and preparation of a detailed carbon
    dioxide sequestration roadmap.
        Genome.--In its first full year of operation, the DOE Joint Genome
    Institute (JGI) became a leading producer of high quality human DNA
    among U.S. sequencing centers. The JGI is scaling up its sequencing
    capacity from 21 million finished bases in fiscal year 1998 to 30
    million finished bases and 40 million high quality draft bases in
    fiscal year 1999. In total, SC will complete sequencing of 50 million
    finished and 70 million high quality draft subunits of human DNA to
    submit to publicly accessible databases in fiscal year 2000. In
    addition, SC will complete the full genetic sequencing of more than 10
    microbes that have significant potential for waste cleanup and energy
    production.
        Improvements in high throughput human DNA sequencing technology and
    sequence data management are needed to complete the first human genome
    by 2003 and to efficiently and cost effectively use that sequence
    information for future medical diagnoses and scientific discovery. The
    Joint Genome Institute, in which the National Laboratories work as a
    system, are primarily focused on high throughput sequencing. Fiscal
    year 2000 is the third year of a major 3-5 year scale-up in DNA
    sequencing capability for this virtual institute. DOE will continue to
    work with the private sector, where appropriate, to accelerate progress
    and reduce cost in the Human Genome project. The SC program is actively
    involved with other federal agencies funding, human, plant and
    microbial research to encourage effective and efficient management of
    the total federal genome research portfolio. Genomics is the foundation
    for future biological research and is the reason that the next century
    has been called ``the century of biology.''
        Program Direction.--The Science Program Direction budget funds the
    staff and related expenses that are necessary to develop, direct and
    administer a complex and broadly diversified program of mission-
    oriented basic and applied research. The Office of Science continues to
    achieve technical excellence in its programs despite managing one of
    the largest and most diversified and complex basic research portfolios
    in the Federal Government with a relatively small Federal and support
    contractor staff compared to other programs both within and outside the
    Department and will strive to meet staffing levels as outlined in its
    Workforce Management Plan. Enhanced business processes that are built
    from our Activity Based Management activities and Strategic Information
    Planning will enable the staff to carry out the mission and functions
    of the organization effectively and efficiently. Work will continue on
    piloting the transfer of management responsibility of newly generated
    wastes at SC sites from Environmental Management to the Office of
    Science. I am proud to recognize SC efforts that have resulted in:
    lower prior year uncosted balances; reduced unnecessary duplication
    through external peer review; support for new initiatives, such as the
    Scientific Simulation Initiative (SSI); and more than six years of on-
    time, on-budget construction projects due to an effective SC
    construction management review program that has been recognized by both
    the Government Accounting Office (GAO) and the National Association of
    Public Administrators (NAPA).
        The scientific and technological challenges of the Department's
    missions demand an adequate supply of scientists, engineers and
    technicians. For over 50 years, DOE and its predecessor agencies have
    supported science and engineering education programs involving
    university faculty as well as pre-college teachers and students.
    Tapping the significant human and physical resources of the DOE
    National Laboratories is perhaps the most distinguishing feature of the
    agency's contribution to science education. Within the fiscal year 2000
    request for Program Direction is SC's core program for science
    education, supporting such activities as: the Undergraduate Research
    Fellowship Program, the National Science Bowl, and the Albert Einstein
    Distinguished Educator Fellowship. In addition, two new initiatives,
    developed in partnership with NSF, will be supported through the five
    SC scientific programs. The first initiative will be focused on
    providing pre-college science and math teachers with research
    opportunities that will improve their knowledge and skills of
    scientific discovery and enhance their ability to apply them in their
    classrooms. The second initiative will allow university faculty and
    undergraduate student teams to participate in long-term research
    projects at DOE Laboratories. Historically, over two-thirds of
    undergraduates who have participated in DOE programs have gone on to
    graduate school in disciplines directly related to DOE missions. These
    activities will help to fulfill SC's responsibilities in developing the
    next generation of scientists and engineers and to address the daunting
    demographic trends that suggest these new scientists will have to come
    from the ranks of women and minorities, two groups traditionally under-
    represented in scientific fields.
                    science programs--basic energy sciences
    Fiscal Year 1999 Appropriation--$799.5 M; Fiscal Year 2000 Request--
            $888.1 M
        The Basic Energy Sciences (BES) program is one of the Nation's
    primary sponsors of fundamental research in materials sciences,
    chemical sciences, geosciences, plant and microbial sciences, and
    engineering sciences. Performance measurement helps determine the
    distribution of activities supported within BES. All BES research
    programs undergo rigorous peer evaluation through competitive grant
    proposals, program reviews, and advisory panels. The program funds more
    than 2,400 researchers at 200 institutions nationwide. BES-supported
    research also underpins the Department of Energy missions in energy,
    the environment, and national security. Strategic directions are set
    through working relationships with other DOE programs, research
    workshops with public and private scientific communities nationwide,
    and policy directives.
        Within the base research effort in fiscal year 2000, a program in
    Complex and Collective Phenomena will continue to support work at the
    frontiers of basic research that hold the promise of delivering
    revolutionary breakthroughs. This effort is designed to obtain
    fundamental knowledge of increasingly complex systems in order to help
    bridge the gap in our understanding between the atomic and molecular
    properties and the bulk structural and mechanical properties of
    materials, for example. In addition, BES will continue its Partnership
    for Academic-Industrial Research (PAIR) program to facilitate research
    partnerships between academic researchers, their students, and
    industrial researchers.
        In fiscal year 2000, BES also plays a major part in the Climate
    Change Technology Initiative (CCTI) and the Scientific Simulation
    Initiative (SSI). The BES research under CCTI will primarily focus on
    carbon recycling, improved efficiency in the use of fossil carbon
    energy sources, and new and improved non-carbon energy sources.
    Examples of the types of research areas in each of the four BES
    subprograms are: high-temperature materials for more efficient
    combustion; electrochemical energy storage; mechanical stability of
    porous and fractured reservoirs/aquifers; and the biological process of
    photosynthesis. The BES research under SSI includes Combustion Systems
    Integrated Applications, an integrated effort bringing together
    computational and communication resources, focused research in
    scientific disciplines, and research in computer science and other
    enabling technologies to solve the complex problems that characterize
    DOE's scientific research needs.
        In addition to directly supporting research performers, BES is also
    the steward of 17 major national user facilities. Included among these
    facilities are the four major synchrotron radiation light sources, four
    high-flux neutron sources, and a number of specialized facilities for
    electron beam microcharacterization, materials synthesis and
    processing, combustion research, pulsed radiolysis, and ion beam
    studies. The facilities are planned in collaboration with the
    scientific community and permit scientists to carry out forefront
    experiments that cannot be done in any other way. A major part of the
    fiscal year 2000 BES budget request is for the continuation of the
    Spallation Neutron Source project to provide the Nation with a next-
    generation short-pulse spallation neutron source for neutron scattering
    and related research in broad areas of the physical, chemical,
    materials, biological, and medical sciences.
        BES scientific user facilities enable researchers to gain the new
    knowledge necessary to achieve the Department's missions and, more
    broadly, to advance the Nation's entire scientific enterprise. The
    number of scientists conducting research at the BES user facilities has
    grown dramatically in recent years. BES user facilities are open to all
    qualified investigators in academia, industry, and government
    laboratories on a no-charge basis to all qualified researchers whose
    intention is to publish in the open literature. Over 6,000 users were
    accommodated at the BES scientific user facilities in fiscal year 1998.
    These facilities have an enormous impact on science and technology,
    ranging from determinations of the structure of superconductors and
    biological molecules to the development of wear-resistant prostheses,
    from atomic-scale characterization of environmental samples to
    elucidation of geological processes, and from the production of unique
    isotopes for cancer therapy to the development of new medical imaging
    technologies.
        Materials Sciences.--The Materials Sciences subprogram supports
    basic research in condensed matter physics, metals and ceramics
    sciences, and materials chemistry. This basic research seeks to
    understand the atomistic basis of materials properties and behavior and
    how to make materials perform better at acceptable cost through new
    methods of synthesis and processing. Basic research is supported in
    corrosion, metals, ceramics, alloys, semiconductors, superconductors,
    polymers, metallic glasses, ceramic matrix composites, catalytic
    materials, non-destructive evaluation, magnetic materials, surface
    science, neutron and x-ray scattering, chemical and physical
    properties, and new instrumentation. Ultimately the research leads to
    the development of materials that improve the efficiency, economy,
    environmental acceptability, and safety in energy generation,
    conversion, transmission, and use. These material studies affect
    developments in numerous areas, such as the efficiency of electric
    motors and generators; solar energy conversion; batteries and fuel
    cells; stronger, lighter materials for vehicles; welding and joining of
    materials; plastics; and petroleum refining.
        Chemical Sciences.--The Chemical Sciences subprogram has two major
    components. The disciplinary areas within each component are connected
    to and address needs of the principal DOE and BES mission goals and
    objectives. One major component is comprised of atomic, molecular and
    optical physics; chemical physics; photochemistry; and radiation
    chemistry. This research provides a foundation for understanding
    fundamental interactions of atoms, molecules, and ions with photons and
    electrons. This work also underpins our fundamental understanding of
    chemical reactivity. This, in turn, enables the production of more
    efficient combustion systems with reduced emissions of pollutants. It
    also increases knowledge of solar photoconversion processes resulting
    in new, improved systems and production methods. The other major
    component of the research program is comprised of inorganic chemistry,
    organic chemistry, analytical chemistry, separations science, heavy
    element chemistry, and aspects of chemical engineering sciences. The
    research supported provides a better molecular level understanding of
    homogeneous and heterogeneous reactions occurring at surfaces,
    interfaces, and in bulk media. This has resulted in improvements to
    known heterogeneous and homogeneous catalytic systems and to new
    catalysts for the production of fuels and chemicals, better analytical
    methods in a wide variety of applications in energy processes and
    environmental sciences, new knowledge of actinide elements and
    separations important for environmental remediation and waste
    management, and better methods for describing turbulent combustion and
    predicting thermophysical properties of multicomponent systems.
        Engineering and Geosciences.--The Engineering and Geosciences
    subprogram conducts research in two disciplinary areas, engineering and
    geosciences. In Engineering Research, the goals are to extend the body
    of knowledge underlying current engineering practice to create new
    options for improving energy efficiency and to broaden the technical
    and conceptual knowledge base for solving the engineering problems of
    energy technologies. In Geosciences Research, the goal is on
    fundamental knowledge of the processes that transport, concentrate,
    emplace, and modify the energy and mineral resources and the byproducts
    of energy production. The research supports existing energy
    technologies and strengthens the foundation for the development of
    future energy technologies. Ultimately the research impacts control of
    industrial processes: to improve efficiency and reduce pollution; to
    increase energy supplies; and to lower cost and increase the
    effectiveness of environmental remediation of polluted sites.
        Energy Biosciences.--The Energy Biosciences subprogram supports
    mechanistic research on fundamental biological processes related to
    capture, transformation, storage and utilization of energy. The
    research focuses on plants and non-medical microorganisms to form a
    broad scientific foundation for support of Department of Energy's goals
    and objectives in energy production, environmental management, and
    energy conservation. Basic research on plants includes photosynthetic
    mechanisms and bioenergetics in algae, higher plants, and
    photosynthetic bacteria; control mechanisms that regulate plant growth
    and development; fundamental aspects of gene structure, function, and
    expression; plant cell wall structure, function and synthesis; and
    mechanisms of transport across membranes. Research supported in these
    areas seeks to define and understand the biological mechanisms that
    effectively transduce light energy into chemical energy, to identify
    the biochemical pathways and genetic regulatory mechanisms that can
    lead to the efficient biosynthesis of potential fuels and petroleum-
    replacing compounds, and to elucidate the capacity of plants to
    remediate contaminated environments by transporting and detoxifying
    toxic substances. The research focus in the microbiological sciences
    includes the degradation of biopolymers such as lignin and cellulose,
    anaerobic fermentations, genetic regulation of microbial growth and
    development, thermophily, e.g., bacterial growth under high
    temperature, and other phenomena with the potential to impact
    biological energy production, conversion and conservation. Organisms
    and processes that offer unique possibilities for research at the
    interface of biology and the physical, earth and engineering sciences
    are also studied.
                     biological and environmental research
    Fiscal Year 1999 Appropriation--$436.7 M; Fiscal Year 2000 Request--
            $411.2 M
        For over 50 years, the Biological and Environmental Research (BER)
    program has been bringing revolutionary solutions to energy-related
    biological and environmental challenges. Through its support of peer-
    reviewed research at the Department's national laboratories,
    universities, and private institutions, the program develops the
    fundamental knowledge needed to identify, understand, and anticipate
    the long-term health and environmental consequences of energy
    production, development, and use. The BER program contributes to a
    healthy citizenry, cleanup of the environment, and understanding global
    environmental change, and operates the world class facilities essential
    to the scientific breakthroughs of the future.
        As part of the President's Scientific Simulation Initiative, the
    BER request includes funding to accelerate the development of advanced
    global climate models with the high regional resolution needed for
    definitive predictions. This fundamental research will support the U.S.
    Global Change Research Program.
        The BER request also includes funding for the President's Climate
    Change Technology Initiative. The BER contribution to the initiative
    includes research to sequence microbes for alternative fuel production
    (methane and hydrogen production) and to develop natural carbon
    sequestration processes in terrestrial and ocean systems.
        Life Sciences.--The Human Genome Program continues to be the
    centerpiece of our Life Sciences Research program, both in terms of its
    contribution to the international effort to sequence the human genome,
    and in terms of the spin-off technologies. Through efforts at the Joint
    Genome Institute and its Production Sequencing Facility, DOE does its
    share of high-throughput human DNA sequencing and develops, validates,
    and integrates new DNA sequencing technologies into the production of
    DNA sequencing. Fiscal year 2000 is the third year of a 3-5 year scale-
    up in DNA sequencing capacity for the Joint Genome Institute. The DOE's
    share of the funding for the U.S. Human Genome Program is about 25
    percent of the national effort.
        The field of microbial genomics continues to be one of the most
    exciting and high profile fields in biology today. Initiated by DOE in
    1994, microbial genomics and microbial genomic sequencing were
    identified by Science Magazine as one of the top 10 fields of discovery
    each of the past two years. The broad impacts of this research
    emphasizes a central principle of the BER genome programs--complete
    genomic sequences yield answers to fundamental questions in biology.
    Microbes are being sequenced and characterized in several parts of the
    BER program because of potential impacts across several DOE missions.
    These include the Climate Change Technology Initiative (sequencing
    methane or hydrogen producing microbes or microbes involved in carbon
    dioxide sequestration), environmental cleanup (microbes for
    bioremediation), alternative fuel sources (methane production or energy
    from biomass), industrial processes (industrial useful enzymes), and
    biological nonproliferation (understanding and detecting biowarfare
    agents). The fiscal year 2000 request includes funds for determining
    the DNA sequence of 10 microbes with significant potential for waste
    cleanup, energy production, or carbon sequestration.
        The fiscal year 2000 request provides continuing support for both
    the national user facilities for scientists and the research support
    needed to determine the molecular structure and function of enzymes,
    antibodies, and other important biological molecules. Computational
    structural biology research combines computer science, structural
    biology, and genome research to predict the functions of biological
    molecules. This information will enable the design or more efficient
    use of biological molecules for drugs to control or treat a great
    variety of diseases, environmental cleanup, or energy-production and
    use.
        The low dose radiation research program uses molecular level
    knowledge gained from the Department's human genome and structural
    biology research to determine the human health impacts, all the way
    from effects on single molecules to people, of exposures to low doses
    of energy and defense-related radiation. This information will provide
    an improved scientific basis for remediating contaminated DOE sites and
    achieving acceptable levels of human health protection, both for
    cleanup workers and the public, in a more cost-effective manner that
    could save billions of dollars. A key aspect of this program is the
    regular communication between scientists who propose and conduct the
    research and regulators who develop and implement risk policy.
        Environmental Processes.--The Environmental Processes subprogram
    conducts research on a range of issues related to the mission of the
    U.S. Global Change Research Program (USGCRP). Activities are focused on
    understanding and predicting the potential consequences on climate and
    ecological systems and resources of the emissions of aerosols and trace
    gases, especially carbon dioxide from fossil fuel combustion.
    Additional efforts support the Climate Change Technology Initiative
    (CCTI).
        As the major federal agency supporting research into climate
    predictions on the decade-to-century time scale, the DOE continues an
    integrated observational and modeling program focused on predicting
    climate variability and climate change 10 to 100 years in the future.
    The BER Climate Change Prediction Program will continue to extend its
    modeling breakthrough in ocean simulation to develop a fully coupled
    atmosphere-ocean model useful for climate prediction. Because of the
    limited high-end computational resources, computer-intensive climate
    modeling at regional spatial resolution has been difficult to perform.
    To address this need, BER will support a Scientific Simulation
    Initiative (SSI) in collaboration with other agencies, including the
    National Science Foundation, National Oceanic and Atmospheric
    Administration, and National Aeronautics and Space Administration to
    accelerate the development of advanced global climate change models
    with higher spatial resolution than currently available. The SSI will
    make high-end computational resources more available to the climate
    modeling community than at present, improve climate models capable of
    simulating the principal components of a coupled atmosphere-ocean
    climate system, and increase the availability and usability of climate
    change projections to the broader climate change research and
    assessment communities.
        The BER request includes funding to operate three Atmospheric
    Radiation Measurement sites and eighteen AmeriFlux sites to provide
    data to improve climate models and understand the magnitude and
    variation in carbon sequestration in major terrestrial ecosystems in
    North and Central America. The BER Environmental Processes subprogram
    will also continue to support major experimental studies to develop
    data to improve understanding of the ecological effects of climate and
    atmospheric changes.
        As part of the CCTI, BER will support research to better understand
    the biophysical processes controlling carbon sequestration in
    terrestrial and ocean systems, with the long term objective of both
    developing approaches to manipulate these processes to enhance carbon
    sequestration on land and in the ocean and understand the environmental
    and economic implications of implementing such approaches. These
    studies will complement previously noted efforts to sequence the
    microbial genomes as part of the BER CCTI program.
        The Environmental Processes subprograms provide a scientific basis
    for assessing both the effects of human activities on the Earth's
    climate and the need for action to mitigate any adverse effects. They
    also provide information needed to determine the potential of natural
    processes in terrestrial and ocean systems to help mitigate the
    increase in atmospheric carbon dioxide from fossil fuel combustion. The
    Environmental Processes subprograms are coordinated with other agencies
    through the National Science and Technology Council's Committee on
    Environment and Natural Resources.
        Environmental Remediation.--Research in the Environmental
    Remediation subprogram is focused on understanding the fundamental
    physical, chemical, geological, and biological processes that must be
    marshaled for the development and advancement of new, effective, and
    efficient processes for the remediation and restoration of the Nation's
    nuclear weapons production sites. The two highest priorities of this
    subprogram are bioremediation research and operation of the William R.
    Wiley Environmental Molecular Sciences Laboratory (EMSL) as a national
    scientific user facility to investigate fundamental molecular processes
    and properties that affect the environmental transformation, mobility,
    and biological availability of contaminants. The EMSL focuses on
    molecular-level collaborative research in the environmental sciences,
    and provides support to over 600 users, with over half of those from
    academia. The subprogram also addresses both natural bioremediation,
    which relies on naturally occurring microbial and plant processes, and
    accelerated bioremediation, which seeks to accelerate desirable
    processes through, for example, environmental modifications or the
    addition of amendments to contaminated environments.
        The Environmental Remediation subprogram request also includes the
    infrastructure funding for BER program activities. The funding enables
    minor construction activities associated with upkeep of buildings and
    building systems at these research facilities. It includes such items
    as new roofs and heating, ventilation, and air-conditioning upgrades
    and replacements.
        Medical Applications and Measurement Science.--The Medical
    Applications program fosters research to enable beneficial applications
    of nuclear and other energy-related technologies for medical diagnosis
    and treatment. The program promotes a fertile partnership among the
    sciences, advanced technologies and medicine in three major research
    areas: nuclear medicine; boron neutron capture therapy (BNCT); and
    instrumentation. Research in radiopharmaceutical chemistry and imaging
    techniques and investigation of a broad range of potential diagnostic
    and therapeutic applications provide the scientific and technological
    foundation for the expansion of nuclear medicine as a major medical
    specialty and for the continued vitality of the national industries for
    radiopharmaceutical development and production and medical imaging
    instrumentation. The technologies developed under this program are
    directed at solving major problems in medicine, such as the non-
    invasive detection and localization of small malignant lesions in the
    body, the quantitative measurement of dynamic organ function, and the
    treatment of cancers that resist conventional therapies. Nuclear
    medicine at the Department has accelerated with many recent
    contributions in areas as diverse as medical imaging technologies for
    improved diagnostic accuracy and radiopharmaceuticals for the study and
    treatment of substance abuse. Medical Applications research, in
    partnership with the Department's human genome and life sciences
    research, is forging new technologies to find not only where disease-
    causing processes take place, but to locate and study the action of
    genes involved in still-mysterious normal functions such as learning
    and memory.
        Our measurement science program focuses on research and development
    of new instrumentation to meet the needs of our environmental and life
    sciences programs for better ways of characterizing samples ranging
    from living cells to subsurface contaminants. The fiscal year 2000
    request provides for a variety of activities, with particular emphasis
    on using the advanced technologies developed in the Department's
    National Laboratories for environmental and biomedical research.
                              high energy physics
    Fiscal Year 1999 Appropriation--$695.5 M; Fiscal Year 2000 Request--
            $697.1 M
        High energy physics research seeks to understand the nature of
    matter and energy at the most fundamental level, as well as the basic
    forces which govern all processes in nature. The Department of Energy
    provides more than 90 percent of the Federal support for the Nation's
    high energy physics (also called elementary particle physics) research
    program. The balance is provided by the National Science Foundation
    (NSF). Our knowledge of the universe, the fundamental constituents of
    matter, and the laws of nature that underlie all physical processes
    continues to grow as a result of this research.
        High energy physics research not only helps us learn how the world
    works, it also contributes to the Nation's economic competitiveness in
    the high-technology marketplace. High energy physics research requires
    accelerators and detectors utilizing state-of-the-art technologies in
    many areas, including fast electronics, particle detectors, high speed
    computing, superconducting magnets, and high power radiofrequency
    devices. In these areas, high energy physics research frequently drives
    the technology, which not only contributes to other scientific
    disciplines, but also has led to many practical applications having
    major economic and social impacts. Who could have predicted that
    research that went into the building of accelerators and particle
    detectors and the subsequent technology would contribute so much to
    today's medical imaging capabilities. And who could have predicted that
    particle physicists seeking new ways of communicating and sharing large
    amounts of data would change the way in which the world communicates--
    yet that is just what the World Wide Web has done.
        The High Energy Physics program also has a history of attracting
    and training some of the best and brightest young minds. The training
    they receive prepares them for careers not just in high energy physics,
    but also in other disciplines as well, including computer sciences,
    teaching, industrial research. It is the unique problem solving
    abilities learned from this scientific discipline that make them
    attractive. More than half of the Ph.D.'s trained for high energy
    physics find permanent employment outside the field.
        Carrying out high energy physics research effectively depends on
    many elements including the availability of forefront experimental
    capabilities, effective use of specialized facilities, and the
    availability of new and upgraded facilities to take advantage of new
    technologies and research opportunities. The Department supports two
    major high energy physics accelerator centers--the Fermi National
    Accelerator Laboratory (Fermilab) and the Stanford Linear Accelerator
    Center (SLAC). Each of these laboratories provides unique capabilities
    and is operated as a national facility available to qualified
    experimenters around the Nation and abroad on the basis of the
    scientific merit of their research proposals. In addition, the high
    energy physics program makes limited use of the AGS at BNL. (The AGS
    will be transferred to the nuclear physics program, at the end of
    fiscal year 1999, to be operated as an integral part of the RHIC
    facility). Approximately 2,000 U.S. scientists and 200-300 foreign
    scientists work at these facilities at any given time.
        Experimental and theoretical researchers from more than 100
    universities conduct about three fourths of the research, with the
    remainder being done by national laboratory staff. In general, the
    laboratories and universities perform different, but complementary,
    activities. University scientists provide the primary intellectual base
    for the program, performing experimental research at accelerators and
    non-accelerator facilities, technology R&D, and theoretical research.
    University grantees are selected and retained based on the quality,
    appropriateness, and performance of their research activities. All
    research proposals received are subjected to a rigorous multi-stage
    review, especially including peer review by technical experts from the
    high energy physics community.
        National laboratories primarily provide major accelerator
    facilities at which university scientists perform their research. In
    addition, the laboratories provide the related technical and scientific
    expertise, as well as day-to-day liaison between university researchers
    and laboratory experts and management. Responsibility and authority for
    setting the program at a national laboratory and for determining which
    experiments are awarded running time rest primarily with the laboratory
    directorate within the general guidelines provided by the Department.
    Research requiring the use of a facility at one of the laboratories is
    reviewed extensively by the laboratory including by the laboratory's
    Program Advisory Committee (PAC), another form of peer review. The
    Department carries out its oversight responsibilities by conducting
    annual reviews of the laboratories' scientific programs. In addition,
    the Department tracks project progress against budget and schedule
    milestones using semiannual project reviews.
        The Fermi National Accelerator Laboratory (Fermilab) is home to the
    world's highest energy superconducting accelerator, the Tevatron, which
    provides both fixed target and colliding beam research programs. The
    colliding beam research program has two major detector facilities, the
    Collider Detector at Fermilab (CDF) and the D-Zero Detector, which
    complement each other in their different technical capabilities.
    Fermilab completed a very successful fixed target run this past year
    prior to shutting the Tevatron down to bring the Main Injector on line.
    These two collaborations continued to produce new scientific knowledge
    during this run. The CDF collaboration of university and laboratory
    scientists from around the world observed the predicted B meson which
    contains a charm quark; this discovery completes the theoretically
    predicted family of B mesons. In addition, the KTeV experimental
    collaboration of university and laboratory scientists made the first
    observation of the decay of a kaon into two charged pions plus an
    electron-positron pair. This collaboration also made the first
    observation of violation of time-reversal invariance (T-violation), by
    making precise measurements of these decays. T-violation had been
    predicted on the basis of other results, but had never been directly
    observed.
        Construction of the Fermilab Main Injector project was completed on
    schedule and within budget. Commissioning is proceeding very well, and
    the first physics run is expected later in fiscal year 1999. The CDF
    and D-Zero upgrades are progressing well; and the upgraded detectors
    will be moved back into position on the Tevatron beam line and
    commissioning will begin with them late in fiscal year 2000. This
    project will provide a fivefold increase in collider luminosity and a
    doubling of intensity for the fixed target program, as well as allowing
    simultaneous operation of the collider and fixed target programs, a
    capability previously not possible. The Main Injector will greatly
    enhance the physics capabilities of the Tevatron accelerator and its
    detector facilities and increase the likelihood for major new
    scientific developments early in the next century.
        Also at Fermilab, the NuMI/MINOS (Neutrinos at the Main Injector)
    project design got underway in fiscal year 1998. The experiment will
    study the possible oscillations between different types of neutrinos to
    determine if neutrinos have mass. The beam of neutrinos for the project
    will be produced at Fermilab and aimed at two detectors--one on site
    and the other at the Soudan Underground Laboratory in northern
    Minnesota. The project baselines for cost, scope, schedule, and
    management were established in November 1998. Detailed design for the
    NuMI underground enclosure and technical components will be developed
    in 1999, and excavation of the cavern in Minnesota for the MINOS
    detector is also expected to begin later this year.
        In addition, Fermilab continues to play an active role in the Large
    Hadron Collider. Fermilab is the host and center of the U.S. CMS
    detector effort of university and laboratory scientists, and host and
    center of the U.S. LHC accelerator collaboration, with specialized
    expertise in the design and fabrication of superconducting magnets.
        At the Stanford Linear Accelerator Center (SLAC), the Stanford
    Linear Collider (SLC), the world's only high energy linear collider,
    continued during fiscal year 1998 to achieve record high luminosities
    in positron-electron collisions, and the SLD detector reached more than
    20,000 Zo events per week. Researchers from universities and
    laboratories conducting research at SLAC are in the process of
    analyzing the large amounts of data collected. In fiscal year 1999, the
    SLC was shut down to allow for the B-factory to be brought on line.
    Construction of the B-factory PEP-II storage rings was completed in
    fiscal year 1998 on schedule and within budget. Commissioning began in
    mid-May 1998, resulting in first electron-positron collisions in July
    1998. Commissioning has continued to go very well, and substantial
    progress toward achieving design luminosity has already been made.
    Data-taking with the BaBar detector will begin later in fiscal year
    1999, and about 39 weeks of operation is planned for fiscal year 2000.
    The B-factory will provide a high luminosity, asymmetric electron-
    positron colliding beam facility to study the preponderance of matter
    over anti-matter in our universe. It will also provide opportunities
    for university and laboratory scientists to pursue a rich program of
    experiments in a large number of other areas of intense interest in
    high energy physics. In addition to all-out running of the B-factory in
    fiscal year 2000, emphasis will continue on R&D in support of a future
    linear collider. Participation with NASA and university scientists in a
    non-accelerator-based experiment, the Gamma-ray Large Area Space
    Telescope (GLAST), is also planned.
        The Alternating Gradient Synchrotron (AGS) at Brookhaven National
    Laboratory (BNL) will be transferred later in fiscal year 1999 to the
    Nuclear Physics program to be operated as the injector for RHIC.
    Operation of the AGS for the high energy physics program in fiscal year
    2000 and beyond will be on an incremental cost basis. Recently, U.S.
    university and laboratory researchers working at the AGS recorded a
    first observed decay of a charged kaon to a pion and two neutrinos,
    first observation of the decay of a neutral kaon to an electron-
    positron pair, as well as evidence for the existence of an unusual
    meson. AGS operation for high energy physics in fiscal year 2000 will
    be for the high precision measurement of the anomalous magnetic moment
    of the muon. Brookhaven is also a key participant in the LHC project as
    host and center of the U.S. ATLAS detector collaboration of university
    and laboratory scientists, as well as a participant in the U.S.
    accelerator collaboration. BNL's Accelerator Test Facility (ATF), a
    small, low energy electron linac, has achieved one of the brightest
    electron beams in the world. It is used by universities, national
    laboratory groups, and industry for testing new advanced accelerator
    concepts.
        The Large Hadron Collider (LHC), a machine that will be about seven
    times the energy of the Fermilab Tevatron, is in the process of being
    built at the European Laboratory for Particle Physics (CERN) in Geneva,
    Switzerland. The U.S. and CERN have signed an agreement that provides
    for U.S. support and participation in the project. The LHC will become
    the foremost high energy physics facility in the world around the
    middle of the next decade. With the LHC at the energy frontier,
    American scientific research on the frontier depends on participation
    in the LHC. It will ensure continued world class excellence of our
    university and national laboratory scientists and will provide training
    to many students in leading edge science and technology.
        The Department will provide a total contribution of $450 million
    for the specifically agreed to components of the two detectors and the
    LHC accelerator over the period fiscal year 1996 through fiscal year
    2004. Of the $450 million, $250 million will support U.S. activities on
    the LHC detectors, while $200 million will support U.S. activities
    working on the LHC accelerator. NSF will provide approximately $81
    million for U.S. work on the detectors. Almost all of this funding will
    be spent in the U.S. for in-kind contributions from U.S. laboratories,
    universities, and industry. Funding in the amount of $70 million is
    being requested by the Department in fiscal year 2000.
        During the past year, progress continued to be made on the
    technical components for the LHC and many management details were
    finalized. Technical, cost, and schedule baselines for the three
    subprograms--ATLAS detector, CMS detector, and the accelerator--were
    reviewed and approved; a Memorandum of Understanding between DOE and
    NSF on U.S. participation in the LHC project was negotiated and signed;
    and Project Management Plans were finalized and put in place for the
    accelerator, ATLAS detector, and the CMS detector, as well as the
    overall U.S. LHC Project Execution Plan. In fiscal year 2000, the
    fabrication of components for the LHC continues. The U.S. LHC project
    continues to be on schedule and within budget.
                                nuclear physics
    Fiscal Year 1999 Appropriation $334.6 M, Fiscal Year 2000 Request
            $342.9 M
        The primary goal of nuclear physics research is to understand the
    structure and properties of atomic nuclei and the fundamental forces
    between the constituents that form the nucleus. Nuclear processes
    determine essential physical characteristics of our universe and the
    composition of the matter that forms it.
        Beyond maintaining world leadership in basic research, the Nuclear
    Physics program develops and transfers knowledge to enhance the
    Nation's technological and economic competitiveness in such fields as
    nuclear medicine. The Nuclear Physics program continues to be a vital
    source of trained people for fundamental research and for these applied
    technology areas. The program supports the graduate training of
    approximately 450 students per year, and typically 100 Doctorates in
    nuclear physics are awarded each year in DOE-supported nuclear physics
    programs. A majority of these highly trained researchers will take
    positions in high-technology private industry.
        Many future nuclear physics investigations will study questions
    related to the quark presence in composite nuclei. Until the last few
    years, the fundamental understanding of nuclear properties has been
    based on the idea of a nucleus composed of protons and neutrons that
    interact through a combination of weak, strong, and electromagnetic
    forces. It became clear that achieving a real knowledge of many nuclear
    properties depends on understanding nuclear structure based on quarks,
    and particles called gluons that bind the quarks together. Quarks and
    gluons are the building blocks of protons and neutrons (nucleons). The
    Long Range Plan for the U.S. Nuclear Physics Program, prepared by the
    nuclear physics community every five years, provides the definition of
    the pressing issues in nuclear science and the priorities for pursuing
    important scientific problems in various budget scenarios.
        Studies of nuclear structure require ultra-high resolution
    ``microscopes'', accelerators that produce particle beams of various
    energies, depending on the problems to be studied. The request is
    designed to provide the sufficient hours for these facilities, so that
    researchers may take advantage of their unique capabilities.
        Research programs at the Thomas Jefferson National Accelerator
    Facility (TJNAF), formerly CEBAF, are studying effects due to the
    presence of quarks in nucleons in the nucleus. Two principal focuses of
    these studies are to continue to develop an understanding of how the
    ``spin'' of a nucleus originates in the quarks, and how the size of a
    quark cluster in a nucleus affects the strength of the interaction of
    that cluster with other nucleons in the nucleus. It is interesting to
    note that no one has ever observed a single free quark; they always
    travel in closely knit groups of threes within nucleons and twos within
    mesons. In fiscal year 2000, TJNAF will operate for 4,500 hours to
    allow several high priority experiments to study the quark presence in
    nuclei. The laboratory is fully operational, and all three experimental
    halls are being utilized for experiments.
        In fiscal year 2000, the new Relativistic Heavy Ion Collider (RHIC)
    at Brookhaven National Laboratory, a second major facility for the
    study of new ``quark-based'' nuclear physics, will be searching for a
    predicted quark-gluon plasma. Construction of RHIC will be complete in
    the third quarter of fiscal year 1999, and the new facility will be
    fully operational in fiscal year 2000. It is predicted that if a
    collection of nucleons could be compressed and heated to a very high
    temperature by collisions of high energy heavy nuclei, there would be a
    phase transition to a new state of nuclear matter in the collision
    region where the quarks are ``freed'' from their nucleon boundaries to
    form a so-called quark-gluon plasma.
        RHIC will be a unique, world-class facility with colliding
    relativistic heavy ion beams that will permit exploration of this hot,
    dense nuclear matter and recreate the transition from quarks to
    nucleons which characterized the early evolution of the universe.
    Studies with colliding heavy ion beams will provide researchers with
    their first laboratory opportunity to explore this new region of
    nuclear matter and nuclear interactions which up to now has only been
    studied theoretically. In fiscal year 2000, RHIC will begin its first
    full year of operations with a 33 week running schedule and a goal of
    22 weeks (3,300 hours) for research and 11 weeks for accelerator
    studies.
        Some of the most critical nuclear reactions in stellar burning
    processes involve nuclei which, because of their short lifetimes, have
    not been available for laboratory studies. Three Nuclear Physics
    facilities will be investigating these reactions by generating
    radioactive beams as new probes of nuclear structure.
        Another new generation facility, the Holifield Radioactive Ion Beam
    Facility (HRIBF) at Oak Ridge National Laboratory is now producing some
    of the previously unavailable nuclear beams so that these important
    stellar processes can be studied in the laboratory. Beams for
    experiments became available in fiscal year 1998 and it is possible for
    the first time to study many processes which are crucial to our
    understanding of how nuclei were synthesized in the Big Bang. In fiscal
    year 2000, the HRIBF will operate for 2,400 hours for studies of these
    processes and for studies of very proton rich nuclei far from
    stability. Radioactive ion beams, in addition to the stable beams
    normally provided, are also being produced at the ATLAS accelerator at
    Argonne National Laboratory and the 88-inch Cyclotron at Lawrence
    Berkeley National Laboratory. These laboratories are pursuing research
    as well as developing new techniques for the generation of radioactive
    beams. The experience gained and ideas generated at all three
    laboratories will provide important input to the design of a proposed
    new Isotope Separator On Line (ISOL) radioactive beam facility
    presently being studied by the Nuclear Physics Program.
        Subsequent to submission of the fiscal year 2000 budget request,
    the Department has determined that the MIT/Bates accelerator will
    continue to operate. The Department will work with the Administration
    to submit a budget amendment and an amended budget request.
        The solar neutrino problem remains one of the great challenges in
    astrophysics. The predicted rate of neutrino production by the sun is
    significantly higher than the observed rate. There are two possible
    explanations for the discrepancy. Either our understanding of solar
    burning is very wrong, or the neutrino has a small mass, in
    contradiction to the long-held belief that it is massless. Construction
    of a third major new facility to study this problem, the Sudbury
    Neutrino Observatory (SNO), 7000 feet below the surface of the earth in
    Canada, was completed in fiscal year 1998. In fiscal year 1999,
    preliminary data is being accumulated as the detector is being filled
    with ``heavy water''. SNO, which will be fully operational in fiscal
    year 2000, is designed to sort out this long standing solar neutrino
    problem. The project involves an international collaboration among the
    U.S., Canada, and the United Kingdom.
                             fusion energy sciences
    Fiscal Year 1999 Appropriation--$222.6 M, Fiscal Year 2000 Request--
            $222.6 M
        The fiscal year 2000 budget request for the Fusion Energy Sciences
    program continues a broad-based, fundamental research effort to acquire
    the knowledge base needed for an economically and environmentally
    attractive fusion energy source.
        Fusion research provides two major benefits--in the near term there
    are advances in plasma science and technology spinoffs and in the long
    term there is the basis for development of a new energy source.
    Advances in plasma science have contributed to numerous other areas of
    science. In astrophysics, it has allowed an understanding of the
    behavior of plasma and magnetic fields in the earth's magnetosphere, in
    the sun and other stars and the galaxies. Plasma physics is integral to
    our understanding of magnetic storms, solar flares, shock waves in
    space, magnetic fields, black holes, and star formation. In the area of
    large-scale scientific computing, fusion research pioneered the use of
    supercomputers to solve complex problems. Novel optical and magnetic
    diagnostics have been created to provide access to the extreme
    temperature, density, and magnetic fields prevalent in fusion
    experiments. In addition, fusion and other plasma based research has
    provided a stimulus to the development of large superconducting
    magnets, development of advanced materials, advancement in pulsed-power
    technology, and plasma aided manufacturing processes such as those used
    in semiconductor device fabrication.
        Although there is no schedule for developing and deploying fusion
    energy systems, the availability of fusion, as an option for large
    central station power plants, would be valuable insurance against
    possible environmental concerns about fossil and nuclear energy. As
    fusion is one of the few potential sources capable of providing an
    appropriate energy intensity for urbanized society in an
    environmentally sustainable fashion, development of fusion as a
    practical energy source may be essential for the longer term. In
    addition, there may also be non-electric applications of fusion in the
    transmutation of wastes and isotope production.
        The quality of the research in this program is continuously
    evaluated through the use of merit based peer review and scientific
    advisory committees. In addition, the Department has requested the
    National Academy of Sciences to review the quality of science in the
    fusion program in fiscal year 1999. We will also be carrying out a
    review of fusion energy technologies using the Secretary of Energy
    Advisory Board. The Fusion Energy Sciences Advisory Committee has also
    been asked to assess program restructuring and the overall balance of
    research efforts. A program plan/roadmap for fusion, including both
    magnetic and inertial and based on the above reviews, will be completed
    by the end of 1999.
        As a part of the ongoing restructuring of the program, the major
    U.S. experimental facilities--the DIII-D at General Atomics, the
    Alcator C-Mod at the Massachusetts Institute of Technology, and the new
    National Spherical Torus Experiment (NSTX) at the Princeton Plasma
    Physics Laboratory (PPPL)--are being managed as national resources with
    multi-institutional topical teams addressing the scientific issues and
    coordinating efforts on relevant facilities. The fiscal year 2000
    budget request provides for substantial operation of all three
    facilities, along with modest upgrades.
        The Tokamak Fusion Test Reactor (TFTR) located at PPPL was closed
    down in fiscal year 1997 after 13 years of pioneering experiments
    yielding significant scientific results from producing actual fusion
    power in a laboratory. In fiscal year 2000 we will begin a 3-year
    program to decontaminate and decommission the TFTR facility. This will
    provide for the removal of the TFTR tokamak and activated components
    from the experimental test cell and basement.
        Fabrication of the NSTX, a vital new device of a much smaller scale
    than TFTR, will be completed in April 1999. This proof-of-principle
    facility will provide the scientific basis for an innovative magnetic
    confinement concept that has indicated the potential for reactor-scale
    plasma performance in earlier very small experiments.
        In fiscal year 2000 a conceptual design will be completed for a
    novel compact stellarator-tokamak experiment that combines the best
    features of the two leading magnetic fusion concepts. Critical
    computing codes will be modernized to take full advantage of the
    President's Information Technology Initiative. In addition, three new
    innovative concept exploration experiments will become fully
    operational.
        In accordance with congressional direction and with the cooperation
    of our International Thermonuclear Experimental Reactor (ITER)
    partners, the Department will complete an orderly closeout of our ITER
    activities in fiscal year 1999. The R&D activities to complete the U.S.
    Model Coil and to be involved in its test in Japan are proceeding
    through fiscal year 1999 consistent with congressional direction. The
    Model Coil is part of the largest superconducting magnet ever built to
    operate with a changing magnetic field. It was recently completed and
    is now en route to Japan where the testing will be done.
        The European Union, Japan, and the Russian Federation are
    proceeding with a 3-year extension of the ITER program to complete the
    design of a reduced cost and reduced objectives facility, and to decide
    in 2-3 years whether and where to construct ITER. We will be involved
    only on the periphery of the project consistent with traditional
    exchange of scientific information. If the other Parties decide to
    construct a burning plasma facility like ITER, the United States will
    then consider whether to propose to be involved.
        With the closeout of the ITER activities, we are restructuring the
    fusion technology development activities to focus on our domestic needs
    in advancing the science of fusion. Emphasis will be placed upon R&D
    that will enable existing and near-term U.S. fusion facilities to
    achieve their ultimate performance capability. New methods of modeling
    and predicting the behavior of fusion materials will be investigated.
    R&D will continue on novel methods of enabling the new, innovative U.S.
    fusion concepts to achieve their full performance. This will include
    applied scientific research on issues such as the use of flowing liquid
    walls to handle heat and particle flux in magnetic or inertial systems
    and the study of advanced heating and fueling techniques. Some
    international R&D collaboration will continue at foreign facilities
    that have scientific research capabilities beyond those in the United
    States. Also, as part of the restructuring of this element of the
    fusion program, a Virtual Laboratory for Technology has been
    established to improve the governance of the various, diverse enabling
    R&D elements through improved advocacy, coordination, and
    communication.
        In conclusion, the U.S. Fusion Energy Sciences program has made
    excellent scientific progress and has been responsive to the
    congressional request to restructure the program. Fusion and plasma
    science make a unique contribution to the nation's scientific
    infrastructure in the near-term and provide a vital energy option for
    the future. Europe and Japan are making large investments in this area.
    The challenge to the United States is to continue a strong scientific
    base program, including making effective use of existing facilities,
    and to sustain a meaningful participation in the world program.
                     computational and technology research
    Fiscal Year 1999 Appropriation--$157.5 M; Fiscal Year 2000 Request--
            $198.9 M
        Some of the pioneering accomplishments of the Computational and
    Technology Research (CTR) program are: development of the technologies
    to enable remote, interactive access to supercomputers; research and
    development leading to the High Performance Parallel Interface (HiPPI)
    standard; and research leading to the development of the slow start
    algorithm for the Transmission Control Protocol (TCP), which enabled
    the Internet to scale to today's worldwide communications
    infrastructure. This long history of accomplishments in the CTR program
    continued in fiscal year 1999 including: the 1998 Gordon Bell Prize for
    Best Performance of a Supercomputing Application, the 1998 IEEE
    Fernbach Award for outstanding contribution in the application of high
    performance computers using innovative approaches and four R&D 100
    Awards to CTR researchers in areas ranging from parallel numerical
    libraries to near frictionless coatings.
        The CTR program supports advanced computing research--applied
    mathematics, high performance computing, networking, and operates
    supercomputer and associated facilities that are available to
    researchers 24 hours a day, 365 days a year. The combination of support
    for fundamental research, computational and networking tools
    development, and high-performance computing facilities provides
    scientists with the capabilities to analyze, model, simulate, and--most
    importantly--predict complex phenomena of importance to the Office of
    Science and the Department of Energy.
        Experiments at Office of Science facilities may generate millions
    of gigabytes (petabytes) of data per year (which would fill the disk
    drives of millions of today's personal computers) presenting
    significant computational and communications challenges in analyzing
    and extracting information from the data. The wide-area, data-intensive
    collaborations of the Department are the focus of DOE's efforts in the
    Next Generation Internet (NGI) Initiative. CTR is responsible for DOE
    participation in the NGI program to create the foundation for more
    powerful and versatile networks of the Twenty-first century.
        CTR also heads the Department's Scientific Simulation Initiative
    (SSI) as a competitive, peer-reviewed program with the other program
    offices in SC. CTR's role in the SSI includes management of the
    selection process for the two basic science application efforts
    initiated in fiscal year 2000, management of the SSI Advanced Computing
    and Communications Facilities, and management of the Computer Science
    and Enabling Technology component.
        In addition to these computing related activities CTR also manages
    the Laboratory Technology Research (LTR) program for the Office of
    Science. The mission of this program is to support high risk, energy
    related research that advances science and technology to enable
    applications that could significantly impact the Nation's energy
    economy. LTR fosters the production of research results motivated by a
    practical energy payoff through cost-shared collaborations between
    Office of Science laboratories and industry.
                       multi program energy laboratories
                               facilities support
    Fiscal Year 1999 Appropriations--$21.3 M; Fiscal Year 2000 Request
            $21.3 M
        Fulfillment of the DOE's science and technology goals depends
    heavily on the existence and operating efficiency of the five
    multiprogram SC laboratories. The five multiprogram energy laboratories
    are: Argonne National Laboratory-East, Brookhaven National Laboratory,
    Lawrence Berkeley National Laboratory, Oak Ridge National Laboratory,
    and Pacific Northwest National Laboratory. These laboratories have over
    1000 buildings with 14.7 million gross square feet an average age of 35
    years. Their estimated replacement value is over $8.7 billion. All
    facilities at these laboratories are government-owned, contractor-
    operated (GOCO). Total operating funding for these laboratories
    including work-for-others is over $3 billion a year.
        Portions of the infrastructure of these laboratories are old,
    deteriorating, and, in some cases, obsolete. Improvements are needed to
    comply fully with the environment, safety and health requirements in
    effect today as well as to meet everyday operational needs.
        The Office of Science established the Multiprogram Energy
    Laboratories-Facilities Support (MEL-FS) program in 1981 to provide a
    systematic approach to its stewardship responsibility for the general
    purpose support infrastructure of these laboratories. The MEL-FS
    program helps to preserve the government's investment in infrastructure
    and to maintain infrastructure integrity in a reasonable and economic
    manner at these laboratories.
        The program supports line item construction projects to refurbish
    and replace inadequate general purpose facilities and infrastructure.
    This budget request provides for continuation of six on-going projects
    and for two new projects. Projects are selected based on the Life Cycle
    Asset Management the Cost-Risk-Impact Scoring Matrix. The new starts
    are:
        Fire Safety Improvements--Phase IV, (ANL-E).--This project will
    bring 30 major facilities into compliance with the Life Safety Code and
    the National Fire Alarm Code. It will significantly improve the fire
    detection, suppression, and reporting capabilities at the lab, thereby
    reducing the possibility and magnitude of personnel or property loss
    during a fire.
        Electrical Systems Upgrade, (ORNL).--This project will upgrade the
    30-50 year-old electrical system to include: replacing overhead
    feeders; installing advanced protective relaying capabilities at major
    substations; and replacing major switchgear and transformers. This
    project will increase system reliability and capacity, while reducing
    the possibility of personnel injury or lost productivity due to system
    failures.
        The program also provides funding for Payments in Lieu of Taxes
    (PILT) as authorized by the Atomic Energy Act of 1954, as amended.
    These discretionary payments are made to state or local governments
    where the Department or its predecessor agencies have acquired property
    previously subject to state or local taxation.
                            energy research analyses
    Fiscal Year 1999 Appropriation--$1.0 M; Fiscal Year 2000 Request--$1.0
            M
        The mission of the Energy Research Analyses (ERA) program is to
    conduct technical assessments of the Department's civilian research and
    development programs and to provide direction to future research and
    development activities. Energy Research Analyses also conducts science
    policy analyses, and coordinates the development of the Office of
    Science Strategic Plan and the DOE Science Portfolio.
        The fiscal year 2000 budget request will provide funding for peer
    reviews of projects in the Office of Science, Fossil Energy, and Energy
    Efficiency to continue to improve the quality and relevance of DOE
    research and development. Other activities will include evaluation of
    critical planning and policy issues of DOE science and technology using
    expert groups at the National Academy of Sciences, the JASON group,
    etc., as appropriate.
                           science program direction
    Fiscal Year 1999 Appropriation--$49.8 M; Fiscal Year 2000 Request--
            $52.3 M
        Science Program Direction provides the Federal staffing resources
    and associated costs required to provide overall direction of
    activities carried out under the Office of Science. This program
    supports staff in the High Energy Physics, Nuclear Physics, Biological
    and Environmental Research, Basic Energy Sciences, Fusion Energy
    Sciences, Computational and Technology Research, Multiprogram Energy
    Laboratories-Facilities Support, and Energy Research Analyses programs,
    including management and technical support staff.
        Science Program Direction also supports staff at the Chicago,
    Oakland, and Oak Ridge Operations Offices directly involved in program
    execution. The management and technical support staff includes
    scientific and technical personnel and program management support in
    the areas of budget and finance, general administration, grants and
    contracts, information resource management, policy review and
    coordination, infrastructure management and construction management.
        At the direction of Congress in fiscal year 1999, funds were also
    provided in Science Program Direction for Science Education. These
    funds will support the Undergraduate Laboratory Fellowship, National
    Science Bowl and the Albert Einstein Distinguished Educator Fellowship
    programs. These programs utilize the Department's scientific and
    technical resources to enhance the development of a diverse, well-
    educated and scientifically literate workforce.
                               science education
        For fiscal year 2000, DOE proposes new science education activities
    focusing on assets at our laboratories to build a partnership with
    universities and educational institutions. These proposed science
    education activities will allow university faculty and student teams,
    at the undergraduate level, to participate on long term research
    projects at DOE laboratories. In addition, pre-college science and math
    teachers will be provided with laboratory research experience to
    improve their knowledge and skills of scientific discovery and to
    enhance their ability to apply them in a classroom environment. Funds
    for these activities are included in the line program budgets.
        There is a national need to maintain worldwide leadership in
    science and technology and to stay competitive in critical research
    areas such as high energy and nuclear physics, computational science,
    and renewable energy technologies. Our outstanding National
    Laboratories help to drive the progress of science and technology
    development in the United States. To replenish our stocks of scientists
    and engineers for the next century, we must invest in our nation's
    youth to encourage interest in science and scientific careers. A proven
    method to achieve this is by introducing students to the excitement of
    scientific research through exposure to the National Laboratories.
    Historically, over two-thirds of undergraduates who have participated
    in DOE programs have gone on to graduate school in disciplines directly
    related to DOE missions.
        According to the latest research, trends show a declining number of
    graduates in the natural sciences and engineering from the early
    eighties to 1996. This trend is especially true among women, even those
    who have displayed a natural aptitude for science and math on
    standardized test scores. By instituting a program that effectively
    promotes proficiency and inspires students, we can help to ensure our
    future in science to develop the technologies that help us meet our
    mission and contribute to economic growth.
        The proposed science education activities will provide hands-on
    experience to both students and faculty. Working with laboratory
    researchers links this work to real world, mission driven challenges
    while improving communications and connections between Academe and the
    National Laboratories. Undergraduate students and college faculty will
    be able to participate in and contribute to long-term research projects
    at the National Laboratories, providing unique opportunities for hands
    on experience with state-of-the-art equipment. This experience allows
    the student to develop technical skills that build confidence and
    reinforce classroom learning. This, in turn, will support a productive
    relationship between the national laboratory and the participating
    college or university while strengthening the research at both
    institutions. This activity efficiently connects academia and industry
    with the excellent resources of the DOE laboratories and the enormous
    intellectual resources of the nation's universities. $5 million of the
    SC request will provide over 1000 student and 200 faculty with
    fellowships for the Faculty/Student Science Teams during academic year
    2000-2001.
        The second new activity involves the training of pre-college
    teachers as part of a national effort to strengthen K-12 student
    performance in science, mathematics, and technology. The Department of
    Energy has a vested interest and vital role to play if Federal efforts,
    to ensure science literacy for all Americans and to develop future
    generations of scientists, are to be successful. This activity will
    provide high school and pre-college teachers with 8-week appointments
    at DOE's Office of Science Laboratories. In these settings, teachers
    will work in teams with scientists and engineers and will participate
    in and contribute to the ongoing research of the Laboratories. Teachers
    will participate in designing experiments, creating mathematical
    models, and collecting and analyzing data. Experience has shown that
    allowing teachers to experience being treated as research colleagues
    provides a sense of renewal, and increases connection to their field
    and profession. Therefore, this activity includes additional follow-up
    such as remote mentoring and opportunities for teachers to attend and
    make presentations at regional and national meetings of scientific and
    teacher organizations. It also includes loans and grants of equipment
    and materials, assistance in translating their research experience into
    investigations, activities, and demonstrations applicable to their
    classroom settings, and sharing research experiences with their
    colleagues. $5 million of the SC request will reach over 200 teachers
    nationwide annually through this activity.
                           energy supply r&d programs
                        technical information management
    Fiscal Year 1999 Appropriation--$8.6 million; Fiscal Year 2000--$9.1
            million
        The Technical Information Management (TIM) program provides timely,
    accurate technical information to DOE's researchers and the public by
    collecting, preserving, and disseminating scientific and technical
    information, the principal product resulting from DOE's multi-billion
    dollar research and development programs. The TIM program also provides
    worldwide energy scientific and technical information to DOE
    researchers, U.S. industry, academia, and the public through
    interagency and international information exchange agreements and
    coordinates technical information-related activities across DOE and its
    laboratories.
        In fiscal year 2000, TIM will build on the huge success of the
    Information Bridge (www.doe.gov/bridge) and use digital information
    technology to complete a virtual library of energy science and
    technology. Specifically, the Information Bridge, already with over 2
    million pages of searchable full-text R&D information, will be expanded
    to include both the most current research findings as well as historic
    records. To complete the virtual library capability, collaborative
    agreements with U.S. science journal publishers will be forged to
    establish hyper-text linkages between TIM's electronic journal
    citations and the publishers' full-text on-line journal articles. This
    capability will potentially save the Department millions of dollars in
    duplicate paper journal subscriptions.
                                    closing
        The significant increase in the fiscal year 2000 budget request for
    the Office of Science recognizes the critical role that fundamental
    knowledge plays in achieving the DOE missions and for the general
    advance of the Nation's economy and the welfare of its citizens. The
    Scientific Simulation Initiative represents a major investment in
    producing the necessary scientific computation and information
    infrastructure for DOE science applications as part of a multi-agency
    initiative. This request will also provide the U.S. scientific
    community with increased research capability and new opportunities at
    the DOE scientific user facilities, including progress on SNS, a new
    forefront neutron source, and upgrades of existing facilities. On
    behalf of the Administration and the Department, I am pleased to
    present this budget for the Office of Science and welcome the challenge
    to deliver results.
        This concludes my statement. I would be happy to answer your
    questions.

                            FISCAL YEAR 2000 CONGRESSIONAL BUDGET REQUEST--OFFICE OF SCIENCE
                                                [In millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                       Fiscal year
                                                                   -------------------------------------------------
                                Program                                   1998             1999
                                                                     Appropriation    Appropriation    2000 Request
    ----------------------------------------------------------------------------------------------------------------
    Basic Energy Science..........................................           651.8            799.5            888.1
    Biological and Environmental Research.........................           395.7            436.7            411.2
    Fusion Energy Sciences........................................           224.2            222.6            222.6
    Computational and Technology Research.........................           146.8            157.5            198.9
    High Energy Physics...........................................           668.6            695.5            697.1
    Nuclear Physics...............................................           314.7            334.6            342.9
    Multiprogram Energy Labs-Facilities Support...................            21.3             21.3             21.3
    Energy Research Analysis......................................             1.4              1.0              1.0
    Sciences Program Direction....................................            37.6             49.8             52.3
    SBIR/STTR.....................................................            80.7   ...............  ..............
                                                                   =================================================
          Subtotal................................................         2,542.8          2,718.5          2,835.4
    General Reduction for Use of Prior Year Balances..............           (15.3)           (13.0)  ..............
    Superconducting Super Collider................................           (35.0)            (7.6)  ..............
                                                                   -------------------------------------------------
          Total...................................................         2.492.5          2,697.9          2,835.4
                                                                   =================================================
    Technical Information Management..............................            10.1              8.6              9.1
    General Reduction for Use of Prior year Balances..............            (0.1)            (0.2)  ..............
                                                                   -------------------------------------------------
          Total...................................................            10.0              8.4              9.1
    ----------------------------------------------------------------------------------------------------------------

                        statement of william d. magwood

        Senator Domenici. I think what I am going to do, Dr. Krebs,
    is let everyone testify and then ask questions. So let us
    proceed.
        I think Mr. Magwood, you are next. If you have prepared
    remarks that you do not plan to give in their entirety, they
    will be made part of the record.

                     nuclear energy, science and technology

        Mr. Magwood. Thank you, Mr. Chairman. I will try to be
    brief.
        Mr. Chairman, I am Bill Magwood, Director of the Office of
    Nuclear Energy, Science and Technology, at the Department of
    Energy. I am pleased to be here before you today to discuss our
    fiscal year 2000 budget request.
        Over the last year my office has worked very hard to focus
    and prioritize our program activities among two primary goals;
    first, to reassert U.S. leadership, nuclear technology
    nationally, second, to conduct research and other activities
    that we believe are required to prepare the country for the
    next century. I believe we have made considerable progress
    toward both goals.
        Much of our recent progress would not have been possible
    without the leadership demonstrated by this subcommittee in
    advancing nuclear research as part of the Department's
    technology portfolio. We have appreciated the interest and
    support you have shown in nuclear technologies and look forward
    to working closely with you as we continue our efforts to
    maintain a viable nuclear energy future for the nation.
        Before discussing our fiscal year 2000 request, I would
    first like to highlight a few points. I think it is important
    to reflect on some of our past accomplishments to understand
    how the federal nuclear R&D program can best serve the American
    people in the future. The Department of Energy has a rich and
    successful history in development of nuclear technologies,
    dating back to the Manhattan Project and the Atoms for Peace
    Program. Our accomplishments have benefited the nation in many
    ways.
        As we all know, nuclear power technology itself was born in
    federal research programs, but fewer people know that our
    programs have given birth to nuclear medicine, which saves
    lives and reduces health care costs, and further, as shown in
    the first chart, even after nuclear power is launched as a
    commercial business, our past work has resulted in
    accomplishments and improvements to save American rate payers
    millions of dollars every year.

                    nuclear energy research and development

        We also are very proud of our work in the advanced light
    water reactor program, which concluded a few years ago. Working
    with industry we helped make a new generation of safe reactors
    available to utilities in the United States and around the
    world. Today, three companies have brought three advanced
    nuclear power plant technologies to the market.
        Any doubt that anyone may have harbored about whether these
    technologies will perform as advertised need only to go to
    Japan or look at my next chart to see the first two advanced
    boiling water reactors in operation at the Kashiwazaki Kariwa
    Nuclear Power Station. This seven-unit facility is, I believe,
    the largest power plant of any type in the world, and it
    supplies 23 percent of Tokyo Electric's capacity.
        These advanced plants can now be routinely built in Japan
    in less than 4 years. A similar U.S. Standard plant will be
    built soon in Taiwan. Many U.S. jobs will be generated by these
    activities and by other advanced nuclear power plant projects
    in Korea and quite likely other nations over the next few
    years.
        These examples demonstrate how our past accomplishments
    have enabled the United States to maintain its leadership role
    in nuclear technology. However, the outlook for the future is
    uncertain. As you can see in this next chart, the U.S. has
    dramatically decreased its funding for nuclear R&D over the
    last 20 years. In fact, an event that reverberated throughout
    the international community, our R&D budget reached essentially
    zero in fiscal year 1998.
        This next chart shows that we have been out of step and
    out-paced by many of our economic competitors. The blame for
    this, I believe, rests largely with us. We did not change with
    the times and we did not plan well for the future, but now I
    believe we are on a positive track. I think we now know what is
    needed and what our role should be in the future.
        While we do not provide Federal research dollars overseas,
    through our research initiative, we are able to show
    considerable leadership in the international community by
    holding various discussions and meetings. Our R&D funding is
    essential in showing that we are serious and credible
    participants in the international exploration of nuclear
    technology.

                       nuclear energy research initiative

        We were very pleased that Congress approved our proposed
    Nuclear Energy Research Initiative for fiscal year 1999.
    Universities, laboratories, industry, and the international
    research community have shown great interest and excitement
    about the NERI program.
        For NERI's first year, we have received over $300 million
    worth of research proposals for work conducted over 3 years,
    and we have found that research organizations are anxious to
    reestablish cooperation with the United States through the NERI
    program. As a matter of fact, Deputy Secretary T.J. Glauthier
    met just last week with a large delegation from Japan who had a
    long list of projects they would like to cooperate with us on
    using the NERI program as the basis.
        For the coming fiscal year we are requesting a modest
    increase for NERI from $19 million in its first year to $25
    million in fiscal year 2000 to continue important work begun
    this year and initiate a modest number of new and innovative
    ideas coming from universities, our national laboratories, and
    industry.
        We are also proposing two new programs. One, the Advanced
    Nuclear Medicine Initiative, is needed to apply the
    Department's unique expertise in isotopes and large inventory
    of alpha-emitting isotopes to fight against cancer, arthritis,
    and many other illnesses.

                       nuclear energy plant optimization

        The other is the Nuclear Energy Plant Optimization [NEPO]
    program. The NEPO program is designed to conduct research and
    develop technologies that will be needed to optimize the
    efficiency and safety of today's nuclear power plants as they
    continue to operate for the long term. NEPO can help assure
    that existing operating nuclear power plants continue to serve
    our national interest by producing electricity in all weather
    conditions, while reducing harmful air emissions.
        As you can see in this chart, efficiency-enhanced nuclear
    power plants comprise the largest contribution to utility plant
    to reductions in CO2 emissions.
        The next chart demonstrates that the operation of nuclear
    plants----
        Senator Domenici. Can you leave that one up for a moment?
    What is this again?
        Mr. Magwood. This represents the pledges made by the
    utilities in the United States, leading up to the year 2000. I
    think this covered approximately a 10-year period. It shows
    that in efficiency improvements, the existing nuclear power
    plants made up 33 percent of all the pledges that utilities
    made in their reduction of CO2 emissions, compared
    to fossil plants which only contributed 14 percent, and even
    improvements in energy efficiency, which contributed 18
    percent.
        So even though we are not building nuclear power plants,
    making the existing plants more efficient has proven to be a
    major contributor to reducing offsetting CO2
    emissions.
        The next chart shows that the operational nuclear plants
    were essential to states striving to meet the Clean Air Act
    requirements. Increased generation of nuclear plants in these
    states enabled these states to meet 37 percent of the emission
    reduction targets required by the Clean Air Act. Operation
    Nuclear Plants can continue to provide these benefits into the
    middle of the next century.
        While at $5 million, our request for NEPO is very modest,
    we believe that it will enable us to demonstrate the needed
    leadership at a time of great uncertainty in the electric
    utility industry. You need only look at our joint comprehensive
    DOE Electric Power Research Institute Strategic R&D plan to see
    how even the possibility of a new DOE program in this area has
    helped the industry define and organize the long-term research
    needs for existing nuclear power plants.
        Further, industry has committed to match our investments,
    at least on a dollar-for-dollar basis, and we believe this
    effort is a vital component of our effort to maintain nuclear
    power for now and also in the long term. I would also like to
    note that we are relying more than at any other time in our
    history on independent external advice. The best example of
    this was when in October 1998, Secretary Richardson established
    the Nuclear Energy Research Advisory Committee, or NERAC, to
    help us plan for the future.

                   nuclear energy research advisory committee

        As you can see in this last chart, we have 28 independent
    prominent individuals on NERAC, including experts in fields
    such as nuclear technology, medicine, education, policy,
    economics, and non-proliferation. NERAC is chaired by Dr. James
    Duderstadt, a former professor and President of the University
    of Michigan.
        This group is working with us to develop a nuclear energy
    R&D long-term plan, a road map on the nation's nuclear science
    and technology infrastructure, and a long-term isotope research
    and production plan. In addition, NERAC has formed a special
    subcommittee to help us guide the NEPO program and plan for the
    long-term technology needs of existing nuclear power plants.
        I think you will probably note that we still have Dr. Glenn
    T. Seaborg listed, although I think we did footnote that he is
    deceased. I could not just bring myself to quite take his name
    off the list at this point, but I guess I will get around to
    that at some point, we will miss his counsel greatly.
        In closing, nuclear power and nuclear technology benefit
    Americans in many ways. U.S. nuclear plants provide a fifth of
    our electricity. Nuclear medicine is a part of every day life,
    with over 40,000 diagnostic imaging procedures performed at
    U.S. hospitals every day.
        We believe that nuclear technology can continue to benefit
    the American people in the future and with your help, support,
    and counsel, the Department will play a role in pointing the
    way.

                               prepared statement

        I know there are many issues that interest the
    subcommittee, ranging from the depleted uranium hexafloride to
    the future of Argonne National Laboratory and the Fast Flux
    test facility, and I look forward to discussing all of these
    issues with you today.
        [The statement follows:]

                    Prepared Statement of William D. Magwood

        Mr. Chairman and Members of the Subcommittee, I am William D.
    Magwood, IV, Director of the Department of Energy's Office of Nuclear
    Energy, Science and Technology. I am pleased to have this opportunity
    to present our fiscal year 2000 budget request to you today. As you
    know, this is my first time before this committee as Director and I
    look forward to working with the Committee as you review our priorities
    and allocate resources for the next fiscal year.
        As we stand at the threshold of a new century, the United States
    remains the most powerful force for peace, prosperity, and democracy in
    the world. We remain a nation with abundant resources and capabilities.
    The United States remains at the forefront of technological and
    scientific advancement--ranging from air flight and space exploration,
    harnessing the atom, to medicine and computing. Throughout, government
    has been a partner in developing technology for the American people--
    meeting vital national security interests and providing for the well
    being and prosperity of the nation and its people. For the Office of
    Nuclear Energy, these interests are represented by the following
    strategic objectives:
      --providing for energy diversity and security,
      --developing Department of Energy mission critical technologies,
      --maintaining vital nuclear research facilities and supporting a
            strong knowledge base for nuclear technology in the 21st
            century, and
      --securing our nation's environmental future.
        This program has a rich history, dating back to the Manhattan
    Project and the Atoms for Peace Program. For over 50 years, we have
    supported research and development that produced the prototypes for
    reactor technologies that are in commercial use throughout the world
    today. Similarly, for over 50 years, the Department, with its
    infrastructure of reactors, accelerators, and hot cells, has developed
    and brought to the American people, vital isotopes used for medicine,
    research and industrial applications. Today, we are working in
    partnership with clinicians, researchers, and industry to respond to
    the needs of the 21st century. For almost 40 years, we have produced
    radioisotopic generators and heat sources for space and for national
    security missions--missions that we expect to continue well into the
    next century. And as leaders in development and operation of nuclear
    reactor technology, for over 50 years we have managed the safe
    operation of nuclear energy's research reactors. Today, we support the
    important work of the Office of Science and others by managing the safe
    operation of all of the Department's research reactors. Finally, we
    take seriously our stewardship responsibilities associated with prior
    missions of Nuclear Energy, Science and Technology and our landlord
    responsibilities at the Test Reactor Area at the Idaho National
    Engineering and Environmental Laboratory and the former government
    gaseous diffusion sites.
        Overarching our strategy for the 21st century is the fundamental
    belief that the United States must retain its leadership position in
    nuclear energy--to be a player in shaping the international landscape
    and advancing the interests of the American people at home and abroad.
                          roadmap for the 21st century
        Our strategic framework, which flows down from the President's
    National Security Strategy for a New Century, October 1998 and the
    Department's Comprehensive National Energy Strategy, April 1998,
    provides the basis for our fiscal year 2000 budget request. In
    addition, the resources applied to implement this strategy are shaped
    in part by the recommendations of the President's Committee of Advisors
    on Science and Technology (PCAST) \1\ and by the response to these
    recommendations provided by the laboratory directors of seven of our
    national laboratories.\2\
    ---------------------------------------------------------------------------
        \1\ The President's Committee of Advisors on Science and
    Technology, Federal Energy Research and Development Challenges of the
    Twenty-First Century, Report of the Energy Research and Development
    Panel, November 5, 1997.
        \2\ U.S. Department of Energy National Laboratory Directors,
    Recommendations for a Department of Energy R&D Agenda, December 1997.
    ---------------------------------------------------------------------------
        In 1997, the PCAST panel on Federal Energy Research and Development
    (R&D) identified nuclear energy as one of the technologies that could
    alleviate global climate change and address other energy challenges,
    including reducing dependence on foreign oil, diversifying the U.S.
    domestic electricity supply system, expanding exports of U.S. energy
    technologies, and reducing air and water pollution. PCAST recommended
    that the Department establish nuclear energy R&D programs initially
    funded at $60 million, growing over five years to over $100 million.
    Although our funding levels do not approach the levels recommended by
    PCAST, we are optimistic about the future of our nuclear energy
    research and development activities as we demonstrate the value of this
    work to the Nation. Today, the Office of Nuclear Energy, Science and
    Technology remains focused on its core R&D missions and we are working
    hard to establish meaningful plans and direction for the future.
        This past October, Secretary of Energy Richardson established the
    Nuclear Energy Research Advisory Committee (NERAC) to provide advice to
    the Department on the direction of our nuclear technology and research
    programs in the 21st century. This committee, chaired by Dr. James
    Duderstadt, former President of the University of Michigan, is
    comprised of 28 eminent senior policy, science and technology experts
    from academia, industry, and our national laboratories with expertise
    ranging from reactor operations and nuclear engineering to biological
    sciences and nuclear medicine, to environmental sciences, economics and
    strategic planning. The membership of this committee is diverse,
    including an environmental advocate, senior officials from industry,
    researchers in nuclear medicine, laboratory directors, and a former
    Member of the Senate.
        As their initial charges, I have asked this group to help us
    formulate our Nuclear Science and Technology Infrastructure Roadmap, to
    help us develop long-term plans for our nuclear energy research program
    and our medical isotope production and research programs, and to help
    us identify the technology needs of current U.S. nuclear power plants.
        This spring, the NERAC will complete the Nuclear Science and
    Technology Infrastructure Roadmap, evaluating our present and future
    requirements for neutron generating facilities and assessing the
    viability of our existing infrastructure of hot cells, accelerators,
    and reactors to meet the Nation's needs for basic science research,
    applied technology research, national security, space nuclear power,
    and isotope production and related missions over the next 20 years.
    This roadmap represents the first step in managing our long-term
    nuclear R&D infrastructure and in the short-term, it is an important
    tool in balancing future missions at our nuclear R&D facilities and in
    identifying strengths and weaknesses in our current infrastructure.
    Additionally, Secretary Richardson has tasked NERAC to provide in the
    roadmap, their recommendations on whether the Fast Flux Test Facility
    should be considered to meet the Nation's requirements for isotope
    production or other important and enduring missions of the Department.
        The expertise of NERAC is deep and their mandate broad, ranging
    from helping us to define the direction and character of our future
    programs, to providing independent oversight of our research programs,
    to providing recommendations on our priorities.
                  providing for energy diversity and security
        Today, as in the past, our research and development initiatives are
    the centerpiece of our program. Although our focus has changed over
    time, our R&D is based on the fundamental belief that nuclear energy
    and technology is and will remain an important element in our energy
    mix and will continue to provide important technological benefits and
    advancements for the nation. Today, with increasing pressure to reduce
    the discretionary spending and with R&D dollars more constrained in
    both government and industry, we must adopt new approaches to advance
    nuclear technology--through leveraging our federal R&D dollars with
    others and greater collaboration among our universities, our
    laboratories, and the private sector--to get the best return on
    investment for the nation. And to further leverage our investment, I am
    committed to expanding international cooperation.
        Today, 104 reactors are operating to provide about 20 percent of
    the electricity generated for the American people. This is the second
    largest source of electricity behind coal. As we look to the future,
    these plants are critical to maintaining compliance with our existing
    emission laws and to assuring the nation maintains a flexible portfolio
    of energy supply options. By 2010, about 10 percent of plants will
    reach the end of their operating lifetimes, about 50 percent by 2020,
    and the remainder by 2030. Re-licensing and extending operations for
    these plants for another 20 years can have a dramatic impact on
    sustaining generating capacity, with the added benefit of offsetting
    carbon emissions from other sources. Without re-licensing, we face a
    significant decrease in capacity and dramatic increases in emissions in
    the near term. With the right strategies by government and industry,
    these plants can continue to operate safely, reliably, and efficiently
    well into the next century.
        As you know, in the 1980's and 1990's, Congress funded nuclear
    energy research that the Department cost-shared with industry to
    develop the advanced light water reactors, a program established to
    ensure the viability of nuclear energy and to advance energy security
    and diversity in the 21st century. Today, three vendors have brought
    two ``evolutionary'' designs and one ``passive design'' technology to
    commercialization, with the first two advanced boiling water reactors
    in operation today overseas. In November, I visited the Kashiwazaki
    Kariwa Nuclear Power Station, where the first General Electric Advanced
    Boiling Water Reactors are operating. An impressive sight, this is the
    world's largest nuclear power station, with seven units supplying about
    23 percent of Tokyo Electric's total capacity. In addition, the two GE
    boiling water reactors represent today's state-of-the-art technology.
    [GRAPHIC] [TIFF OMITTED] T10AP13.001

        Today, with the completion of the advanced reactor design program,
    our R&D initiatives are focused on two primary areas:
      --The Nuclear Energy Research Initiative (NERI), a new program funded
            in fiscal year 1999 by the Congress at a level of $19 million,
            aimed at reducing the barriers to the long-term use of nuclear
            energy at home and abroad. I am pleased to report to you that
            the response to this program has been exceptional. The
            Department received 307 proposals for this program,
            representing over $300 million in potential research. We are
            not only pleased with the number of proposals, but with the
            teaming occurring among the laboratories, our universities, and
            industry and with the innovative ideas coming forward. In
            fiscal year 2000, we are requesting an increase of this program
            to $25 million, to continue the important work begun this year
            and for a modest increase in the number of proposals that can
            be selected.
      --The Nuclear Energy Plant Optimization (NEPO) program, a new program
            in fiscal year 2000 to meet our national interest for safe,
            secure, and reliable access to energy in the 21st century.
            These plants are significant to our nation's energy portfolio
            and represent a critical infrastructure that is needed beyond
            the timeframes under which the existing plants are licensed.
            This program, aimed at reducing barriers to efficient and safe
            operation--increasing plant capacity from 71 percent in 1997 to
            85 percent in 2010 and addressing issues associated with plant
            aging--would be 50-50 cost-shared with industry through the
            Electric Power Research Institute, guided by a joint EPRI/DOE
            strategic plan, and coordinated with the Nuclear Regulatory
            Commission.
        These initiatives are based on the recognition of a clear
    distinction between the respective roles of government and industry in
    advancing nuclear technology in the 21st century. Industry must
    continue to carry the burden of short term research and they are
    meeting this challenge very well with an investment well in excess of
    $100 million annually. On the other hand, there is a clear role for the
    Department in providing for the longer term research of initiatives
    such as NERI and working with industry to fill the void on intermediate
    term research--research equally needed to protect our critical energy
    supply infrastructure.
                        developing department of energy
                         mission critical technologies
        For well over 50 years, we have been developing, producing, and
    delivering hundreds of types of stable and radioactive isotopes for
    research, industrial applications, and for medicine. The dramatic
    advancements made in nuclear medicine during the second half of this
    century are, in large part, because the Department and its predecessors
    had the foresight to pursue development of isotopes as a mission that
    was ancillary to other historical missions of the Department.
        In medicine alone, the application of stable and radioactive
    isotopes for research, diagnosis, and therapies is an indispensable and
    growing component of our health care. Isotopes reduce health care costs
    and improve the quality of patient care. Each day, 40,000 patients
    benefit from isotope-based medical imaging techniques. In industry,
    isotopes are used for a multitude of applications, ranging from
    radiography, to sterilization of medical instruments, to lasers and
    smoke detectors. The NERAC projects that demand for medical isotopes
    can be expected to increase between 8 and 17 percent per year over the
    next 20 years.
        Today, and in the future, our mission remains focused on bringing
    new and improved isotope applications, products, and services to the
    American people for use in medicine, industry, and research and on
    assuring that a reliable supply of isotopes exists for the nation. This
    program operates with a revolving fund, with about two-thirds derived
    from federal appropriations and one-third from annual sales. It is our
    policy to aggressively pursue opportunities for private sector
    involvement in production, distribution, and sales of isotopes,
    particularly commercial isotopes, and we have successfully privatized
    several key operations, which previously had required a federal
    appropriation. These privatizations allow us to decrease our cost of
    operations while providing a revenue stream from the royalties derived
    from the privatization.
        In the last two years, we completed two important privatizations--
    one, of hot cell facilities for production and processing of iridium-
    192 and other isotopes in Idaho and another, of a technology developed
    and patented by the Department for production of a promising new cancer
    isotope, yttrium-90, derived from strontium left over from weapons
    production at Hanford. Although each of these privatizations were
    different, both are examples of DOE doing what it does best--developing
    an isotope for treatment of devastating illnesses or for other
    applications--and industry doing what they do best--bringing the
    product to market with no additional cost to the taxpayer.
    [GRAPHIC] [TIFF OMITTED] T10AP13.002

        In fiscal year 2000, we are requesting funding to continue the
    construction of the beam spur at the Los Alamos Neutron Science Center
    (LANSCE) facility so that it can be accomplished while the facility is
    in an outage and can come on line in fiscal year 2001 with no
    significant interruption in the supply of isotopes. The beam spur
    enables us to continue to provide vital short lived isotopes that can
    only be produced in an accelerator of this size.
        By the end of this fiscal year, modifications to the Annular Core
    Research Reactor and associated Hot Cell Facilities at Sandia National
    Laboratories will be completed and the facilities will be ready for
    private sector use as a backup source of molybdenum-99, a precursor
    isotope to the most widely used diagnostic imaging isotope, technetium-
    99m . With this accomplishment, the goal of achieving the capacity for
    an emergency backup supply will be met and no appropriation in fiscal
    year 2000 is requested.
        Lastly, we propose to launch the Advanced Nuclear Medicine
    Initiative, a new program for fiscal year 2000, to apply the
    Department's unique expertise and capabilities in isotopes to advance
    nuclear medicine technology. This initiative will sponsor nuclear
    medical science through university scholarships and internships in
    nuclear medicine and support peer-reviewed research including use of
    the Department's large inventory of alpha-emitting isotopes available
    from DOE to fight a spectrum of illnesses, including various types of
    cancer. This initiative responds to a need not currently addressed by
    existing Departmental programs.
        Additionally, we will continue to provide safe, proven, reliable,
    maintenance-free radioisotope power systems for use in deep space and
    national security applications as we have for 38 years. In 1997, the
    National Aeronautics and Space Administration (NASA) launched the
    Cassini spacecraft to Saturn using electric power from radioisotope
    thermoelectric generators provided by the Department. Previous NASA
    space exploration missions that have used radioisotope power systems
    include the Apollo lunar module and the Pioneer, Viking, Voyager,
    Galileo and Ulysses, Cassini and Mars Pathfinder spacecrafts.
        Future NASA missions will require even lighter, lower power
    systems, more efficient energy conversion, and new materials. Efforts
    are underway to meet this requirement by developing an Advanced
    Radioisotope Power System that uses a new technology. In fiscal year
    2000, the program will complete fabrication and initiate testing of
    module units of this technology, proceed to design and fabrication of a
    full-scale qualification unit. In fiscal year 2000, we will continue to
    develop the state-of-the-art power supplies that could cover a range of
    power levels required to support future NASA space missions. These
    technologies include advanced conversion concepts, new materials, and
    heat source technologies. Potential new NASA missions over the next six
    to eight years requiring radioisotope power systems include missions to
    Mars, Europa, and Pluto and the Solar Probe mission to the Sun.
        Because our supply of plutonium-238 used in these systems will be
    exhausted in the first half of the next decade, we are conducting an
    environmental impact analysis. The EIS on re-establishing a plutonium-
    238 production capability will be completed early in fiscal year 2000.
    Facilities at Oak Ridge, Idaho, and Hanford are currently being
    evaluated and the Department has also sought expressions of interest
    from the private sector for irradiation services. Additionally, we are
    currently evaluating whether assembly and test operations performed at
    the Mound Site should remain at Mound or should be transferred to
    another site.
                        developing department of energy
     maintaining vital nuclear research facilities and supporting a strong
                           educational infrastructure
        Government, industry, and academia alike face similar challenges
    today as we seek to sustain our critical nuclear science and technology
    infrastructures--our facilities and our human resources. Like much of
    the industrial base which took shape during and in the years following
    World War II, the nuclear industry is a mature industry, comprised of
    scientists and engineers, many of whom are currently retiring or will
    retire over the next decade. Along with this, our nuclear science and
    engineering programs at universities and colleges are challenged by
    declining enrollments and aging facilities. The Department as well
    faces these same challenges to our own workforce and our own
    facilities.
        Inextricably linked with our R&D programs are our initiatives to
    arrest the eroding nuclear energy infrastructure. Opportunities for new
    and exciting R&D serves not just to advance breakthrough technologies
    for the American people, but serves to attract the best and brightest
    to our universities, our laboratories, and our industry in general. To
    strengthen our knowledge base, in fiscal year 2000 we propose to apply
    a total of $11.3 million to enhance nuclear research and education
    programs at universities and colleges across the country. This
    Committee has been a strong proponent for this program and we have seen
    it grow over the last several years. I am pleased to submit it again at
    about the level you appropriated last year. I am also pleased to
    include in it, the Nuclear Engineering Education Research (NEER)
    program, vital to attracting and retaining faculty, at the same level
    as appropriated last year. These initiatives under the university
    programs will help ensure the future ability of the U.S. to continue to
    apply the nuclear sciences to medical research, the development of new
    materials, and future environmental and energy challenges.
        To strengthen the infrastructure at our universities and ensure
    that university research reactors are available into the next decade,
    we are proposing a modest increase in the program in fiscal year 2000
    to assist in the maintenance and modernization of university research
    reactors by replacing outdated equipment and upgrading experimental
    capabilities under the reactor upgrade activity. University research
    reactors are a little-known but essential part of the nation's
    scientific infrastructure. Currently, there are 28 university research
    reactors at 26 universities in 21 states. These research reactors have
    contributed to innumerable important scientific discoveries ranging for
    analysis of moon rocks to dating of dinosaur bones, to new methods of
    targeting and destroying rare brain tumors. Quoting John Bernard from
    the Massachusetts Institute of Technology, ``the public thinks they are
    all producing electricity, but these research reactors are much like a
    microscope. You're producing a beam of neutrons to see the world.''
        In the 1990's the Department concentrated the responsibility for
    management of the Department's reactors in the Office of Nuclear
    Energy, Science and Technology, where the core of the U.S. government's
    expertise in nuclear energy research, technology and engineering
    resides. Among the reactors under our purview are the High Flux Isotope
    Reactor, the High Beam Flux Reactor, our Annular Core Research Reactor,
    the Advanced Test Reactor (ATR), and the Fast Flux Test Facility. We
    also serve as landlord for the Test Reactor Area site at Idaho National
    Engineering and Environmental Laboratory, where the ATR is located, and
    where we are responsible for providing utility services and maintaining
    the site area in a safe and environmentally compliant configuration. As
    many of you know, there was an accident last year at the TRA during a
    maintenance operation at a facility occupied by another DOE program in
    which carbon dioxide inadvertently discharged from a fire suppression
    system. The accident caused one death and several life-threatening
    illnesses. I want to underscore the sincere regret expressed by
    Secretary Richardson when he said, ``our hearts go out to the family
    and friends of Kerry Austin.'' This is an accident that never should
    have happened and I pledge that the Office of Nuclear Energy, Science
    and Technology will work hard to ensure that safety remains at the
    forefront of all of our activities.
    [GRAPHIC] [TIFF OMITTED] T10AP13.003

        My office is also responsible for the Fast Flux Test Facility
    (FFTF), the most recently deployed reactor in the Department, operating
    between 1982 and 1992. Today, it is shutdown and maintained in standby
    and this spring Secretary Richardson will decide whether to shut it
    down permanently or pursue civilian missions for the reactor. To
    provide a more informed decision, NERAC will complete this month, the
    Nuclear Science and Technology Infrastructure Roadmap, to assess our
    present and future requirements for neutron generating facilities in
    light of our existing and currently planned infrastructure of hot
    cells, accelerators and reactors. This roadmap will include
    recommendations on whether there is a future need for FFTF to meet
    mission critical requirements.
                       securing our environmental future
        The Department is responsible for safe storage and disposal of
    approximately 8,000 tons of spent nuclear fuel containing about 2,700
    metric tons of uranium and transuranic elements from various civilian
    and defense-related programs. Some of this fuel contains materials that
    are highly reactive or are in a condition that precludes their disposal
    in a geologic repository. A technology which may someday assist the
    Department in dealing with this spent fuel challenge is the
    electrometallurgical treatment technology under development at Argonne
    National Laboratory (ANL). The demonstration of this technology will be
    completed this August on a portion of sodium-bearing spent fuel removed
    from the Experimental Breeder Reactor-II (EBR-II) located at ANLWest in
    Idaho. In fiscal year 2000, we expect to complete an Environmental
    Impact Statement on the use of this technology for the remaining EBR-II
    spent fuel as well as certain other spent fuels. In concert with this,
    we expect the National Research Council to report back to the
    Department in that same time frame with their final assessment of the
    technology. Together, these activities will provide the technical basis
    for a decision on whether to proceed with full scale operations of the
    Fuel Conditioning Facility and treatment of the fuel.
        Additionally, we will complete the processing of the sodium coolant
    from the EBR-II and Fermi-I reactors in fiscal year 2000, enabling us
    to shut down the last of the EBR-II facilities, with the exception of
    the Fuel Conditioning Facility, used for the demonstration project. It
    will be retained in standby pending a decision on treatment of the
    remaining sodium bonded fuel.
        My office is also responsible for important activities related to
    the Federal uranium enrichment program that were not transferred to
    USEC, Inc. when it was privatized in July 1998, including, sale of
    surplus natural assay uranium and management of the about 57,000 14-ton
    depleted uranium hexafluoride cylinders located at the gaseous
    diffusion sites in Paducah, Kentucky; Portsmouth, Ohio; and the Oak
    Ridge Site in Tennessee. For the past several years, we have worked to
    improve storage conditions for the cylinders through inspections,
    maintenance, and monitoring. As required by Public Law 105-204, signed
    by the President last July, the Department is required to prepare a
    plan to begin by January 31, 2004, construction of plants at Portsmouth
    and Paducah to treat and recycle the depleted UF6 inventory.
    The initial plan was submitted to this Committee on March 12, 1999. The
    final plan will be submitted in May and we are confident it will meet
    the intent expressed by Congress in the enacted legislation.
        Mr. Chairman, Nuclear Energy's fiscal year 2000 funding request is
    outlined in the following table:

                                Budget Authority

                             [Dollars in Thousands]

            Program Element Request                         Fiscal year 2000

    Nuclear Energy R&D............................................   $87,345
                        ==============================================================
                        ____________________________________________________
        Advanced Radioisotope Power Systems.......................    37,000
        Test Reactor Area.........................................     9,000
        University Reactor Fuel Assistance and Support............    11,345
        Nuclear Energy Research Initiative........................    25,000
        Nuclear Energy Plant Optimization.........................     5,000
                        --------------------------------------------------------------
                        ____________________________________________________

    Isotope Support...............................................    21,000
    Termination Costs.............................................    65,000
    Fast Flux Test Facility.......................................    30,000
    Uranium Programs..............................................    41,000
    Program Direction.............................................    24,960
                        --------------------------------------------------------------
                        ____________________________________________________

          Total nuclear energy, science and technology request....  $269,305

        I will now provide the Committee with greater detail regarding the
    importance of our programs and the benefits they provide.
                 nuclear energy research and development (r&d)
        The mission of the Nuclear Energy R&D program is to conduct
    advanced research and development in areas such as nuclear power and
    space power systems. In addition, this program supports nuclear
    engineering education and enhancement of the Nation's nuclear science
    infrastructure. It also supports the infrastructure needs for the Test
    Reactor Area at the Idaho National Engineering and Environmental
    Laboratory (INEEL).
                      advanced radioisotope power systems
        The Department of Energy and its predecessor agencies have provided
    radioisotope power systems for use in space and terrestrial
    applications for 38 years. These systems are safe, proven, reliable,
    maintenance-free, and capable of producing either heat or electricity
    for many years under the conditions required for deep space and
    national security missions. The unique characteristics of these systems
    make them especially suited for applications where large arrays of
    solar cells or batteries are not practical, for example, at large
    distances from the sun where there is little sunlight or in harsh
    environments. To date, the Department has provided over 40 radioisotope
    power systems for use on a total of 25 spacecraft. In fiscal year 1998,
    NASA launched the Cassini spacecraft to Saturn, entirely electrically
    powered by three radioisotope thermoelectric generators provided by the
    Department. Critical national security activities and NASA missions to
    explore deep space and the surfaces of planets could not occur without
    these systems.
        In fiscal year 2000, the program will continue developing new,
    state-of-the-art power supplies required to support both future NASA
    space exploration, such as a mission to Jupiter's moon Europa, a
    mission to Pluto, and the Solar Probe mission to the Sun, and national
    security applications. In keeping with NASA's new philosophy of
    smaller, lighter weight and more technologically advanced spacecraft,
    these future NASA missions will require lower power, highly efficient
    lighter radioisotope power systems. In fiscal year 1998, DOE initiated
    the development of the next generation radioisotope power system, using
    a more efficient energy conversion technology to achieve a lighter
    weight, more efficient power system. In fiscal year 2000, the focus
    will be completing the design of the new system and proceeding to
    fabricate a flight qualification unit to more accurately assess its
    performance against NASA needs.
        The outyear planning for future space missions reflects
    arrangements with the national security users and NASA that the
    Department will sustain the facility infrastructure to produce
    radioisotope power systems. This infrastructure represents the sole
    national capability to produce radioisotope systems. In accordance with
    arrangements with our customer agencies, NASA or other users will
    provide funds to the Department to pay for mission-specific costs,
    including mission-specific development, hardware fabrication, and other
    mission support costs.
        A key factor in the ability to provide radioisotope systems for
    future missions is to have an adequate supply of the radioisotope Pu-
    238 that is used in all of these systems. It is very important to note
    that Pu-238 is not weapons-grade material and is not usable as an
    explosive in nuclear weapons. The current inventory of this isotope,
    with the exception of approximately nine kilograms that were purchased
    from Russia, was produced in the Savannah River reactors and processed
    in the HB-Line facilities that are shutdown or are in the process of
    being shut down. For the long-term, the Department has initiated an
    environmental analysis to evaluate sites for supporting domestic
    production of Pu-238. Sites to be evaluated include DOE's Hanford Site,
    the INEEL, and the Oak Ridge National Laboratory.
        The Department is currently analyzing whether the assembly and test
    operations performed in Building 50 at Mound should be retained at the
    Mound Site or whether the functions should be moved to another site. As
    you know, this site is being environmentally restored by DOE's Office
    of Environmental Management and they plan to turn the site over to the
    private sector and exit the site in 2005. In general, it is the
    Department's policy to reduce our footprint where it can be
    demonstrated to produce a savings for the taxpayer and we are currently
    reassessing the cost involved in retaining operations at Mound versus
    costs of consolidating at other sites. In the meantime, progress on the
    environmental impact statement, begun this fiscal year, will continue
    at a slower pace until we complete this important assessment.
        The Advanced Radioisotope Power Systems Program is an important
    part of the nuclear energy research and development efforts, and the
    Department will continue to manage this program in an effective and
    cost-efficient manner. We are submitting a report to Congress
    summarizing the status of actions taken to streamline the program. In
    conjunction with the user agencies, the Department will responsibly
    maintain the capability to supply these systems for future missions
    that are important to the exploration of space and vital to U.S.
    national security interests.
                           test reactor area landlord
        The Office of Nuclear Energy, Science and Technology is responsible
    for the landlord program for the Test Reactor Area of the INEEL. The
    TRA Landlord Program provides essential services to the Advanced Test
    Reactor (ATR) and its related facilities, including the ATR Critical
    Facility reactor, the TRA Hot Cells that were recently privatized for
    isotope production, and the INEEL Applied Engineering and Development
    Laboratories, as well as a machine shop that supports the entire site.
    These facilities are operated primarily to support vital nuclear
    reactor testing and materials testing for the Office of Naval Reactors,
    but are also operated for other programs, including our isotope
    program. This area of the site is expected to continue to perform
    national security and civilian missions well into the 21st century. As
    such, we must protect this critical infrastructure--maintaining
    facilities and services at a level that ensures protection of the
    workers and the public, the environment and minimizes programmatic
    disruptions.
        In fiscal year 2000, we are requesting $9 million for the landlord
    program, a $2.3 million increase over last year. Most of the increase
    is directed to ensuring that we meet commitments in managing our legacy
    waste and in continuing the electric utility line item project, which
    will be completed in 2003. The electrical utility project reconfigures
    the 40 year old electrical utility system to meet current needs and
    replace aged switchgear, panels, and transformers for which replacement
    parts are not available or which have reached the end of their useful
    lifetime and are not economical to repair. Additionally, we will
    continue the fire protection upgrade line item in fiscal year 2000, at
    a lower level than previous years, and then with a slightly increased
    level of effort the following year to bring it to completion. The fire
    protection line item was initiated several years ago to retrofit
    existing facilities to meet provisions of the National Fire Protection
    Agency's Life Safety Code and provide an adequate level of protection,
    as needed, for building occupancy. We feel that this project is
    particularly important in light of the suppression system- related
    accident that occurred last year in this area of the site.
                       nuclear energy research initiative
        World leadership in nuclear science and technology is vital to the
    United States from the perspective of national security, international
    influence, and global security. The United States has more nuclear
    power plants in operation today than any other nation in the world and
    most of the world's operating nuclear power plants are based on United
    States technology. Many countries, especially the fast-growing
    economies in Asia and the Pacific Rim, are interested in building new
    plants using our designs. Given the projected growth in global
    electrical energy demand as developing nations industrialize, our vital
    strategic interests in addressing global climate change, nuclear
    nonproliferation, nuclear safety, and economic competitiveness, and our
    need to satisfy the growing domestic needs for energy in an
    environmentally responsible manner, the United States must maintain its
    scientific and technological leadership in nuclear energy.
        Recognizing this need, the PCAST Panel on Federal Energy Research
    and Development recommended in 1997 that the Department establish a new
    nuclear energy research effort to address the key issues affecting
    nuclear energy's potential as a future energy source. The key issues
    affecting nuclear energy's future include disposal of spent fuel,
    concerns about nuclear proliferation, plant safety and uncompetitive
    economics. PCAST recommendations are that the Department competitively
    select, through a peer-review process, proposals from universities,
    national laboratories and industry to conduct scientific and
    engineering research in the areas of proliferation-resistant reactors
    and fuel cycles; new reactor designs with higher efficiency, lower
    cost, and improved safety; lower output reactors for use in the global
    market; and new techniques for the management and storage of nuclear
    waste.
        The Department's Office of Nuclear Energy, Science and Technology
    implemented the PCAST recommendations in fiscal year 1999 by
    establishing the Nuclear Energy Research Initiative (NERI) to fund new
    and innovative scientific and engineering research on these key issues
    and to preserve our nation's nuclear science and technology leadership.
    The initiative has as its primary mission the advancement of nuclear
    science and engineering research over the long-term.
        We are very pleased with the response to the NERI program. The
    Department received 307 final proposals from national laboratories,
    universities, and industry, representing over $300 million in potential
    research. Additionally, a significant fraction of the proposals
    submitted by the national laboratories included teaming with
    universities and others. These individual and collaborative research
    proposals are being peer-reviewed by independent experts for scientific
    and technical merit and will be evaluated for relevance to the
    Department's nuclear energy objectives prior to funding selection. The
    process by which grants are awarded under NERI is modeled after other
    successful investigator-initiated independent peer review processes,
    such as those used by the National Science Foundation and DOE's Office
    of Science. As with all of the nuclear research programs, the NERI will
    receive guidance from the Nuclear Energy Research Advisory Committee.
        The Department strongly supports the continuation of this vital
    scientific and engineering research effort in fiscal year 2000 and we
    request $25 million for this program, an increase of $6 million over
    fiscal year 1999 to continue important research begun this year and to
    award a modest number of new proposals in fiscal year 2000. In doing
    so, we seek to address key obstacles affecting the expanded future use
    of nuclear energy in the U.S.; advance the state of nuclear technology
    to maintain our competitive position in overseas and future domestic
    markets; promote and maintain nuclear science and engineering
    capabilities to meet future technical challenges; and improve the
    performance, efficiency, proliferation resistance, reliability, and
    economics of nuclear energy applications.
                   nuclear energy plant optimization program
        Over the last couple of years, there have been significant changes
    in the strategic landscape--a growing recognition of the importance
    that our existing nuclear power plants play in meeting the needs of the
    nation for electricity during the first half of the next century and
    their importance in meeting international commitments on climate
    change. These plants are also critical to helping utilities meet state
    implementation plans and EPA requirements for Clean Air Act compliance.
        Two years ago, with electricity restructuring looming and concerns
    over regulatory uncertainty, the prediction was that the existing
    nuclear plants were doomed--that fewer plants would seek license
    extensions and that many would shut down prematurely. Today, with
    consolidations in ownership occurring and several plants announcing
    their intention to seek license extensions, it is clear that there is a
    future for many of the U.S. nuclear power plants. However, for these
    plants to remain viable beyond 2020, both government and industry must
    take action--government reducing regulatory and other barriers to
    operation and industry, investing capital in the upgrading their
    facilities for the future and investing in short-term R&D. Also,
    together, government and industry should explore intermediate-term
    evolutionary technologies to sustain these plants. For these reasons,
    the Department is resubmitting its proposal for the Nuclear Energy
    Plant Optimization (NEPO) program in fiscal year 2000 to address the
    issues that could prevent continued operation of existing U.S. nuclear
    power plants.
        The DOE Energy Information Administration projects that even with
    aggressive energy efficiency measures, U.S. electricity consumption
    will increase 1.4 percent per year through 2020 the equivalent of seven
    large 1000-megawatt power plants each year. During this same period,
    about 127,000 megawatts of existing electricity generating capacity
    could be retired because of age, competitive pressures, and as part of
    U.S. utility measures to meet clean air standards. In order to meet the
    demand for new baseload capacity, the Energy Information Agency
    estimates that the U.S. would need to build the equivalent of over
    1,000 new fossil plants by 2020. This magnitude of building would
    require a huge economic investment over the next 20 years with the
    potential for significant increases in air emissions.
        However, continued operation of our existing nuclear power plants
    can mitigate this need and dramatically reduce or offset air emissions.
    For example, continued operation of 90 percent of the existing nuclear
    power plants through their current license terms would displace over
    3,950 million metric tons of carbon emissions between 1995 and 2035.
    Extending the licenses of 75 percent of these nuclear plants could
    reduce emissions by 64 million metric tons between 1995 and 2010, 208
    million metric tons by 2015, and 2260 million metric tons by the middle
    of the next century, when the last existing plant would shutdown.
        The Department's Nuclear Energy Plant Optimization (NEPO) program
    is proposed to address issues associated with operating existing
    nuclear power plants, in cost-shared cooperation with the Electric
    Power Research Institute (EPRI) and in coordination with the Nuclear
    Regulatory Commission. As a collaborative program, industry would share
    a minimum of 50 percent of the cost and the program would be guided by
    a joint DOE/EPRI strategic plan. The proposed program would involve the
    nation's national laboratories, universities, and industry and although
    no federal research dollars would be allocated internationally, the
    program would benefit from substantial international collaboration and
    coordination.
        Specifically, we propose the following R&D initiatives:
        Managing the long-term effects of nuclear plant aging.--R&D
    conducted under NEPO would provide a better understanding of material
    degradation mechanisms and how they occur, enabling development of
    cost-effective aging management strategies which will provide
    capabilities to easily prevent, detect, or repair the degradation.
        Improving nuclear power plant capacity factors from 71 percent in
    1997 to 85 percent in 2010.--This initiative focuses on improving the
    long-term economic performance of current plants through development of
    technologies that will improve equipment reliability, lower operating
    costs, and increase power output while maintaining high levels of
    safety.
        Optimizing power generation through efficiency and productivity
    improvements.--Current nuclear plants were designed and are operating
    with technology developed over 25 years ago. As plants age, components
    and parts degrade or become obsolete, introducing inefficiencies, added
    costs, and unreliability. There have been significant technology
    advancements over the last 25 years that are applicable to power
    generation, particularly in computers, communications, materials,
    sensors and digital electronics, and artificial intelligence that
    provide more accurate, reliable and cost-effective technologies;
    however, most of these technologies are not qualified to meet Nuclear
    Regulatory Commission requirements. Further R&D developments will
    produce new technology applications that meet regulatory requirements
    and that will improve plant operation and maintenance, increasing
    overall plant output. This initiative is focused on demonstrations of
    technologies necessary to achieve regulatory acceptance of the new
    technologies.
        Research performed under this program would be prioritized by the
    NERAC subcommittee on operating nuclear power plant research,
    coordination and planning.
                 university reactor fuel assistance and support
        The Department of Energy's University Nuclear Science and Reactor
    Support Program conducts the important task of supporting nuclear
    science education and research in the United States. Under this
    program, we work with universities and colleges across the nation, with
    assistance from private industry, to maintain nuclear education
    programs, support outstanding students, undertake innovative nuclear
    engineering research, and continue the operation of research reactors.
    Much of the program funding is used to provide fresh fuel to these
    reactors, to remove spent fuel, and to upgrade the operational
    capabilities at the university research reactors at 26 universities in
    21 states.
        To ensure that these valuable educational tools remain available
    into the next decade, in fiscal year 2000, for the third straight year
    we plan to support U.S. universities and colleges in their efforts to
    modernize reactor safety systems and improve their operational
    capabilities. These reactors are critical and unique assets of the U.S.
    scientific infrastructure. They are used for educational purposes, to
    conduct important medical and materials research, and to make vital
    isotopes. In fiscal year 2000, we will continue to supply fresh fuel
    to, and transport spent fuel from, universities requiring assistance.
    In addition, we will continue converting university reactors that
    currently use highly enriched uranium fuel to low enriched uranium
    fuel, thus advancing our nonproliferation goals. Additionally, through
    our reactor sharing program we will provide a means for students at
    universities without reactors to have access to another university's
    reactor for education, training, and research purposes.
        We will continue the very important and successful Nuclear
    Engineering Education Research grants initiative that provides much
    needed funding to faculty for innovative research at universities at
    the same level of funding you appropriated in fiscal year 1999. This
    program is vital to the research needs of the U.S. universities'
    nuclear engineering departments and, in particular, to attracting and
    retaining faculty.
        We plan to maintain our growing number of partnerships with the
    electric utility industry and other private sector entities by
    providing research grants to universities that receive similar
    commitments from the utilities and private companies. As in the past,
    we intend to provide funding equal to the amount contributed by private
    organizations, to a maximum of $50,000 in Department of Energy grants
    per university. In fiscal year 2000, we expect to fund $800,000 in
    grants to 17 universities that will be matched by participating
    companies.
        We also plan to continue our support of scholarships for
    outstanding students in undergraduate and graduate nuclear engineering
    and health physics programs at our universities and colleges, including
    fellowships for outstanding students at our minority institutions.
    These fellowships and scholarships provide for the education of
    approximately 18 outstanding graduate engineering students across the
    country and approximately 62 undergraduate students. We will continue
    an initiative, begun in fiscal year 1999, which provides practicums at
    national laboratories for 30 undergraduates in their junior or senior
    year, thus giving them valuable real-world experience in nuclear
    engineering. In fiscal year 2000, we will begin an initiative to
    support nuclear engineering recruitment activities in conjunction with
    professional societies to ensure a highly informed group of college
    freshmen enter university nuclear engineering and related scientific
    courses of study. Also, we will continue a radiochemistry initiative
    begun this year to help educate a new generation of radiochemists,
    prepared to address the technical challenges associated with operating
    nuclear plants.
                                isotope support
        Our isotope program develops, produces, sells, leases, and ships
    hundreds of different stable and radioactive isotopes for medical
    applications, scientific research, and commercial use throughout the
    United States and to approximately 25 other countries. Consistent with
    our mandate in the Atomic Energy Act of 1954, it is our longstanding
    policy to produce isotopes when no domestic or private sector
    capability exists; where unique government production facilities are
    needed, such as nuclear reactors and isotope enrichment facilities; or
    where other productive capacity is insufficient to meet the Nation's
    needs. Over the last several years, we have aggressively pursued
    private sector investment in new isotope production ventures and in
    fiscal year 2000, we will complete privatization of our commercial
    isotope production activities, including privatization of our business
    functions. In instances where the private sector can produce isotopes
    more efficiently than the government, we will sell, lease, or license
    existing facilities, technologies and inventories for commercial
    purposes.
        The isotope program operates with a revolving fund and maintains
    financial viability through revenues from sales and annual
    appropriations. We function like a business, and as such, must have
    sufficient operating cash to fill customer orders and maintain solvency
    during market changes. Our fiscal year 2000 budget request, which funds
    about two-thirds of the program, will provide the minimum necessary
    operating cash. The revolving fund is audited annually by an
    independent public accounting firm, KPMG Peat Marwick, and since the
    first audit in 1992, the isotope program has continuously received an
    unqualified opinion which states that the financial statements are
    presented fairly in all material respects. The audited financial
    statements are an essential management tool for the Isotope Program.
        Although we are not obligated to provide all isotopes requested, we
    strive to meet our customers' requests subject to inventory, production
    capability, and financial constraints. This fiscal year, to obtain a
    better understanding of our customers' requirements, a panel of medical
    experts convened to develop a consensus on the growth of demand for
    medical isotopes between now and the year 2020 and to identify future
    support the Department of Energy will need to provide to the nuclear
    medical community. The panel's report has been accepted by NERAC as the
    basis for its development of a long-term isotope research and
    development plan. The report indicates that the need for medical
    isotopes used in diagnostics, therapy, and research will increase
    between 8 and 17 percent per year over the next 20 years. Although the
    cost of meeting this demand is not insignificant, it is a fraction of
    that which would be saved in health care costs by the use of isotopes
    for diagnosis and treatment.
        The isotope program has negotiated a number of cooperative
    arrangements with foreign suppliers, to assure an uninterruptible
    supply of isotopes in the U.S. For example, in 1997 we completed a
    cooperative production agreement with the Institute for Nuclear
    Research (INR) in Troitsk, Russia, for production of strontium-82,
    which was followed by FDA qualification of the Russian strontium-82 in
    1998. This agreement resulted in the supply of material to Los Alamos
    for chemical processing and eventual distribution to hospitals at a
    time in which no large accelerator, necessary for strontium-82
    production, was operating in the U.S. We are making similar cooperative
    efforts for reactor-produced isotopes.
        Because until recently the United States was dependent on a single
    supplier of molybdenum-99, a major initiative of the past several years
    has been to bring our facilities at Sandia National Laboratories--the
    Annular Core Research Reactor (ACRR) and associated Hot Cells to the
    point that emergency production of this important medical isotope could
    be established if needed. molybdenum-99 is a precursor of technetium-
    99m, an isotope used for diagnostic imaging, including body organ
    functions, in more than 36,000 medical procedures each day in the
    United States alone. This isotope allows physicians to accurately
    diagnose cancer and other diseases without resorting to exploratory
    surgery. Substantial modifications have been undertaken at these
    facilities to ensure a stable production source that is capable of
    meeting part or all of the U.S. demand is available if needed.
    Modifications will be completed to both the ACRR and Hot Cell Facility
    this year that will place them in a condition where emergency
    production of molybdenum-99 could be constituted if needed. The demand
    for molybdenum-99 continues to grow due to the application of this
    cost-saving diagnostic technique, thus making it attractive to
    privatization. For this reason, we are pursuing privatization of
    molybdenum-99 production and related business activities. A draft
    Request for Proposal (RFP) will be issued this month, followed by the
    final RFP in May 1999, with a contract award anticipated by the end of
    the fiscal year.
        Our fiscal year 2000 request includes funding for relocation of the
    Los Alamos isotope target irradiation station at the Los Alamos Neutron
    Science Center (LANSCE), a facility owned by and operated primarily for
    the Office of Defense Programs. Because of the research community's
    identified year-round need for short-lived radioisotopes that can only
    be produced in a large accelerator, we are continuing the modifications
    to the LANSCE facility to construct a beam spur that can be dedicated
    to isotope production. Without this beam spur, the nation will lose the
    ability to make certain isotopes when LANSCE shuts down later this
    year. The total estimated cost for the relocation of the LANSCE target
    irradiation station is $14 million. Conceptual design and planning
    activities for this project began in fiscal year 1998 to support
    construction of the relocated target station and tie into the
    accelerator beam, scheduled to take place in fiscal year 1999, in a
    time-frame dictated by Defense Programs' accelerator maintenance
    schedule. By the end of fiscal year 2000, construction should be 60
    percent complete and with the additional $8 million requested, the new
    station will be completed and commissioned in fiscal year 2001. The
    fiscal year 2000 funding request is essential to minimizing the time
    that the country is unable to produce these isotopes.
        Additionally, the President's fiscal year 2000 request includes a
    recommendation to establish a new program, the Advanced Nuclear
    Medicine Initiative, initially funded at $2.5 million. This initiative
    will apply the Department's unique expertise and capabilities in
    isotopes to advance nuclear medicine technology in the U.S. Under the
    initiative, the Department will sponsor nuclear medical science using a
    peer-review selection process, encourage the training of individuals in
    nuclear medicine methods by establishing scholarships and fellowships
    for nuclear medicine specialists and by sponsoring summer internships
    at appropriate institutions, and initiate a focused program to apply
    alpha-emitting isotopes to fight a spectrum of malignant diseases
    including most common cancers and infectious diseases such as
    meningitis and AIDS.
                               termination costs
        The termination costs program funds the deactivation of the
    Experimental Breeder ReactorII (EBR-II) facility located at Argonne
    National Laboratory-West (ANL-West) in Idaho. The objective of the
    program is to place the EBR-II facility and other surplus facilities at
    ANL-West in a radiologically and industrially safe shutdown condition,
    for low-cost and long-term surveillance and maintenance, pending final
    decontamination and decommissioning. The principle components of this
    program are completing the electrometallurgical treatment demonstration
    project, which will occur this fiscal year; completing processing of
    the sodium coolant from the shutdown reactor, and closing the last of
    the EBR-II facilities.
        The Department is responsible for the safe storage and disposal of
    approximately 8,000 tons of spent nuclear fuel containing about 2,700
    metric tons of uranium and transuranic elements from various civilian
    and defense-related programs. Some of these spent fuels contain
    materials or are in a condition that may preclude their direct disposal
    in a geologic repository. The electrometallurgical treatment technology
    under development at ANL is a technology that has the potential to
    assist the Department in dealing with this spent fuel challenge, a
    challenge which is unique to the Department.
        In particular, this technology may be the best way to deal with the
    sodium-bearing spent fuel removed from EBR-II. This spent fuel contains
    metallic sodium, a material which can cause an explosion when brought
    into contact with water. This spent fuel must be treated if it is ever
    to be relocated to a geologic repository. Under the Consent Agreement
    between the State of Idaho and the Department (Batt Agreement), this
    spent fuel as well as other sodium bonded fuel onsite must be removed
    from the State by 2035. Consequently, this technology may be crucial to
    the Department's success in meeting those obligations. If this
    technology is not successful, new R&D activities will have to be
    initiated to find other alternatives for treating the Department's
    sodium-bonded fuel.
        The Department will complete the electrometallurgical treatment
    demonstration this fiscal year. In fiscal year 2000, the Department
    will complete an environmental impact statement on using this
    technology. In parallel with this, the National Research Council will
    complete their review of the technology and will issue a final report
    to the Department during the first quarter of fiscal year 2000.
    Together, these activities will form the basis for a decision early in
    fiscal year 2000 on whether to proceed with this technology for
    treatment of the rest of the inventory of EBR-II spent fuel as well as
    certain other spent fuels in the Department's inventory.
        In 1994, the Department began the permanent shutdown of EBR-II and
    associated support facilities at ANL-West. During fiscal year 2000, our
    efforts to place these facilities in a radiologically and industrially
    safe shutdown condition will continue. The Sodium Process Facility,
    designed and constructed to convert the highly reactive sodium coolant
    to an environmentally acceptable form suitable for routine disposal,
    will complete its mission in early fiscal year 2000. The facility will
    be placed in a safe configuration, awaiting further deactivation and
    eventual decontamination and decommissioning. With exception of the
    Fuel Conditioning Facility, used for electrometallurgical treatment,
    all facilities will be in a shutdown configuration by the end of fiscal
    year 2000.
                            fast flux test facility
        Nuclear Energy also provides program management and technical
    direction for the Fast Flux Test Facility (FFTF) located at the Hanford
    Reservation in Washington. FFTF is a 400 megawatt thermal, sodium
    cooled reactor that operated between 1982 and 1992. Originally designed
    to provide irradiation testing of nuclear reactor fuels for the U.S.
    liquid metal reactor program, it operated for materials testing for
    fusion, space reactor, and the international fast reactor programs. In
    1992, the Department shut down the facility and placed it in standby,
    pending a decision on using the facility as a bridge for tritium
    production until an accelerator or a commercial light water reactor
    could come on line to produce tritium. In December 1998, Secretary
    Richardson announced that FFTF is not required for tritium production
    or other defense missions. However, the Secretary indicated that he
    will decide, this spring, whether to begin permanent deactivation of
    FFTF or consider using it for other missions, such as medical isotope
    production, plutonium-238 production for space missions, advanced
    materials research, and nuclear energy R&D. If so, the Department would
    initiate an Environmental Impact Statement on the potential restart of
    the facility.
        To provide a more informed decision, the Nuclear Energy Research
    Advisory Committee will complete their evaluation this spring of the
    Nuclear Energy, Science and Technology Infrastructure Roadmap. This
    road map is important not just to assessing the need for FFTF but for
    assessing the existing facilities and capabilities for neutron science
    and isotope production across the Department as well as the needs of
    the Nation over the next 20 years.
        The funding requested in fiscal year 2000 is the absolute minimum
    level required to continue to maintain the facility in a safe condition
    and in compliance with federal and state safety and environmental
    regulations. Neither the fiscal year 1999 appropriated level nor the
    fiscal year 2000 requested levels are sufficient for either option of
    beginning permanent deactivation or pursuing restart for other
    missions. Responsibility for funding FFTF standby activities
    transferred from the Office of Environmental Management to the Office
    of Nuclear Energy, Science and Technology in fiscal year 1999.
                                uranium programs
        The Office of Nuclear Energy, Science and Technology retains
    important government activities related to the Federal uranium
    enrichment program that were not transferred to the United States
    Enrichment Corporation (USEC Inc.). In particular, this program
    addresses the facility and environmental legacies associated with the
    enrichment program, management of government assets, and associated
    research and development.
        One of the principal missions of Uranium Programs activities is to
    effectively manage the Department's depleted uranium hexafluoride
    (depleted UF6) inventories. A key responsibility of the
    Department is to ensure that an estimated 46,400 cylinders of depleted
    UF6 are maintained in an environmentally responsible manner
    by conducting annual cylinder inspections, and developing and
    implementing options to repair cylinders exhibiting accelerated
    corrosion. The Department is currently evaluating alternative long-term
    management strategies for the material. In December 1997, we issued a
    draft programmatic environmental impact statement (EIS) for public
    comment, and we expect to issue the final programmatic EIS and the
    record of decision shortly.
        Maintaining safe cylinder storage in the interim requires
    substantial work, with costs ranging from $12 to $15 million per year.
    Many of these cylinders date back to the Manhattan Project and have
    been in outside storage for up to 50 years. To improve storage
    conditions, one cylinder yard has been reconstructed, and three new
    cylinder yards have been built to date. A pilot cylinder painting
    program has been completed, and 12,000 cylinders are being painted over
    3 years to reduce accelerated corrosion of the cylinders. We are also
    applying advanced technologies to facilitate inspections, detect leaks,
    and evaluate cylinder wall condition.
        In addition to appropriations received for management of DOE-
    generated depleted UF6, the Department received $66 million
    in fiscal year 1998 from the United States Enrichment Corporation (USEC
    Inc.) for the management and disposition of about 11,200 additional
    USEC-generated depleted uranium cylinders. In accordance with fiscal
    year 1999 appropriations report language, the Department submitted, on
    December 17, 1998, its initial plan for applying the $66 million
    received from USEC. These funds are administered in accordance with the
    terms of the two Memoranda of Agreement (MOAs) and related
    correspondence for activities required to accept and maintain the USEC
    material. Also, in July 1998, the President signed Public Law 105-204,
    requiring the Department to prepare a plan to begin by January 31,
    2004, construction of plants at Portsmouth and Paducah to treat and
    recycle the depleted UF6 inventory. The initial plan was
    submitted to this Committee on March 12, 1999. The final plan will be
    submitted in May 1999 and we are confident that it will meet the intent
    expressed by Congress in the enacted legislation. The Department's
    fiscal year 2000 budget requests $5 million to be used in addition to
    the MOA funds to begin activities to begin the process of constructing
    depleted UF6 conversion plants.
        Other Uranium Programs activities at the gaseous diffusion plants
    in Portsmouth, Ohio; Paducah, Kentucky; and Oak Ridge, Tennessee
    include maintenance of facilities and grounds, cleaning legacy spills
    in the leased areas of the diffusion site consistent with the Federal
    Facilities Compliance Act, and guarding and protecting highly enriched
    uranium stored at the Portsmouth site.
        Since the Department shut down highly enriched uranium production
    at the Portsmouth Plant in 1992, we have been removing the highly
    enriched uranium residues and placing the facility in a safe shutdown
    condition. Progress on the removal of highly enriched uranium has been
    substantial, and all highly enriched uranium oxides not planned for
    transfer to USEC will be removed from the site by the end of fiscal
    year 1999.
        More than 70 facilities at the enrichment plants were not leased by
    USEC, Inc. and remain the responsibility of the Department. As
    landlord, my office maintains these facilities and their associated
    permits and is responsible for completing environmental corrective
    actions. We are also responsible for satisfying financial obligations
    associated with enrichment operations before the transition to USEC,
    Inc. Chief among these obligations is payment of post-retirement life
    and medical benefits to the Department's enrichment plant operating and
    power supply contractors and assisting in litigation involving claims
    against the Department for its prior operations. Lastly, after
    assisting in the transfer of regulatory oversight of the leased
    facilities and obtaining an initial certificate of compliance from the
    Nuclear Regulatory Commission, the Department continues to review and
    update safety documentation as necessary, for the non-leased facilities
    and assist the NRC in preparing annual congressional reports on the
    status of the diffusion plants.
        My office is also responsible for the management and disposition of
    the Department's surplus natural uranium inventories. The Department
    currently has an inventory of approximately 24 million pounds of
    natural uranium, with a total value of about $260 million, that may be
    sold in the commercial market. All of the uranium to be sold under this
    program is currently held at the Portsmouth or Paducah gaseous
    diffusion plants. The USEC Privatization Act and the Energy Policy Act
    allow the Department to sell excess uranium stockpiles subject to
    certain conditions. Before the Department sells any of its excess
    natural uranium, the USEC Privatization Act requires the Secretary to
    determine that `` * * * the sale of the material will not have an
    adverse material impact on the domestic mining, conversion, or
    enrichment industry, taking into account the sales of uranium under the
    U.S./Russian Highly Enriched Uranium (HEU) Agreement and the Russian
    Suspension Agreement * * * ''
        Finally, my office is also responsible for administering the $325
    million authorized in Public Law 105-277 for the purchase of natural
    uranium pursuant to 1997 and 1998 deliveries under the U.S./Russian HEU
    Agreement. The purchase of this material is contingent on the Russian
    and Western uranium suppliers reaching a long-term agreement on
    purchases of the natural uranium component of the low enriched uranium
    delivered under the U.S./Russian Highly Enriched Uranium Purchase
    contract. I understand these negotiations are going very well and an
    agreement may be reached soon.
                               program direction
        In fiscal year 2000, we are requesting $25 million for salaries,
    travel, support services, and other administrative expenses for 144
    Headquarters and Operations Office personnel providing technical
    direction to uranium, isotope support, and other nuclear energy
    programs. This budget item includes management and staff support funded
    by other Department of Energy accounts (e.g., technical direction for
    the operation of the Department's research reactors funded by the
    Office of Energy Research); other Federal agencies; and foreign
    governments. It also funds the activities of the Nuclear Energy
    Research Advisory Committee (NERAC).
        Mr. Chairman, this concludes my prepared statement. I will be happy
    to answer any questions. Again, I look forward to working with you and
    the Subcommittee this year as we examine important questions and issues
    concerning the allocation of federal resources to strengthen our
    universities and colleges, protect our critical infrastructures, bring
    vital isotopes and technology to the American people, support deep
    space and related missions, and meet our important stewardship
    responsibilities.
    [GRAPHIC] [TIFF OMITTED] T10AP13.008

    [GRAPHIC] [TIFF OMITTED] T10AP13.010

    Nuclear Energy: Essential in Reducing CO2 Emissions

                  [Utility pledges to reduce greenhouse gases]

    Improvements to nuclear plants....................................    33
    Renewable energy..................................................     4
    Methane recovery, foresty and fly ash reuse.......................     9
    Improvements to fossil plants.....................................    14
    Improved energy efficiency........................................    18
    Miscellaneous and uncategorized...................................    22

    [GRAPHIC] [TIFF OMITTED] T10AP13.009

                          Importance of nuclear power

        Senator Domenici. Thank you very much.
        I might just say here for the record, I do not see how we
    could have a Department of Energy, and have such little
    emphasis on nuclear power. It borders on being a sham, in my
    opinion, not your fault.
        Clearly, when the Administration puts such emphasis, a
    budget emphasis, on climate change technology initiative,
    departmental cross-cut, it is obvious to me that we have a
    department that wants to be for nuclear, but does not want to
    offend those who are against nuclear.
        Even so this document Climate Control Program which did not
    include any of the old programs, said zero for nuclear
    research, and then said this year it is going up 100 percent.
    Kind of interesting. Anybody looking at it who does not like
    nuclear power would love it.
        They would say, ``Look here, solar and renewable, as a
    climate change initiative has $398 million in the President's
    request, and that bad old nuclear stuff, it has $5 million. So
    we are still keeping it under check. The Department put little
    or no emphasis on nuclear power.'' When you put up charts that
    show in controlling the ozone problem, that one of the biggest
    and most significant contributors is nuclear power, and
    probably will be necessary in the future for us to meet our
    treaty obligations, if we ever do validate it in Kyoto.
        So I do not make any bones about it. I have done enough
    research now on nuclear power, traveled the country enough to
    say, and I am for it, and I believe we are going to miss the
    boat as new technologies arrive which are going to permit
    safer, modular, easy-to-build nuclear power plants. A very
    small group of people can contain the Department of Energy, can
    control it, and indicate that so long as we do all these other
    things they will support the Department, but if you do anything
    in nuclear, then that is the end of the game.
        I have also found, and I want this on the record, and I
    would like Dr. Krebs in particular to hear this, but also you
    Mr. Magwood, I have traveled now and delivered two major
    addresses on this subject, one at Harvard and one at MIT. The
    response from across this country has been overwhelmingly
    positive from those who know how we are falling behind in
    technology of this type. Now, you showed on one of your charts,
    that the rest of the world is not falling behind, and they are
    proceeding, using American ingenuity and American talent. You
    just showed us a super plant in Japan--how long did it take to
    build that plant?
        Mr. Magwood. Just about 4 years.
        Senator Domenici. Four years. Incidentally, for those who
    wonder, they have a high safety record, a marvelous safety
    record in Japan. So 4 years to build it and there is no
    indication that they are cutting corners, it is that they have
    accepted nuclear power as something that is necessary and have
    adjusted their regulatory program accordingly.
        I do not know what other things we are going to find in
    other hearings that might be necessary to move ahead in this
    area. But I assure you, we cannot continue with a policy that
    says let us not offend those who are against nuclear power,
    because they have some power base that is important.
        I think what is important is that we do the right thing,
    and I believe we are moving in that direction in our committee.
    I think whether it be this year or next year, but eventually
    within a very short number of years, the administration will
    come to the reality that you have to move ahead with nuclear
    power if you want to have a clean environment and meet some
    obligations with reference to our contribution to that
    pollution.
        Thanks for permitting me to follow-on on your remarks, and
    now we will go quickly to our testimony on the solar and
    renewable program. I have already complimented you, Mr.
    Reicher, and I want to do that again. I think you have found
    that we were pretty concerned about some of the things they use
    solar and renewable money for. It did not seem to some of us to
    be promoting the future, but rather promoting some
    organizations, and I would appreciate it very much if you would
    tell us about that, but also give us your vision and view, a
    realistic one I hope, with reference to these programs.

                            STATEMENT OF DAN REICHER

        Mr. Reicher. Thank you, Mr. Chairman, and first of all I
    want to thank you for the confidence you have expressed in the
    job we have been doing in the Office of Energy Efficiency and
    Renewable Energy. I am pleased to testify on the Energy and
    Water Development subcommittee portion of that budget. As you
    know, the other portion of the budget comes from the Interior
    subcommittee.

                            program accomplishments

        Mr. Chairman, 20 years ago renewable energy was generally
    produced at a very high cost and in a very inefficient manner,
    and advanced power delivery system components and high-
    temperature super conductivity did not even exist. Furthermore,
    the alternative transportation fuel sector was very immature.
    We have come a long, long way in the last two decades. In large
    measure, it is as a result of the support of the Congress and
    the work of many national laboratories.
        The cost of electric power from wind turbines in 1980
    ranged from thirty to forty cents a kilowatt hour, and it has
    dropped as a result of aggressive R&D, to between four and six
    cents a kilowatt hour.
        At this price, wind power systems are entering the
    marketplace, expanding from early California sites, to states
    ranging from Vermont to Alaska, and from Wisconsin to Texas. We
    are also working on the next generation of turbines, which
    would bring the cost of wind power to as low as two-and-a-half
    cents a kilowatt hour by 2002. We are close to 20,000 megawatts
    of wind worldwide, and Mr. Chairman, this chart shows why wind
    is now the fastest growing energy source worldwide. Worldwide
    we have installed the equivalent of scores of fossil fuel
    plants, with more than 2,000 megawatts installed in 1998 alone
    across the globe.
        I am pleased to announce today that the New Mexico Energy
    Office, through our broadbased solicitation has been selected
    for negotiation to evaluate four potential wind sites. We
    anticipate that the negotiations will be completed within the
    next few weeks.

                                  photovoltaic

        As another example, Mr. Chairman, the first commercially
    available photovoltaic panels in the early 1980s produced power
    at a cost of one dollar per kilowatt hour. By fiscal year 2000,
    these PV systems will be delivering electricity for as low as
    twelve to twenty cents per kilowatt hour, and in the next
    decade it should drop to below a dime, if we continue adequate
    support, particularly the work at the National Renewable Energy
    Laboratory and Sandia National Lab.
        We now have large PV manufacturing plants in states as
    diverse as Virginia, Maryland, California, Michigan, Delaware,
    and Massachusetts. The solar industry is a fast-growing part of
    the U.S. economy; however, while both domestic PV production
    and U.S. product sales are up, we risk losing our world market
    leadership, having dropped from 44 percent in 1996 to 40
    percent in 1997, to 35 percent in 1998. Our potential loss of
    this growing market is exacerbated by a Japanese PV budget,
    which is three times what we spend in the U.S.
        Senator Domenici. Mr. Reicher, I note that I have to make a
    phone call at 10:30. We will come right back to you in about
    two minutes.
        Mr. Reicher. Thank you, Mr. Chairman.
        [A brief recess was taken.]
        Senator Domenici. The hearing will come to order, please.
        Would you continue, Mr. Reicher?

                               biofuels programs

        Mr. Reicher. Production of ethanol is also on track for
    widespread domestic use at very competitive prices. As you
    know, Mr. Chairman, the use of ethanol is a very effective
    means to reduce our dependence on foreign oil. To compete with
    today's inexpensive gasoline, our biofuels program focuses on
    the development of facilities which make ethanol from
    agricultural and forest waste and from dedicated crops.
        Mr. Chairman, Senator Lugar and former CIA director, James
    Woolsey highlighted the phenomenal potential for waste to
    ethanol production in a recent article in foreign affairs. I
    request that it be entered into the record, and you will find
    it a very interesting discussion of how we can cheaply produce
    ethanol from waste materials.
        Senator Domenici. Very good.
        [The information follows:]

                               The New Petroleum

                    [Richard G. Lugar and R. James Woolsey]

                                  why change?
        Oil is a magnet for conflict. The problem is simple--everyone needs
    energy, but the sources of the world's transportation fuel are
    concentrated in relatively few countries. Well over two-thirds of the
    world's remaining oil reserves lie in the Middle East (including the
    Caspian basin), leaving the rest of the world dependent on the region's
    collection of predators and vulnerable autocrats. This unwelcome
    dependence keeps U.S. military forces tied to the Persian Gulf, forces
    foreign policy compromises, and sinks many developing nations into
    staggering debt as they struggle to pay for expensive dollar-
    denominated oil with lower-priced commodities and agricultural
    products. In addition, oil causes environmental conflict. The
    possibility that greenhouse gases will lead to catastrophic climate
    change is substantially increased by the 40 million barrels of oil
    burned every day by vehicles.
        Ethanol has always provided an alternative to gasoline. In terms of
    environmental impact and fuel efficiency, its advantages over gasoline
    substantially outweigh its few disadvantages. But until now it has only
    been practical to produce ethanol from a tiny portion of plant life--
    the edible parts of corn or other feed grains. Corn prices have
    fluctuated around $100 a ton in the last few years, ranging from half
    to double that amount. Ethanol has thus been too expensive to represent
    anything but a small, subsidized niche of the transportation fuel
    market. In spite of recent reductions in the expense of ethanol
    processing, the final product still costs roughly a dollar a gallon, or
    about double today's wholesale price of gasoline.
        Recent and prospective breakthroughs in genetic engineering and
    processing, however, are radically changing the viability of ethanol as
    a transportation fuel. New biocatalysts--genetically engineered
    enzymes, yeasts, and bacteria--are making it possible to use visually
    any plant or plant product (known as cellulosic biomass) to produce
    ethanol. This may decisively reduce cost--to the point where petroleum
    products would face vigorous competition.
        The best analogy to this potential cost reduction is the cracking
    of the petroleum molecule in the early twentieth century. This let an
    increasingly large share of petroleum be used in producing high-
    performance gasoline, thus reducing waste and lowering cost enough that
    gasoline could fuel this century's automotive revolution. Genetically
    engineered biocatalysts and new processing techniques can similarly
    make it possible to utilize most plant matter, rather than a tiny
    fraction thereof, as fuel. Cellulosic biomass is extremely plentiful.
    As it comes to be used to produce competitively priced ethanol, it will
    democratize the world's fuel market. If the hundreds of billions of
    dollars that now flow into a few corners in a few nations were to flow
    instead to the millions of people who till the world's fields, most
    countries would see substantial national security, economic, and
    environmental benefits.
                               paying for rogues
        Energy is vital to a country's security and material well-being. A
    state unable to provide its people with adequate energy supplies or
    desiring added leverage over other people often resorts to force.
    Consider Saddam Hussein's 1990 invasion of Kuwait, driven by his desire
    to control more of the world's oil reserves, and the international
    response to this threat. The underlying goal of the U.N. force, which
    included 500,000 American troops, was to ensure continued and
    unfettered access to petroleum.
        Oil permeates every aspect of our lives, so even minor price
    increases have devastating impacts. The most difficult challenge for
    planners, policymakers, and alternative-energy advocates is the
    transportation sector, which accounts for over 60 percent of U.S. oil
    demand. The massive infrastructure developed to support gasoline-
    powered cars is particularly resistant to modifications. It precludes
    rapid change to alternative transportation systems and makes America
    highly vulnerable to a break in oil supplies. During a war or embargo,
    moving quickly to mass transit or to fuel-cell or battery-powered
    automobiles would be impossible.
        For most countries, excluding only those few that will be the next
    century's oil suppliers, the future portends growing indebtedness,
    driven by increasingly expensive oil imports. New demand for oil will
    be filled largely by the Middle East, meaning a transfer of more than
    $1 trillion over the next 5 years to the unstable states of the Persian
    Gulf alone--on top of the $90 billion they received in 1996.
        Dependence on the Middle East entails the risk of a repeat of the
    international crises of 1973, 1979, and 1990--or worse. This growing
    reliance on Middle Eastern oil not only adds to that region's
    disproportionate leverage but provides the resources with which rogue
    nations support international terrorism and develop weapons of mass
    destruction and the ballistic missiles to carry them. Iraqi vx nerve
    gas and Iranian medium-range missiles show how such regimes can convert
    oil revenues into extensive and sophisticated armament programs.
                              is oil running out?
        Optimists about world oil reserves, such as the Department of
    Energy, are getting increasingly lonely. The International Energy
    Agency now says that world production outside the Middle Eastern
    Organization of Petroleum Exporting Countries (OPEC) will peak in 1999
    and world production overall will peak between 2010 and 2020. This
    projection is supported by influential recent articles in Science and
    Scientific American. Some knowledgeable academic and industry voices
    put the date that world production will peak even sooner within the
    next five or six years.
        The optimists who project large reserve quantities of over one
    trillion barrels tend to base their numbers on one of three things:
    inclusion of heavy oil and tar sands, the exploitation of which will
    entail huge economic and environmental costs; puffery by OPEC nations
    lobbying for higher production quotas within the cartel; or assumptions
    about new drilling technologies that may accelerate production but are
    unlikely to expand reserves.
        Once production peaks, even though exhaustion of world reserves
    will still be many years away, prices will begin to rise sharply. This
    trend will be exacerbated by increased demand in the developing world.
    As Daniel Yergin, Dennis Eklof, and Jefferson Edwards pointed out in
    these pages (``Fueling Asia's Recovery,'' March/April 1998), even
    assuming a substantial recession, increased Asian needs alone will add
    enough demand by 2010 (9 million barrels per day) to more than equal
    Saudi Arabia's current daily production.
        The nations of the Middle East will be ready to exploit the trend
    of rising demand and shrinking supply. The Gulf states control nearly
    two-thirds of the world's reserves; the states bordering the Caspian
    Sea have another several percent. Barring some unforeseen discoveries,
    the Middle East will control something approaching three-quarters of
    the world's oil in the coming century.
                               a whole new world
        If genetically engineered biocatalysts and advanced processing
    technologies can make a transition from fossil fuels to biofuels
    affordable, the world's security picture could be different in many
    ways. It would be impossible to form a cartel that would control the
    production, manufacturing, and marketing of ethanol fuel. U.S.
    diplomacy and policies in the Middle East could be guided more by a
    respect for democracy than by a need to protect oil supplies and
    accommodate oil-producing regimes. Our intrusive military presence in
    the region could be reduced, both ameliorating anti-American tensions
    and making U.S. involvement in a Middle Eastern war less likely. Other
    states would also reap benefits.. Ukraine, rich in fertile land, would
    be less likely to be dominated over time by oil-rich Russia. China
    would feel less pressure to befriend Iran and Iraq or build a big navy
    to secure the oil of the South China Sea. The ability of oil-exporting
    countries to shape events would be increasingly limited.
        The recent report by the President's Committee of Advisers on
    Science and Technology (PCAST) predicted that U.S. oil imports will
    approximately double between 1996 and 2030, from 8.5 million barrels
    per day, at a cost of $64 billion, to nearly 16 million barrels per
    day, at a cost of $120 billion. They estimated, however, that with
    concentrated efforts in fundamental energy research and investment in
    renewable fuel technologies, this could be reduced to 6 million barrels
    per day in 2030. The report concluded,

              A plausible argument can be made that the security of the
            United States is at least as likely to be imperiled in the
            first half of the next century by the consequences of
            inadequacies in the energy options available to the world as by
            inadequacies in the capabilities of U.S. weapons systems. It is
            striking that the Federal government spends about 20 times more
            R&D money on the latter problem than on the former.
                                  fuel farmers
        Cellulosic ethanol would radically improve the outlook for rural
    areas all over the world. Farmers could produce a cash crop by simply
    collecting agricultural wastes or harvesting grasses or crops natural
    to their region. Agricultural nations with little to no petroleum
    reserves would begin to see economic stability and prosperity as they
    steadily reduced massive payments for oil imports. Even more striking
    would be the redistribution of resources that would occur if farmers
    and foresters produced much of the world's transportation fuel. We know
    from the positive results of micro-credit institutions and other such
    programs that even small increases in income can be a major boost to a
    subsistence-level family's prospects. If family income is a few hundred
    dollars a year, earning an extra $50-$100 by gathering and selling
    agricultural residues to a cellulosic ethanol plant could mean a much
    improved life. Such added income can buy a few used sewing machines to
    start a business or a few animals to breed and sell. It can begin to
    replace despondency with hope.
        There are likely to be even larger effects on rural development if
    biomass ethanol production can lead a shift toward using plant matter
    for other products as well, such as biochemicals and electrical energy.
    The cleanliness of renewable fuel technologies makes them particularly
    attractive to countries that lack a sophisticated infrastructure or
    network of regulatory controls. At least some facilities that process
    carbohydrates should lend themselves to being simplified and sized to
    meet the needs of remote communities. If such towns can produce their
    own fuel, some of their fertilizers, and electricity, they will be far
    better positioned to make their way out of poverty and to move toward
    democracy and free enterprise. Local economic development can promote
    political stability and security where poverty now produces
    hopelessness and conflict.
        A major strength of the new technologies for fermenting cellulosic
    biomass is the prospect that almost any type of plant, tree, or
    agricultural waste can be used as a source of fuel. This high degree of
    flexibility allows for the use of local crops that will enrich the
    soil, prevent erosion, and improve local environmental conditions.
        Finally, as recession and devaluations overseas move the American
    balance-of-payments deficit from the 1998 level--$1 billion every two
    days--toward nearly $1 billion every day, there will be increased calls
    for protectionism. The best way to avoid the mistakes of the 1930s is
    to have a solid economic reason for increasing U.S. production of
    commodities now bought abroad. The nearly $70 billion spent annually
    for imported oil represents about 40 percent of the current U.S. trade
    deficit, and every $1 billion of oil imports that is replaced by
    domestically produced ethanol creates 10,000-20,000 American jobs.
                                easy being green
        To be politically and economically acceptable, changes in fuel must
    be understood by the American public to be affordable and not
    disruptive. Most other countries require the same tough criteria--U.S.
    difficulties in convincing developing nations to reduce greenhouse gas
    emissions are directly related to the cost and the damage this would
    have on their development plans. But if one of the most effective ways
    to reduce greenhouse emissions also produced an unproved balance-of-
    payments deficit and opportunities for rural development, economic
    benefits would suddenly far exceed the costs. The political
    acceptability of reducing emissions changes substantially when the
    economics change. A shift to biomass fuels stands out as an excellent
    way to introduce an environmentally friendly energy technology that has
    a chance of both enjoying widespread political and economic support and
    having a decisive impact on the risk of climate change.
        Renewable fuels produced from plants are an outstanding way to
    substantially reduce greenhouse gases. Although burning ethanol
    releases carbon dioxide into the atmosphere, it is essentially the same
    carbon dioxide that was fixed by photosynthesis when the plants grew.
    Burning fossil fuels, on the other hand, releases carbon dioxide that
    otherwise would have stayed trapped beneath the earth.
        If one looks at the complete life cycle of the production and use
    of ethanol derived from feed grains, the only addition of carbon
    dioxide to the atmosphere results from the use of fossil fuel products
    in planting, chemical fertilizing, harvesting, and processing. But this
    fossil fuel use can be substantial--up to seven gallons of oil may be
    needed to produce eight gallons of ethanol. When ethanol is produced
    from cellulosic biomass, however, relatively little tilling or
    cultivation is required, reducing the energy inputs. It takes only
    about one gallon of oil to produce seven of ethanol. There is a virtual
    consensus among scientists: when considered as part of a complete cycle
    of growth, fermentation, and combustion, the use of cellulosic ethanol
    as a fuel, once optimized, will contribute essentially no net carbon
    dioxide to the atmosphere.
        According to a 1997 study done by five laboratories of the U.S.
    Department of Energy, a vehicle powered by biomass ethanol emits well
    under one percent of the carbon dioxide emitted by one powered by
    gasoline. More surprising, however, is that ethanol produced from
    biomass emits only about one percent of the carbon dioxide emitted by
    battery-powered vehicles, since the electricity for those is commonly
    produced by burning fossil fuels at another location. Although local
    air quality is improved, total carbon dioxide emissions are not
    curtailed; they are merely exported--for example, from Los Angeles to
    the Four Corners. Unless the electricity to charge the car's batteries
    is produced by renewable fuels or nuclear power, electric vehicles are
    only 20 to 40 percent better as carbon dioxide emitters than gasoline-
    powered cars. Biomass ethanol beats both by a factor of about 100,
    fundamentally changing the global-warming debate.
                                fringe benefits
        Cellulosic ethanol is the only alternative fuel that requires, at
    most, very modest changes to vehicles and the transportation
    infrastructure. One need not spend money retooling Detroit, nor spend
    years awaiting the gradual replacement of older vehicles by those with
    new technology. Nor does one need to modify or construct pipelines and
    storage tanks to hold hydrogen as an alternate to petroleum. This
    compatibility with today's infrastructure saves billions of dollars and
    not just years, but decades. Moreover, there is nothing incompatible
    between using ethanol now in internal combustion engines and using it
    later in more efficient power systems, such as hybrids or fuel cells.
        Essentially all automobiles currently on the road can use fuel
    containing up to ten percent ethanol. But strict fuel economy standards
    have encouraged the development and production of flexible fuel
    vehicles (FFVs) that can use up to 85 percent ethanol. FFVs are already
    in dealers' showrooms, containing (at no added cost to the consumer)
    the minor engine modifications--a computer chip in the fuel system and
    a fuel line made out of slightly different material--that make large-
    scale ethanol use possible. Even pure ethanol vehicles are quite
    practical. Brazil has 3.6 million on the road.
        Corn ethanol will continue to serve an important role as ethanol
    production shifts to cellulosic biomass. Commercialization of corn
    ethanol has provided a base of industrial experience, talented people,
    and infrastructure from which a much larger cellulosic ethanol industry
    may be launched. For corn farmers, biomass is no threat; it will
    probably be a boon. Indeed, there is likely to be a continuing, perhaps
    even an expanding, market for corn ethanol because of the value of its
    byproducts, such as animal feed. In general, the transition from corn
    to cellulosic biomass and from a few producers to many is likely to
    expand opportunities for American farmers.
                               bioengineered bugs
        Ethanol's economic viability depends on making it cheaper to
    produce. This can be achieved by making it out of cellulosic biomass,
    which includes essentially anything that grows or has grown:
    agricultural and forest residues, prairie grass, kudzu, waste wood,
    used paper products, even much of urban waste. Last year, about 95
    percent of the ethanol produced in the United States came from corn.
    But agricultural residues and other wastes have low or even negative
    cost--some you are paid to haul away--while crops like prairie grass
    cost only a few tens of dollars a ton. This represents a substantial
    savings in the raw material used in ethanol and puts it within the
    range of oil, even inexpensive Persian Gulf oil.
        Only recently have scientists developed the means to convert
    cellulosic biomass efficiently into ethanol. The edible portions of
    corn and other grains easily ferment into ethanol because of their
    chemical make-up. Most biomass, however, consists of more recalcitrant
    hemicellulose and cellulose, requiring both the breaking up of these
    two fibers as well as the fermenting of both five- and six-carbon
    sugars. This all happens in nature, but two parts of it--fermenting
    five-carbon sugars and breaking up cellulose quickly--are technically
    challenging. The first is now done by genetically engineered
    microorganisms; this tool and other new techniques are now being
    brought to bear on the second problem.
        How far along are these developments? The current efficiency of
    ethanol processing is somewhat analogous to that of petroleum refining
    in the early 1900s: after the invention of thermal cracking made it
    possible to use a major share of the petroleum molecule for gasoline
    production but before the invention of catalytic cracking opened up an
    even larger share of petroleum to exploitation. In short, we have come
    a long way, but still have some inventing to do. The new, genetically
    engineered microorganisms have already taken us far toward the
    fermentation of ethanol from a wide range of plant material, laying the
    groundwork for reductions in processing costs as well.
        The new microorganisms, combined with other improvements in
    processing, fundamentally change the equation for considering ethanol a
    major transportation fuel. According to a recent study by Dartmouth
    engineering professor Lee Lynd, utilizing only some of the nation's
    agricultural and forest residues, with no additional land use, could
    supply over 15 billion gallons of ethanol a year--more than ten times
    the amount now produced from corn, and enough to replace around eight
    percent of the nation's gasoline. (Not all residues would be used, of
    course, since some must be left for long-term fertility.) Lynd also
    calculated that taking a little over half of the 60 million acres of
    cropland historically idled by federal programs for conservation and
    other purposes, and using for ethanol production the mown grasses with
    which much of this acreage is ordinarily planted, would produce enough
    ethanol to fulfill around 25 percent of the country's annual gasoline
    needs. These calculations use current automobile mileage. Lynd notes
    that, further mileage improvements, achieved through a shift to hybrids
    or fuel cells, could obviate the need for gasoline entirely, without
    taking land from food crops or nonagricultural uses. The coproduction
    of animal feed and biomass residues from alfalfa and switchgrass is
    especially promising. There is, in short, no basis for the argument
    that America does not have the land to produce enough ethanol to make a
    very large dent in U.S. gasoline consumption.
        Biofuels must be produced in ways that enhance overall
    environmental quality. Sound land-use policies certainly must be
    followed, to protect wildlife habitat and address other environmental
    concerns. But professional land-use techniques should readily
    accomplish this. Alternative fuels are often seen as an unpalatable
    necessity representing a retrenched standard of living, forced upon us
    in an age of limits. The opposite may be true. Utilization of renewable
    fuels will make it possible for us to continue enjoying the freedom
    afforded by private cars, even as the production of petroleum begins to
    decline.
                                the right stuff?
        Early this century, Henry Ford expected that ethanol, not gasoline,
    would be the fuel of choice for automobiles. His reasons are evident.
    The two fuels can be compared by examining three basic parameters--
    energy content, octane, and vapor pressure. Pure ethanol contains 69
    percent of the energy of gasoline. A lower energy content translates
    into fewer miles to the gallon; in order to travel the same range,
    about a 30 percent larger fuel tank is needed (as is used in Brazil).
    Many scientists believe that optimizing engines for ethanol use will
    largely compensate for this difference, in part because ethanol is a
    simple combination of carbon, hydrogen, and oxygen. It is vastly less
    complex than gasoline, which means that fine-tuning an engine to
    squeeze every last drop of energy from ethanol is potentially easier.
        Octane is the measure of a fuel's ability to oxidize hydrogen and
    carbon molecules within a fraction of a second. When the reaction is
    not simultaneous, ``engine knock'' and inefficient combustion result.
    Ethanol has an octane rating 15 percent higher than gasoline's. In the
    1920s ethanol was briefly considered as a large-scale additive to
    gasoline to stop the knocking of the new higher compression engines.
    However, to the detriment of public health, ethanol lost out to highly
    toxic tetraethyl lead, for three reasons: in contrast to ethanol, only
    a small amount of lead was needed as an additive; some were concerned
    that corn-derived ethanol would compete for land and threaten the feed
    grains market; and since Prohibition was in effect, many were also
    worried about the security problems associated with maintaining large
    volumes of what is essentially 200-proof vodka. Ethanol's ability to be
    an effective fuel, however, was never an issue.
        A third important fuel measurement is vapor pressure, or how
    readily a liquid evaporates. A fuel's vapor pressure is directly linked
    to the quantity of vehicle emissions, since over 40 percent of
    automobile emissions result from evaporation, not tailpipe emissions.
    Substituting ethanol for gasoline in any amount reduces tailpipe
    emissions and thus reduces urban smog. Pure ethanol, and any gasoline-
    ethanol mixture that is more than 22 percent ethanol, has a lower vapor
    pressure than gasoline and would therefore reduce the amount of
    evaporative emissions.
        Somewhat confusingly, however, blends of ethanol and current
    gasoline have a slightly higher vapor pressure than pure gasoline when
    the mixture contains less than 22 percent ethanol, because of the
    unique mixing properties of the liquids. Some studies show that low-
    level blends of ethanol and gasoline (like gasohol, which is ten
    percent ethanol) can actually worsen local air pollution, especially
    the formation of low-level ozone. Consequently, in cities in the
    Northeast and California, proposals to encourage the use of ethanol
    blends have often fallen on deaf ears. Some environmentalists see them
    as camouflaged subsidies for Midwestern corn growers at the expense of
    the cities.
        But although low-level ethanol blends present complex issues,
    blends with more than 22 percent ethanol--which can be used in FFVs--do
    not have the vaporization problem. Moreover, with different approaches
    to refining and blending gasoline, a solution to the vaporization
    problem may well exist even at mixtures below 22 percent. Finally,
    ETBE--an oxygenate made from ethanol that improves gasoline
    combustion--improves air quality both in tailpipe emissions and
    vaporization, although its use means the fuel contains five to ten
    percent ethanol.
        Choosing to use cellulosic ethanol is not a choice to forsake more
    advanced automobile propulsion technologies, such as hybrids and fuel
    cells. Ethanol is compatible with both. Jeffrey Bentley, vice president
    of Arthur D. Little, Inc., a company recently honored by the U.S.
    government for its novel fuel-cell technology, stated that ``ethanol
    provides higher efficiencies, fewer emissions, and better performance
    than other fuel sources, including gasoline * * *. Where ethanol is
    available, it will be the fuel of choice by consumers.'' As both
    hybrids and fuel cells continue to improve, automobiles powered by them
    may dramatically reduce air pollution. Ethanol's compatibility with
    both makes moving toward cellulosic ethanol as a transportation fuel
    much more desirable.
        If government policies promote FFVs, moreover, a large fleet of
    ethanol-compatible vehicles will be available much earlier than would
    otherwise have been feasible. This is because FFVs can burn gasoline
    now but can use cellulosic ethanol as it becomes available. Introducing
    FFVs into the national fleet differs radically in timing from other
    changes in transportation. Even if an ideal hybrid or fuel-cell vehicle
    came on the market, the slow rate of turnover in the nation's cars
    would mean that it would be many years before its introduction would
    make a dent in overall fuel use. But moving now to substantially
    increase the number of FFVs being produced would create the capability
    to shift to cellulosic ethanol as soon as it is available at attractive
    prices.
        In addition, insofar as U.S. security and environmental concerns
    are more with the consumption of problem-causing petroleum fuel than
    with fuel in general, substituting cellulosic ethanol for gasoline
    improves relevant ``mileage'' radically, even in internal combustion
    engines. For example, an average automobile gets approximately 17 miles
    per gallon and is driven approximately 14,000 miles per year, thus
    using 825 gallons of gasoline annually. Suppose that same automobile
    were an FFV using a mixed fuel containing 85 percent cellulosic
    ethanol. Because of ethanol's lower energy content, it would use about
    1,105 gallons of fuel, but only 165 would be gasoline. Such a vehicle
    could be said to be getting, in a sense, over 80 miles per gallon--of
    national-security-risk-increasing, carbon-dioxide-producing gasoline.
        The one remaining barrier to widespread replacement of gasoline
    with ethanol is production cost. Relying on feed grains makes this cost
    comparatively high and volatile, since corn is subject to the caroming
    behavior of feed markets. In 1995, its price of $100 a ton nearly
    doubled, forcing a sharp curtailment in ethanol production. A partial
    shift to biomass should circumvent such instabilities. Over the past 15
    years, the cost of producing a gallon of ethanol has been cut in half,
    to just over $1 a gallon wholesale. If, as predicted, the new
    biocatalysts, low and steady raw material costs, and improved
    processing let costs fall another 50 percent or so, ethanol could
    compete with gasoline at today's prices. If oil prices rise in the next
    century, gasoline could actually be at a substantial price
    disadvantage.
        Such a reduction of ethanol cost is entirely plausible for two
    reasons. First, a simple comparison of energy content reveals that a
    dry ton of biomass crops--$40 is a reasonable current average cost--is
    comparable to oil at $10-13 a barrel. Agricultural wastes, in many
    cases, are considerably cheaper than either: many are free or have
    negative cost. So the overall costs of cellulosic biomass are likely to
    at least be in the same ballpark as those of crude oil. Second, further
    reductions in the cost of processing seem quite achievable. The current
    cost of processing ethanol is significantly higher than the equivalent
    price per barrel for oil. But this discrepancy reflects the maturity
    and sophistication of the petroleum industry, developed over the past
    century, as compared to the fledgling biofuels effort. Producing
    ethanol is not inherently more complex than refining petroleum--in
    fact, just the contrary. The world has simply invested far more effort
    in the latter.
                                   jump-start
        While the private sector will provide the capital, and motivation
    to move toward ethanol, the federal government has a vital role to
    play. Market forces seldom reflect national security risks,
    environmental issues, or other social concerns. The private sector
    often cannot fund long-term research, despite its demonstrated
    potential for dramatic innovation. Hence, the federal government must
    increase its investment in renewable energy research, particularly in
    innovative programs such as genetic engineering of biocatalysts,
    development of dedicated energy crops, and improved processing. The
    very small sums previously invested by the Departments of Energy and
    Agriculture have already spawned dramatic advances. Every effort should
    be made to expand competitive, merit-based, and peers reviewed science
    and to encourage research that cuts across scientific disciplines.
        Research is essential to produce the innovations and technical
    improvements that will lower the production costs of ethanol and other
    renewable fuels and let them compete directly with gasoline. At
    present, the United States is not funding a vigorous program in
    renewable technologies. The Department of Energy spends under two
    percent of its budget on renewable fuels; its overall work on renewable
    technologies is at its lowest level in 30 years. Because private
    investment often follows federal commitment, industrial research and
    development has also reached new lows. These disturbing trends occur at
    a time of national economic prosperity when America has both time and
    resources for investing in biofuels. The United States cannot afford to
    wait for the next energy crisis to marshal its intellectual and
    industrial resources.
        Research alone will not suffice to realize cellulosic ethanol's
    promise. The federal government should also modify the tax code to spur
    private investment. The existing renewable alcohol tax credits have
    recently been extended by Congress through 2007--which will help the
    growth of the new biofuels industry and offer some protection in the
    transition from grain to cellulosic biomass. But the tax credit
    structure should facilitate the gradual adoption of cellulosic
    ethanol--in time, it should not need subsidies. Government incentives
    to produce FFVs should also be increased.
        Finally, there must be a coordinated effort across the many
    different federal agencies that oversee government laboratories and
    regulatory agencies. The analogy to the semiconductor industry is
    instructive. In 1987, Congress authorized the creation of a government-
    industry partnership, the Semiconductor Manufacturing Technology
    Association (SEMATECH). Under the direction of the Department of
    Defense's Advanced Research Projects Agency, SEMATECH pursued
    fundamental research in semiconductor components and manufacturing
    processes. Private firms with innovative ideas were encouraged to
    devote research dollars to transform the idea into a commercial
    reality. The few domestic semiconductor manufacturers were brought
    together in forums where the companies could discuss technical hurdles
    without sacrificing competitive advantage. Today, the success of
    SEMATECH is evident, as the high-technology sector demonstrates.
    Biofuels offer a similar opportunity.
        Cellulosic ethanol is a first-class transportation fuel, able to
    power the cars of today as well as tomorrow, use the vast
    infrastructure already built for gasoline, and enter quickly and easily
    into the transportation system. It can be shipped in standard rail cars
    and tank trucks and is easily mixed with gasoline. Although somewhat
    lower in energy content, it has a substantially higher octane rating
    than gasoline, allowing for more efficient combustion. It can radically
    reduce the emission of global warming gases, help reduce the choking
    smog of our cities, and improve air quality. It is far less toxic than
    petroleum, far less likely to explode and burn accidentally, and far
    simpler physically and chemically, making possible simpler refining
    procedures. If a second Exxon Valdez filled with ethanol ran aground
    off Alaska, it would produce a lot of evaporation and some drunk seals.
        Our growing dependence on increasingly scarce Middle Eastern oil is
    a fool's game--there is no way for the rest of the world to win. Our
    losses may come suddenly through war, steadily through price increases,
    agonizingly through developing-nation poverty, relentlessly through
    climate change--or through all of the above. It would be extremely
    short-sighted not to take advantage of the scientific breakthroughs
    that have occurred and that are in the offing, accelerate them, and
    move smartly toward ameliorating all of these risks by beginning to
    substitute carbohydrates for hydrocarbons. If we do, we will make life
    far less dangerous and far more prosperous for future generations. If
    we do not, those generations will look back in angry wonder at the
    remarkable opportunity that we missed.

        Mr. Reicher. As an example, construction recently began in
    Louisiana of a first-of-a-kind production plant, with 80
    percent cost share, that will produce ethanol from sugarcane
    waste. We are also supporting the development of plants in
    California and New York that will use rice draw and even
    municipal solid waste to produce ethanol, again, which can be
    used in automobiles, to reduce our dependence on foreign oil.

                               superconductivity

        A final example of our technological progress involves
    superconductivity. Through our innovative industry-laboratory
    R&D program, superconductivity has rapidly moved from discovery
    to utility-scale prototypes that carry 100 times the current of
    conventional copper cables, and this has occurred in only 10
    years. I am pleased to note that the world's first super-
    conducting power line will be installed in Detroit next year.
        While we are making tremendous strides in these
    technologies, we still have much work to do. The competitive
    revolution and power generation has led to drastic decreases in
    the price of electricity. Still, renewable energy is already
    making market in-roads in many states.
        The world's largest wind installation is being developed in
    Iowa. Major new commitments to solar energy in many states,
    ranging from Massachusetts, to Nevada, to New Mexico, biomass
    power plants in states such as New York, Ohio, Minnesota,
    Vermont, and Indiana, and tens of thousands of new geothermal
    heat pumps in homes, businesses, federal installations, and
    schools in states as diverse as Wisconsin, Kentucky, North
    Dakota, and South Carolina.
        We are also aggressively pursuing integration of fossil
    fuel with renewable energy technologies. Projects that combine
    wind with natural gas and co-firing of biomass with coal
    demonstrate the opportunities that exist between renewables and
    fossil fuels.
        Mr. Chairman, I look forward to the opportunity to provide
    a more in-depth discussion of our successes at the upcoming
    subcommittee hearing on the deployment of renewable
    technologies.

                        fiscal year 2000 budget request

        Our fiscal year 2000 budget request would accelerate the
    development and market penetration of renewables and advanced
    power systems. Our request is $325 million, up $53 million, or
    19 percent, from this year's enacted level. I would note that
    this year's request is a small fraction of what Congress
    appropriated for renewables in the early 1980s.
        Let me quickly give you some examples of major program
    activities in fiscal year 2000. The photovoltaic program will
    initiate the development of new high-efficiency, multi-junction
    solar cells to capture and convert one-third of the sun's
    energy to electricity.
        That would be up from 8 to 15 percent conversion today. The
    biopower program will accelerate development of advanced
    conversion systems, such as co-firing biomass with coal. The
    biofuels program will continue its waste ethanol projects and
    advance its core conversion technology research with
    universities and national labs.
        I would also note that biofuels have the potential to
    mitigate major environmental problems in the West. Due to
    suppression of forest fires, large quantities of dead and
    diseased trees and underbrush have accumulated in the forest,
    creating a severe fuel loading problem, which threatens human
    life and property, as well as wildlife and timber resources.
    Working with states, labs, and industrial partners, we are
    evaluating forest thinnings for conversion to ethanol and co-
    generation of electricity.
        The wind program will place added emphasis on fuel testing
    small wind turbine prototypes to verify performance for remote
    sites, cold weather, and off-grade energy needs. We will also
    begin testing the next generation of large turbines for major
    on-grid power production as a major step towards producing
    power at two to three cents a kilowatt hour.
        The geothermal program will focus more resources on high-
    priority research and technology development for electric power
    applications. The program will accelerate work to produce an
    advanced drilling system capable of economically accessing the
    vast geothermal resources below 10,000 feet. These initiatives
    will enable the program to achieve its goal of producing power
    at three cents a kilowatt hour.
        I also want to stress, Mr. Chairman, that in fiscal year
    2000 we proposed to more than double our hydropower budget to
    help us maintain and enhance our nation's existing
    hydroelectric generation, which today provides 10 percent of
    U.S. electricity.
        With more than 200 hydro facilities up for relicensing in
    the next decade, early indicators suggest than environmental
    concerns may cause regulators to reduce generation capacities
    or relicense facilities unless fish mortality and water quality
    concerns are met. We are developing and completing testing of
    advanced environmentally friendly hydropower turbine prototypes
    that will improve water quality and reduce fish kills.
        In fiscal year 2000, our hydrogen request will continue a
    strong core R&D effort to meet the goals in producing the cost
    of hydrogen production, increasing the energy density and
    efficiency of our storage systems, and developing low-cost
    reliable sensors to detect hydrogen leaks. Hydrogen, Mr.
    Chairman, has a phenomenal potential for clean power production
    and vehicle propulsion.

                  sole source vs. competitively awarded grants

        Mr. Chairman, when I became Assistant Secretary about 17
    months ago, I realized that the office faced many management
    challenges, and I made a major commitment to you to fix them.
    We have listened to you, to industry, to our other
    stakeholders, and we have delivered. This committee said we
    were relying too heavily on non-competitive mechanisms to
    disburse funds. We listened and we delivered a dramatic
    reduction in our use of non-competitive funding mechanisms.
        The Office of Power Technologies, which represents the bulk
    of the funding from this subcommittee, has increased its level
    of competition to 93 percent, including congressionally
    directed activities.
        Close to 100 activities previously funded by sole source
    contracts within the Energy and Water Development account in
    fiscal year 1998 will now be competitively awarded. In 1998, we
    competed the $1 billion management and operating contract for
    the National Renewable Energy Lab, the first time it was
    competed in 15 years.
        Across all of our offices we have reduced uncosted balances
    by more than 58 percent since the beginning of fiscal year
    1996. I am very proud of this progress.
        We realize, however, that our work to improve the way we do
    our business is by no means complete, and so we have
    established a new office management improvement team, and we
    are working with the National Academy of Public Administration
    to improve our procurement. The National Academy of Sciences is
    also conducting a broad review of our R&D programs.
        We are also trying to break down the stovepipes that have
    often separated our various offices. Our bioenergy initiative,
    for example, is helping us to better integrate our important
    work in bio-power, biofuels, and bioproducts.

                               prepared statement

        So in conclusion, Mr. Chairman, we have accomplished a
    great deal over the last two decades. We have set aggressive,
    but achievable goals. We have improved our management, and we
    have requested a realistic budget. We hope that in light of our
    success and our commitment we can earn this subcommittee's
    support.
        I am happy to respond to questions. Thank you.
        Senator Domenici. Thank you very much for an excellent
    statement.
        [The statement follows:]

                      Prepared Statement of Dan W. Reicher

        Mr. Chairman and members of the Subcommittee, I am pleased to have
    the opportunity to appear before you today to discuss the Energy and
    Water Development portion of the fiscal year 2000 budget request for
    the Department of Energy's Office of Energy Efficiency and Renewable
    Energy (EERE). I will address three areas related to Solar and
    Renewable Resource Technologies: (1) the tremendous technological
    progress that has been achieved to date; (2) what we will accomplish
    with the resources proposed in the fiscal year 2000 budget; and 3)
    important management improvements we have instituted within EERE.
    Technology Progress
        Twenty years ago renewable energy was generally produced at a very
    high cost and in an inefficient manner. Advanced power delivery system
    components and high temperature superconducting materials did not even
    exist, and the alternative transportation fuel sector was very
    immature. We have come a long way.
        For example, the cost of electric power from wind turbines in 1980
    ranged from $0.30-$0.40 per kilowatt-hour (kWh). Through aggressive R&D
    by EERE and its industry partners on wind turbine aerodynamics,
    materials development and computer-aided design, we have been able to
    reduce the costs to between $0.04 and $0.06 per kWh. At this price,
    wind systems are entering the marketplace, expanding from the early
    California windfarms to include States ranging from Vermont to Alaska
    and from Minnesota to Texas. Wind energy systems are also poised to
    expand into other Great Plains and Northeastern locations, such as
    Oklahoma, Wisconsin the Dakotas, Maine, and New York. We are also
    working on Next Generation Turbines to reduce the cost of electricity
    from wind even further--to as low as 2 \1/2\ cents per kWh by 2002.
    This cost will enable wind to compete in many regions of the U.S.
        As another example, the first commercially-available photovoltaic
    (PV) systems in the early 1980s produced power at a cost of more than
    $1.00 per kWh. By fiscal year 2000, PV systems will be delivering
    electricity for as low as $0.12-$0.20 per kWh--depending upon the
    specific technology--making clean, reliable PV systems competitive in
    many remote and on- grid sites here in the U.S. and around the globe.
    By 2010 we project PV-generated electricity will drop to $0.10 per kWh.
    At this price solar would be a competitive power option in many urban
    and suburban areas where transmission and distribution systems are
    constrained and also in rural areas across the entire United States
    where distribution costs are too high. Improved materials manufacturing
    techniques and energy conversion improvements--most supported by DOE
    and its laboratories--have made and will make these cost reductions
    possible and have facilitated the resurgence of the U.S. PV industry as
    the world's leader in this $1.2 billion global industry, which grew 95
    percent between 1995 and 1998. With large manufacturing plants in
    Virginia, Maryland, California, Michigan, Delaware and Massachusetts,
    the solar industry is a growing part of the U.S. economy. However,
    global competition is fierce. While both domestic PV production
    capacity and U.S. product sales are up, the U. S. risks losing its
    world market leadership, having dropped from 44 percent in 1996 to 40
    percent in 1997 to 35 percent in 1998. Our potential loss of this
    growing market is exacerbated by a Japanese PV budget that is three
    times what we spend in the U.S. ($240 million in Japan in fiscal year
    1999 vs. $72 million in the U.S. in 1999).
        Production of ethanol is also on track for widespread vehicle use
    at competitive prices. To compete with today's inexpensive gasoline,
    our biofuels program focuses on the development of facilities that make
    ethanol from agricultural and forest wastes and dedicated crops.
    Construction recently began in Jennings, Louisiana, on a ``first-of-a-
    kind'' production plant with 80 percent industry cost-sharing that will
    produce ethanol from sugarcane waste. This 20-million gallon facility
    is scheduled to come on-line in the year 2000 with initial ethanol
    production costs of $1.00 per gallon, putting us well on-track for the
    program's 2010 production cost goal of $0.72 per gallon. We are also
    supporting the development of demonstration plants in California and
    New York that will use rice straw and municipal solid waste to produce
    ethanol. Additionally, we are studying ways to add facilities to
    existing corn-ethanol plants to produce ethanol from corn stalks and
    leaves. R&D on ethanol technology is very important to our future
    energy security. By 2020 net U.S. oil imports, which accounted for
    about 50 percent of domestic petroleum consumption in 1998, will grow
    to 65-70 percent of domestic petroleum consumption--with an annual oil
    bill ranging from $130 billion to more than $180 billion in current
    dollars.
        A final example of technological progress involves
    Superconductivity, a property of certain special materials allowing
    them to carry large electrical currents without resistance energy
    losses. While we have known about superconductivity for nearly a
    century, hurdles such as ultra-low temperature requirements stymied the
    development of commercial applications. Then Nobel prize-winning
    discoveries in the late 1980s opened the possibility for practical uses
    of these technologies to improve the efficiency and performance of the
    electricity sector. Through EERE's innovative industry/laboratory R&D
    program, High-Temperature Superconductivity (HTS) has rapidly moved
    from discovery to utility-scale prototypes that carry 100 times the
    current of conventional cable in only ten years. I am pleased to note
    that the world's first superconducting power line will be installed in
    Detroit in the fall of 2000. Installed more widely, superconducting
    power lines and equipment would increase capacity, efficiency and
    reliability during the crucial period ahead when competition will bring
    new (and unplanned) stresses on our national electrical system.
        While we are making tremendous strides in these technologies, we
    still have much work to do. The competitive revolution in the power
    generation sector has led to drastic decreases in the price of power
    from new sources of generation. For example, natural gas-fired
    combustion turbine technology produces electricity for about $0.03 per
    kWh. Given the low domestic market prices of fossil fuels, market
    penetration of renewable energy technologies is occurring more quickly
    in remote locations domestically and also overseas where the cost of
    electricity is generally much higher than in the U.S. Still, renewable
    energy is already making market inroads in many states: the world's
    largest wind installation in Iowa; major new commitments to solar
    energy in at least 15 states ranging from Massachusetts to Illinois to
    Arizona; biomass power plants in states such as New York, Ohio,
    Minnesota, Vermont and Indiana; and tens of thousands of new geothermal
    heat pumps in homes, businesses, schools and Federal installations in
    states as diverse as Indiana, New Jersey, Kentucky, Nevada and Utah.
        We are also aggressively pursuing integration of fossil fuel with
    renewable energy technologies. Projects such as hybrid wind/natural gas
    and co-firing of biomass with coal demonstrate the opportunities
    between renewables and fossil fuels.
        With this remarkable progress over the past two decades, we have
    established a firm foundation for major market success of renewables
    and advanced power delivery systems in the coming years.
    Fiscal Year 2000 Program Focus
        Our fiscal year 2000 budget request of $398.9 million--an 18.7
    percent increase over fiscal year 1999--would help us accelerate the
    market success of renewables and advanced power delivery systems. The
    budget request has three central objectives. First, we will accelerate
    U.S. technological progress by funding, in cooperation with industry
    and other partners, a balanced and integrated portfolio of research and
    development on renewable energy and power delivery technologies capable
    of meeting the diverse needs of the competitive electricity marketplace
    in the 21st Century. Second, we will improve environmental quality
    through increased use of non-polluting renewable energy technologies
    and advanced electric power systems. Third, we will expedite the
    transfer of technology and manufacturing process improvements to U.S.
    industries which will enable them to increase the deployment of their
    energy systems in the United States and to better compete for expanding
    export markets in other countries. The programs will help us achieve
    two important goals for 2010: (1) Tripling the installed U.S.
    electricity generation capacity of geothermal, biomass, wind, and
    solar; and (2) developing ethanol from wastes and dedicated crops as a
    cost competitive (less than $0.75 per gallon) domestically-produced
    blended transportation fuel.
        Some examples of major program activities in fiscal year 2000 that
    will help us achieve these objectives include:
        Photovoltaics.--The photovoltaic program will initiate development
    of new high-efficiency, multi-junction solar cells to capture and
    convert \1/3\ of the sun's energy to electricity (the concentrator cell
    will be 33 and \1/3\ percent efficient). The program will also continue
    efforts to reduce manufacturing costs and increase durability of PV
    systems, extending their lifetimes to greater than 25 years by 2004.
        Biopower/Biofuels.--In fiscal year 2000, the biopower program will
    accelerate development of advanced conversion systems such as co-firing
    with coal that offer economic, near-term reductions in carbon
    emissions. In addition, the program will also continue its three highly
    cost-shared, biomass power projects in Minnesota, Iowa, and New York
    that will confirm the economic feasibility of integrated biomass power
    projects and provide a vital stimulus to rural America.
        The fiscal year 2000 biofuels program will continue its waste-to-
    ethanol and corn ethanol projects, and advance its core conversion
    technology research with universities and the national laboratories
    through a highly competitive process. It will also co-fund the regional
    biomass and feedstock development programs essential for
    geographically-appropriate, genetically superior biomass material.
        Wind.--In fiscal year 2000, the Wind program will place added
    emphasis on field testing small wind turbine prototypes to verify
    performance for remote site, cold weather, and off-grid energy needs.
    The first Next Generation Turbine prototypes--large turbines for major
    on-grid power production--will also begin testing, a major step towards
    achieving the market- driven 2002 goal of 2\1/2\ cents per kWh in good
    winds.
        Geothermal.--The Geothermal program will focus more resources on
    high-priority research and technology development for electric power
    applications. In particular, the program will initiate a cost-shared
    enhanced geothermal system (EGS) at an existing geothermal field,
    putting the U.S. at the forefront of global competition to achieve the
    first full-scale EGS capable of sustained operation. Additionally, the
    program will accelerate work to produce an advanced drilling system
    capable of economically accessing the vast geothermal resources below
    10,000 feet. These initiatives will enable the program to achieve its
    long-term strategic goals, including the technology-based cost target
    of $0.03 per kWh.
        Hydropower.--In fiscal year 2000, we are more than doubling our
    hydropower budget request to help us maintain and enhance our Nation's
    existing hydroelectric generation which today provides 10 percent of
    U.S. electricity. With more than 200 hydropower facilities up for
    relicensing in the next decade, early indicators suggest that
    environmental concerns may cause regulators to reduce generation
    capacities for relicensed facilities unless fish mortality and water
    quality concerns are met. EERE is developing and completing testing of
    advanced environmentally-friendly hydropower turbine prototypes that
    will improve water quality and reduce fish kill so that we can retain
    our current hydropower capacity of 75,000 MW.
        Hydrogen.--In fiscal year 2000, our request will continue a strong
    core research and development effort to meet the goals of reducing the
    cost of hydrogen production, increasing the energy density and
    efficiency of solid state storage systems, and developing low-cost,
    reliable sensors to detect hydrogen leaks for a number of applications.
    The program will also support the accelerated development of hydrogen
    vehicle fueling stations in a 50/50 cost-shared venture with industry,
    vehicle mounted storage systems, reversible fuel cells that can be
    integrated with renewable energy systems and small fuel cells for
    remote power applications.
        Superconductivity.--In fiscal year 2000 US leadership in this
    critical 21st Century technology will be visible through several ground
    breaking program successes. In addition to the Detroit cable project
    already mentioned, an advanced and environmentally friendly 10 megavolt
    ampere transformer will be installed in a Milwaukee substation--the
    world's first to supply power to a manufacturing facility. Also,
    testing will continue of the world's largest superconducting motor
    (1000 horsepower--installed fiscal year 1999). Superconducting
    transformers and motors will be half the size of conventional
    alternatives and have only half the energy losses. Another expected
    breakthrough will be the continuous manufacture of an entirely new type
    of superconducting ``tape'' based on discoveries at Los Alamos and Oak
    Ridge National Laboratories. This new ``tape,'' which can now only be
    made in short samples, offers unprecedented performance potential: two
    thin one centimeter-wide metal tapes coated with this new
    superconducting material will be able to carry the same electric load
    as a very large, complex copper cable.
        Competitive Solicitation.--In fiscal year 2000 we propose to create
    an integrated Competitive Solicitation field validation program that
    combines the best elements of the earlier Renewable Indian Energy
    program and the Federal Buildings and Remote Power programs. Highly
    cost-shared, and technologically and regionally-diverse projects under
    this new solicitation will accelerate the development and use of the
    most promising renewable and hybrid renewable/fossil energy systems,
    leveraging as much as $30 million annually in new renewable energy
    projects.
    Management Improvements
        When I became Assistant Secretary seventeen months ago, I realized
    that EERE faced many management challenges and committed to fix them.
    This Subcommittee also highlighted several issues. We have listened to
    you--and to industry and other partners--and we have delivered.
        Competition.--This Committee said that EERE was relying too heavily
    on non-competitive mechanisms to disburse funds. We listened and we
    delivered a dramatic reduction in our use of non-competitive funding
    mechanisms. As you can see from the chart below, our use of broad-based
    solicitations, program management directives, and an increased emphasis
    on competition for laboratory subcontracts, has brought our level of
    competitive awards by the Office of Power Technologies (OPT) to 93
    percent (including Congressionally-directed activities). This
    represents a reduction in OPT's discretionary use of sole source
    mechanisms by almost 60 percent in one year. Close to 100 activities
    previously funded by sole-source contracts within EERE's Energy and
    Water account in fiscal year 1998 will be competitively awarded in
    fiscal year 1999. This is a major success.
        In 1998 we also competed the $1 billion management and operating
    contract for the National Renewable Energy Laboratory, the first time
    it has been competed in 15 years. The resulting contract with a
    partnership of three outstanding organizations--the Midwest Research
    Institute, Battelle, and Bechtel--strengthens the laboratory's
    management team and sharpens its mission focus.
        Uncosted Balances.--This Committee also said that EERE's uncosted
    balances were too high. Again, we listened and we delivered. Across all
    of EERE, we have reduced uncosted balances by more than 58 percent
    since the beginning of fiscal year 1996.
    [GRAPHIC] [TIFF OMITTED] T10AP13.005

        Within the Solar and Renewables R&D account we have made even
    greater progress, reducing uncosted balances by 62 percent since fiscal
    year 1996. By the end of fiscal year 1999, we will have reduced these
    balances by more than $175 million versus the beginning of fiscal year
    1996. This Committee also highlighted the use of support service
    contractors. We listened and significantly reduced the proportion of
    funding directed to support service costs and established more
    streamlined procurement and business practices.
        Management Practices.--While we are proud of the progress we have
    made, we realize that our work to improve the management of EERE is by
    no means complete. For example, I have just established a new
    Management Improvement Team composed of senior managers from across the
    various EERE sectors as well as representatives from our National
    Laboratories, the Golden Field Office, and various DOE Offices to
    improve the corporate management processes and procedures. We expect
    recommendations from this team will increase our ability to
    competitively award even more funding in fiscal year 2000 on a
    competitive basis. Also, we are working with the National Academy of
    Public Administration (NAPA) to undertake an independent review of our
    financial management and procurement practices. This review should be
    completed by the end of October 1999.
    [GRAPHIC] [TIFF OMITTED] T10AP13.006

        Planning and Evaluation.--We are also developing smarter strategies
    and carefully measuring progress in our core mission. We are developing
    a new office-wide strategic plan and using technology ``roadmaps''--
    jointly developed with industry--to ensure we are in step with the
    needs and goals of the marketplace. We are making greater use of the
    Government Performance and Results Act and peer-reviewed measures of
    our technology progress. For example, we have commissioned the National
    Academy of Science to conduct an independent peer review of the Office
    of Power Technologies R&D programs. These tools and practices will help
    provide the data and analysis necessary to help make smart--and
    sometimes difficult--management choices such as our recent decision to
    end work on the solar power tower program in fiscal year 2000. Finally,
    just as any business must do to stay competitive, we are working with
    the Department's Workforce 21 Initiative to ensure we have the right
    training, skills, and human resources available to fulfill our
    challenging missions.
        Program Integration and Expanded Partnerships.--One of our major
    management challenges is breaking through the ``stovepipes'' that often
    separate our various missions. This is important because the solutions
    to many of our renewable energy and energy efficiency challenges cross
    technology and market lines. For example, in the biomass area both the
    private sector industries (i.e., fuels, electric power, and chemical
    products) and our own power, industrial, and transportation programs
    have traditionally operated separately from each other. Leading
    initiatives designed to better integrate our work include those in
    Bioenergy, EnergySmart Schools, and Distributed Power.
        As part of our efforts to integrate our biomass work, we are
    launching a crosscutting Bioenergy Initiative. Biomass represents a
    tremendous, untapped, domestic resource for our energy future,
    particularly as an alternative to imported oil. By investing in a
    bioenergy industry today, we can cultivate and harness renewable
    biomass resources to fuel our cars, power our homes and businesses, and
    supply our chemical needs in the 21st Century. The Department of
    Energy, along with other federal agencies and private partners, is
    launching a national partnership to develop an integrated industry to
    produce power, fuels, and chemicals from crops, trees, and wastes. By
    making a ``ton of biomass'' a viable market competitor to a barrel of
    imported oil, this initiative will help grow the U.S. economy,
    strengthen U.S. energy security, protect the environment, and
    revitalize rural America. This effort will integrate the work from
    existing DOE R&D in transportation biofuels, biomass power and programs
    with the forest products and agriculture industries. It is only through
    the integration of these efforts that biomass will be an effective
    competitor to imported fossil fuels.
        The EnergySmart Schools initiative is an EERE-led partnership that
    brings together public and private sector resources to reduce the $6
    billion in annual energy bills of our Nation's schools and redirect the
    savings to our children's education. EnergySmart Schools will help to
    reduce energy consumption and expand the use of clean energy
    technologies in new and existing schools, improve the learning
    environment, and increase awareness of energy-related issues. It is
    estimated that this initiative--which will coordinate and build on the
    work of existing EERE programs such as Rebuild America, the State
    Energy Program, the Million Solar Roofs Initiative, Clean Cities,
    Energy Star, and the and potential projects under the proposed Solar
    Program Support/Competitive Solicitation program--will help schools
    save up to $1.5 billion in energy costs and lower carbon emissions by
    10 million metric tons by 2010 as they incorporate state-of-the-art
    energy efficiency and renewable energy technologies. Through the
    EnergySmart Schools partnership, we will provide technical assistance,
    demonstrate renewable and energy efficiency technologies, and offer
    guidance on financing and building design.
        EERE is also pursuing a new initiative to encourage the development
    and use of distributed power technologies--i.e., the generation of
    power at or near the point of use. Many technologies can be used in a
    distributed manner, including wind, photovoltaics, combined heat and
    power, concentrating solar power, fuel cells, gas microturbines,
    hydrogen production and storage, battery and flywheel energy storage,
    and hybrid renewable/fossil power systems. The benefits of the
    distributed approach to power generation include reduced consumer costs
    through increased system efficiencies, reduced environmental emissions,
    and increased reliability. Our approach to achieving the benefits is
    three-pronged: (1) R&D to facilitate introduction of distributed power
    applications, such as the development of modular renewable and fossil
    energy systems that can be scaled to need; (2) addressing crosscutting
    regulatory/institutional issues such as our work with the Institute of
    Electrical and Electronics Engineers (IEEE) to develop consensus-based
    interconnection standards; and (3) developing policy options for
    possible inclusion in electricity restructuring legislation.
        Another challenge we are pursuing is to better leverage our
    resources and facilitate technology deployment by expanding
    partnerships with Federal, State, industry, and other entities. These
    partnerships involve other Offices within the Department of Energy
    including the Office of Fossil Energy (FE) and the Office of Science
    (OS) as well as other Federal agencies including the Department of
    Defense, NASA, the U.S. Department of Agriculture, the Department of
    the Interior, and the Environmental Protection Agency. For example, we
    work with FE as we implement our advanced geothermal drilling and
    biomass co-firing with coal programs, and OS is a partner for
    fundamental research on photovoltaic and superconducting materials and
    biomass feedstock genetics.
        At the State and regional level, we have developed closer working
    relationships with State and tribal organizations including the
    Association of State Energy Research and Technology Transfer
    Institutions (ASERTI), the California Energy Commission (CEC), the New
    York State Energy Research and Development Agency (NYSERDA), and the
    Council of Energy Resource Tribes (CERT). For example, the Wind Energy
    program is coordinating R&D with the California Energy Commission and
    an industry partner to develop one of EERE's two Next Generation
    Turbines.
        Of course, in addition to our National Laboratories, our programs
    will continue to tap the innovation and expertise available at the many
    fine universities across the country. We will also continue to leverage
    resources and ensure market acceptance of the technologies we develop
    by pursuing cost-shared partnerships with the Nation's industries,
    utilities and other power providers, and other leaders in the energy
    field. For example, we are working with 18 universities across the U.S.
    to research innovative new photovoltaic conversion technologies and we
    have an extensive research partnership with the Electric Power Research
    Institute (EPRI) to accelerate development of superconducting wire,
    transmission cables, and motors.
    overview of the fiscal year 2000 request for solar and renewable energy
                                  technologies
        Our fiscal year 2000 program level for Solar and Renewable Energy
    Technologies is $398.9 million--an increase of $62.9, or 18.7 percent
    million over fiscal year 1999. The bulk of the EERE Energy and Water
    Development Appropriation supports the work of the Office of Power
    Technologies ($325.2 million). This office works with electric service
    providers and related industries to advance clean, competitive and
    reliable power technologies. We develop renewable energy technologies
    that use solar, wind, hydropower, geothermal and biomass energy
    resources and conduct R&D that will enable a hydrogen energy
    infrastructure in the future. Our program also develops advanced
    technologies--including high temperature superconducting materials,
    real-time power system controls, and energy storage--that will improve
    the energy efficiency and cost-effectiveness of the nation's electric
    systems. Finally, the program facilitates the export of renewable
    energy power generation internationally.
        Included in the Energy and Water Development Appropriation is $53.4
    million for the Office of Transportation Technologies to support R&D on
    production of biomass-based transportation fuels. The requested funds
    also include $19.2 million for Program Direction, which provides the
    Federal staffing resources and associated funding to support the
    management and oversight of the Solar and Renewable programs.
        Table 1 on the following page summarizes our total fiscal year 2000
    budget request, together with the appropriations for fiscal year 1999
    and fiscal year 1997. In the following sections, I describe the details
    of the request. For each major line of the budget, I identify changes
    relative to fiscal year 1999 appropriations and describe program
    specifics and reasons for the requested funding change.

                    SOLAR AND RENEWABLE RESOURCE TECHNOLOGIES
                            [In millions of dollars]
    ------------------------------------------------------------------------
                                                  Fiscal year
                                 -------------------------------------------
                                                           2000    1999-2000
                                     1998       1999     Request     Change
    ------------------------------------------------------------------------
    Solar Building Technology           2.6        3.6        5.5       +1.9
     Research...................
    Photovoltaic Energy Systems.       64.7       72.2       93.3      +21.1
    Concentrating Solar Power...       16.3       17.0       18.9       +1.9
    Biomass/Biofuels Energy            27.8       31.5       39.0       +7.5
     Systems--Power Systems.....
    Wind Energy Systems.........       32.1       34.8       45.6      +10.8
    Renewable Energy Production         3.0        4.0        1.5       -2.5
     Incentive..................
    Solar Program Support \1\...  .........  .........       10.0      +10.0
    International Solar Energy          1.4        6.4        6.0       -0.4
     Program \2\................
    Geothermal Energy Systems...       28.7       28.5       29.5       +1.0
    Hydrogen Research...........       15.8       22.3       28.0       +5.7
    Hydropower Development......        0.7        3.3        7.0       +3.7
    Renewable Indian Energy             3.9        4.8  .........       -4.8
     Resources \1\..............
    Electric Energy Systems and        42.3       40.1       41.0       +0.9
     Storage....................
    Federal Buildings/Remote            4.9        4.0  .........       -4.0
     Power Initiative \1\.......
                                 -------------------------------------------
          Power Technologies....      245.2      272.3      325.2      +52.9
                                 ===========================================
    Biomass/Biofuels Energy            30.3       41.8       53.4      +11.6
     Systems--Transportation....
    National Renewable Energy           3.2        3.9        1.1       -2.8
     Laboratory.................
    Program Direction...........       15.7       18.1       19.2       +1.1
                                 -------------------------------------------
          Subtotal, Solar and         294.4      336.0      398.9      +62.9
           Renewable Energy.....
                                 -------------------------------------------
    Use of Prior Year Balances..      -24.4  .........       -0.8       -0.8
                                 -------------------------------------------
          Total, Solar and            269.9      336.0      398.1     +62.1
           Renewable Energy.....
    ------------------------------------------------------------------------
    \1\ The fiscal year 2000 Budget proposes to consolidate the Renewable
      Indian Energy Resources and the Federal Buildings and Remote Power
      programs through a competitive solicitation under Solar Program
      Support ($10.0). This budget line would also include $2M for
      electricity restructuring.
    \2\ Excludes funding for international energy efficiency programs under
      Energy Conservation.

                       solar building technology research
        The request for Solar Building Technology Research is $5.50
    million, an increase of $1.90 million from current levels. This funding
    will be used to make solar water heaters an economically attractive
    option for families across the U.S. by 2003. It will enable the
    Department to develop a new generation of solar water heaters that is
    50 percent less expensive than today's technology (from $0.08/kWh to
    $0.04/kWh delivered energy cost). This would enable a family to buy a
    solar water heater for about $1,000 and see their investment returned
    in energy savings within four years. To accomplish this, the program is
    divided into three areas: Technology Development ($4.7 million), Field
    Validation ($0.5 million), and Quality Assurance ($0.3 million).
        Within Technology Development (up $1.2 million), researchers will
    select two of the concepts under study that are most likely to enable
    the program to reach its cost goal. Development of these concepts will
    then become the focus of the program during fiscal year 2000. It is
    likely that one or both of these systems will use polymers, including
    advanced plastics, as a replacement for the steel, glass, and copper
    that make up current solar water heaters. Since polymers are
    inexpensive and light weight, their use will reduce the cost of the
    solar collector and lower the cost of installation. Work will include
    testing to determine performance, ability to withstand freezing and
    overheating, and weather degradation. Materials research will be an
    important aspect of this work as several polymers formulations will be
    tested to see which are best suited to long term exposure to solar
    radiation.
        In Field Validation (up $0.5 million) cooperative projects with
    utilities and builders will address some of the technical barriers that
    limit the use of solar water heaters. A Cooperative Research and
    Development Agreement with the Salt River Project (a utility serving
    the Phoenix region) will be completed that develops a roof integrated
    solar water heater that can provide hot water at a levelized cost of
    $0.06 to $0.07/kWh. This project, as well as projects with the
    Wisconsin Public Service and Lakeland Electric, is driven by
    restructuring of the electric industry as utilities seek to provide
    additional products and services to their customers. In addition, solar
    technical support will be provided to builders such as Pulte Homes, the
    second largest builder of U.S. homes, and CAVCO, one of the largest
    builders of manufactured homes. All efforts in this portion of the
    program are limited to R&D activities that include system evaluation,
    analysis of system performance, and assistance in solving problems such
    as materials degradation and corrosion that industry cannot address by
    itself.
        Quality Assurance (up $0.2 million) funding will be used to address
    the reliability of solar water heaters, a primary customer concern.
    Performance and repair data from hundreds of systems that have operated
    for at least five years will be analyzed to identify the components and
    subsystems most in need of improvement. This data will be used to
    refine computer models that predict the reliability of solar water
    heating systems. This information will help the solar industry improve
    the reliability of its product and provide guidance to the researchers
    developing the new generation of solar water heaters.
                          photovoltaic energy systems
        The request for Photovoltaic Energy Systems is $93.3 million, an
    increase of $21.1 million from fiscal year 1999. The Photovoltaic
    Energy Systems program conducts a balanced portfolio of R&D activities
    that help U.S. industry to develop photovoltaic technology as a clean,
    competitive, reliable energy supply option, and to maintain
    technological leadership over strong international competition. The
    increase in fiscal year 2000 will primarily be used to support basic
    research to dramatically reduce dollar per watt values for
    photovoltaics in the long term, and to support technology development
    and deployment to incrementally reduce costs in the near term. Based on
    a multi-year technology plan that has been developed in close
    partnership with industry, this balanced program focuses on three key
    activities that industry and other stakeholders have cited as the most
    critical to maintaining and advancing our lead in PV technology and
    products: Fundamental Research ($20.3 million), Advanced Materials and
    Devices ($27.0 million), and Collector Research and Systems Development
    ($46.0 million).
        The Photovoltaic Energy Systems program is working hard to increase
    competition and reach out to a broader cross section of the industry.
    For example, the Million Solar Roofs Initiative is forming new
    partnerships all across the country with builders, solar equipment
    manufacturers, city planners, financial institutions and utilities.
    Furthermore, the fiscal year 2000 increases for basic research will be
    used to issue competitive solicitations to a larger section of the
    research community seeking new ideas on non-conventional, breakthrough
    technologies.
        Today, the U.S. stands as the world leader in photovoltaic
    technology, with our industry garnering 35 percent of total sales in
    1998. This has not always been the case, however, nor is it guaranteed
    to continue. Leadership in photovoltaic technology was lost in the mid
    1980's because of strong international support for PV development. As a
    result of our expanded support for advanced technology research and
    other DOE-industry partnership programs, the U.S. was able to recapture
    the lead in global market share for photovoltaic modules in 1993.
    However, in the past two years U.S. leadership has eroded, from 44
    percent of total sales in 1996 to 40 percent in 1997 to 35 percent in
    1998.
        The U.S. photovoltaic industry faces intense competition from Japan
    and Europe, which are aggressively researching and marketing their PV
    technology. For example, Japan's fiscal year 1999 budget for
    photovoltaics is 28.54 billion yen (approximately $240 million), which
    is more than three times our funding level. Half of Japan's budget is
    used to subsidize the purchase of residential PV systems. As a result,
    Japan's PV industry sales grew 40 percent in 1998 and are on pace to
    take over world leadership by the end of this year.
        To maintain U.S. leadership--and to penetrate new, larger markets
    such as energy service providers and building applications--the cost of
    PV systems must be more competitive with other sources of electricity.
    Critical improvements in conversion efficiency, manufacturing,
    reliability and system life are essential. The increased funding
    request will enable the PV program, in cooperation with U.S. industry
    partners, to continue the research needed to resolve these technical
    problems.
        Funding for Fundamental Research (up $9.3 million) will continue
    world-class research at national laboratories and universities on
    advanced concepts for improved technology in the post-2000 time frame.
    Activities will include continued research on several photovoltaic
    semiconductor materials to resolve issues that limit current
    technology. This work will advance the understanding of new and
    improved materials, cell structures, layer growth processes,
    semiconductor theory and material characterization methods.
        Starting in fiscal year 2000 we will begin a High Performance PV
    Initiative to support research to substantially increase the efficiency
    of two key technologies: large area, single crystal interconnected thin
    films, and multi junction concentrator cells made from elemental (III-
    V-based) materials such as antimony, arsenide, gallium, phosphorous,
    indium, or nitrogen. Fundamental research aimed at major innovations is
    required to essentially double the conversion efficiency of thin films
    from their current 8-10 percent to 15-20 percent, and to increase III-
    V-based multi junction cells from 30 percent to 40 percent under 500X
    solar concentration. Successful development of a 40 percent efficient
    four-junction laboratory cell will allow a 33 percent efficient
    concentrating module under a solar concentration of 500X, thereby
    capturing one third of the sun's energy. Both the enhanced thin film
    approach and the multi junction III-V approach will yield dramatically
    reduced dollar per watt values for terrestrial photovoltaics. Also new
    in fiscal year 2000 will be a competitive solicitation on basic R&D for
    breakthrough, non-conventional PV technologies, such as liquid cells,
    polymers, biochemical and biomimetic processes, etc., aimed at dramatic
    cost reductions. Both of these new basic research activities will be
    core program efforts to meet the Program's long term goals of $0.06/kWh
    electricity.
        Advanced Materials and Devices (no change) will continue
    collaborative research with industry to improve device efficiency and
    stability, particularly for large-area, thin-film deposition systems.
    The centerpiece of this activity is the Thin Film Partnership Program,
    a government/industry/university partnership program to accelerate
    development of cost-effective thin film technologies. Photovoltaic
    devices employing thin-film technology significantly reduce the amount
    of semiconductor material required for power generation. Also, because
    such devices are amenable to mass production, they offer significant
    potential for cost reduction--which would make possible widespread use
    of such technologies as PV shingles. Module reliability research will
    continue to support testing of modules to improve operational lifetime
    in the field.
        Collector Research and Systems Development increases (up $11.8
    million) will be used to help reduce manufacturing costs of
    photovoltaics, develop building integrated products, accelerate
    electric utility use of photovoltaics, and expand work in support of
    the million solar roofs initiative. Key to maintaining U.S.
    competitiveness over the next five to ten years, manufacturing process
    research and development under the Photovoltaic Manufacturing
    Technology (PVMaT) partnership will continue cost-shared research with
    industry to reduce module manufacturing costs, improve module
    performance, and stimulate investment in new manufacturing production
    lines. As a result of this cost-shared R&D with industry, average
    manufacturing costs for DOE partners have declined by 50 percent since
    PVMaT began and are expected to decline by another 40 percent by 2004.
    In fiscal year 2000, a PVMaT competitive solicitation to develop new in
    line process diagnostics and state-of-the-art measurement and
    characterization equipment needed for module scale-up will be issued,
    resulting in 5-7 new industry cost-shared contracts. A new solicitation
    will be issued for highly leveraged utility projects designed to
    provide utilities with hands-on experience with PV systems, and
    validate technical and economic performance in specific high-value
    applications such as building integrated applications. A portion of the
    increase will also be used to fully fund Phase 3 building integrated
    contracts under the PV:BONUS program, which supports cost-shared
    efforts with industry and others to develop PV products that can be
    integrated into commercial and residential buildings.
        In addition, a part of the increase in Collector Research and
    Systems Development (up $1.5 million) will be targeted at specific
    activities that support the million solar roofs initiative. An
    important goal of this initiative is to help develop a significant
    domestic market for U.S.-manufactured solar energy systems, to provide
    a firm base for U.S. industry expansion and market competitiveness.
    Without such a base, as is being actively pursued in other countries
    such as Germany and Japan, it is likely that PV systems will become an
    example of technology developed here but exploited abroad.
        In fiscal year 2000, the Million Solar Roofs Initiative will work
    with 25 State and Local Partnerships across the nation which have made
    preliminary commitments to install over 750,000 solar energy systems by
    2010. These Partnerships work to eliminate barriers to the use of solar
    energy and create market demand. The members of the Partnerships often
    include utilities and energy services companies, builders and
    developers, financial institutions, solar equipment manufacturers and
    distributors, local government, state and Federal agencies and other
    solar energy interests. Work will be expanded that includes development
    of additional financing mechanisms, elimination of technical barriers
    like the safe interconnection of photovoltaics to the utility grid,
    technical training and establishment of net metering. Establishment of
    the national Million Solar Roofs registry to track system installations
    will also be fully implemented. Additionally, the Initiative will also
    work to ensure that solar energy systems meet the requirements and
    standards of state and local codes and standards. To ensure that the
    Initiative is responsive to the State and Local Partnerships, the DOE
    Regional Support Offices will coordinate Federal support and provide
    technical assistance. As the largest single user of energy in the U.S.,
    the Federal government is committed to installing 20,000 solar energy
    systems on its own facilities by 2010. In fiscal year 2000, the
    Initiative has an interim goal of 2,000 Federal solar energy
    installations.
                       concentrating solar power program
        The fiscal year 2000 funding request for the Concentrating Solar
    Power (CSP) Program (formerly the Solar Thermal Energy Systems program)
    is $18.85 million (up $1.85 million). The CSP Program leads the
    national effort to develop clean, competitive, and reliable power
    options using concentrated sunlight. Ranging in size from several
    kilowatts to multi-megawatt installations, CSP systems can satisfy
    substantial domestic and international energy needs, contributing up to
    20,000 MW by the year 2020. Consequently, CSP systems are also expected
    to make a significant contribution to the U.S. effort to reduce carbon
    emissions in the early part of the 21st Century. An advantage of
    concentrating solar power systems is the capability of being deployed
    as either a distributed power system or as a dispatchable power system
    (when hybridized), or both.
        In response to the changes brought on by utility restructuring and
    the resulting emphasis on competition, the CSP program has revised its
    focus from developing specific technologies to providing technology
    options to U.S. industry that will enable them to compete in near-term
    renewable energy markets and further reduce the costs for long-term
    penetration of broader energy markets. This paradigm shift has led to
    the four new program technology paths described below.
        Under the first path, Distributed Power Systems, ($6.7 million
    requested, up $1.4 million) the CSP Program will work with three
    industry partnerships to develop and demonstrate reliable dish/engine
    systems. Under the Utility Scale Joint Venture Project (USJVP), three
    25 kW systems are undergoing intensive reliability monitoring in fiscal
    year 1999 and fiscal year 2000, with a near-term goal of reaching 1,000
    hours between down times. In order to encourage competition, a second
    solicitation was issued for alternative designs under the Dish/Engine
    Critical Components (DECC) Project in fiscal year 1998. Awards were
    made and operating hours are being accumulated on this system to prove
    reliability. Next-generation improvements are being incorporated in
    fiscal year 1999, with a completely-modernized, full-scale 25 kW
    prototype system to be installed in fiscal year 2000. A third project
    was launched in fiscal year 1999 to field an advanced-technology 10 kW
    solar dish/engine system at a remote site in the Southwestern U.S. In
    fiscal year 2000, the off-grid capability of the system will be
    developed and tested. These systems are equally suited for either
    stand-alone operation or for being hybridized with natural gas or
    diesel fuel.
        The focus of the second path is to reduce the costs of Dispatchable
    Power Systems ($5.34 million, down $0.63 million). Based on the results
    of an industry-led trough technology roadmap, a number of component and
    system improvements were identified as being able to reduce the costs
    of near-term trough plants from the current 10-12 cents/kWh to 6-
    8 cents/kWh. To meet this need, the USA Trough Initiative was launched
    in fiscal year 1999. Fiscal year 2000 work will focus on optimization
    of the collector design, improved system integration with conventional
    power plants (e.g., natural gas combined-cycle). This initiative will
    reopen a domestic market for trough systems and provide a leading
    position for U.S. industry in bidding on projects currently before the
    World Bank. Additional activities include a SolMaT effort to develop
    low-cost drives and concentrators.
        Path three, Advanced Components and Systems ($5.96 million
    requested, up $0.97 million), addresses the longer- range R&D required
    for CSP systems to achieve energy costs in the 4 to 6 cents/kWh range,
    thus allowing penetration of broader domestic and international
    markets. In fiscal year 2000, the program will continue current project
    work focused on higher-temperature technologies, the development of
    durable reflective materials, and higher efficiency system designs
    through the improvement of both solar concentrators and receivers.
        The fourth path, Strategic Alliances & Market Awareness ($0.85
    million requested, up $0.11 million), covers technology transfer,
    communications, and technology roadmapping efforts to ensure that the
    CSP program is focused on the needs of industry and the realities of
    the marketplace. Analyses and studies conducted in fiscal year 2000 by
    the world-class researchers at SunLab (a ``virtual'' laboratory
    comprised of the CSP researchers at Sandia National Laboratories and
    the National Renewable Energy Laboratory) are heavily relied upon by
    U.S. industry, Federal and State agencies, and other organizations
    involved in renewable energy development.
                              wind energy systems
        The fiscal year 2000 funding request for the Wind Energy Systems
    program is $45.6 million, an increase of $10.8 million over the fiscal
    year 1999 appropriation. The mission of the Wind Energy Systems program
    is to enable U.S. industry to complete the research, testing, and field
    verification needed to fully develop advanced wind energy technologies
    that lead the world in cost-effectiveness and reliability. Wind energy
    has been the fastest growing source of energy in the world for the last
    decade, with capacity additions worldwide totaling over 2000 MW in 1998
    and industry sales of over $2 billion. Wind power stations in Europe
    and developing countries account for most of the recent capacity
    increases, using wind turbines supplied primarily by European
    companies. While wind power development in the United States is
    beginning to recover from several years of stagnation, prospects for
    sustaining this growth are still highly uncertain as electric power
    markets deregulate and place increased emphasis on low cost of energy
    production. The key to positioning wind as an important U.S. clean
    energy option for new competitive power markets, as well as export
    markets, is the development of innovative, cost-competitive technology
    that is being carried out under the Wind Energy Systems program. The
    program is currently partnering with industry for R&D targeted to
    reduce cost of energy from wind to 2\1/2\  cents/kWh at sites with good
    winds.
        In fiscal year 2000, the Wind Energy Systems program will focus on
    Applied Research ($13.5 million), Turbine Research ($20.2 million), and
    Cooperative Research and Testing ($11.9 million).
        Applied Research (up $2.8 million) addresses fundamental
    engineering and technology issues with a broad range of applications,
    and is carried out at National laboratories and numerous universities.
    The requested increase will support the Wind Partnerships for Advanced
    Component Technologies (WindPACT) project. Under WindPACT, promising
    research ideas and concepts generated in Applied Research will be
    further developed and tested by a joint team of industry and laboratory
    researchers on a component and subsystem basis. WindPACT will develop
    improved wind technology components such as self-protecting rotors,
    passive aerodynamic controls, and new generators that can readily be
    incorporated into new turbine designs beyond those now included in the
    Next Generation Turbine project. This competitive effort is expected to
    attract new players into the wind industry because partnerships between
    new entrants and existing wind companies will be encouraged and
    previous technical experience with wind will not be required.
        Turbine Research (up $3.8 million) is a cost-shared cooperative
    program with industry and utilities that supports competitively-
    selected research, testing, and field verification needed for advanced
    technology wind turbines. The requested increase for Turbine Research
    will support continuing partnerships with seven companies, and
    initiation of several new field verification projects that will be
    tailored to satisfy specific regional needs. Two companies are
    designing turbines under the Next Generation Turbine project, which is
    targeted to reduce energy costs from wind systems to 2\1/2\  cents/kWh
    at 15 mph wind sites by 2002. In fiscal year 2000, these companies will
    require increased funding as they enter into a period of peak design
    activity and hardware procurement for their engineering and
    manufacturing development prototype turbines. The Near Term Research
    and Testing project will be completed in fiscal year 2000, yielding
    several technological advancements for a more cost effective 750 kW
    turbine, to help U.S. industry compete in current world markets.
    Testing of prototypes will commence under the Small Wind Turbine
    project, and several new field verification projects using small (up to
    100kW) wind turbines will be in operation. The program will also take
    the lead in completing R&D and field verification for a wind turbine
    intended for use in extreme cold environments, such as Alaska and the
    Antarctic, as the third phase of a Small Business Innovation Research
    project begun by the National Aeronautics and Space Administration and
    the National Science Foundation.
        Cooperative Research and Testing (up $4.2 million) focuses on near-
    term R&D and testing at the world-class National Wind Technology Center
    (NWTC) in Colorado, which features a user facility that allows U.S.
    industries to expand testing of new wind energy technologies. The
    requested funding increase will launch a new cooperative effort with
    industry--Hybrid Systems for Village Power--which will build upon the
    experience with ongoing wind hybrid power projects in Alaska and
    provide opportunities for field verification on new wind control
    systems and system integration options. In addition, a new Wind
    Monitoring Network will provide verifiable data on long-term
    performance of several large new wind projects. This information is
    needed for developing strategies to accelerate the use of wind energy
    under the new rules of the emerging competitive power markets. NWTC
    capabilities for providing accredited certification testing services
    will be expanded, and efforts will continue in establishing U.S.
    certification capability for wind turbines in cooperation with
    Underwriter's Laboratories (UL). UL is now offering certification
    services to the wind industry--one wind turbine company has already
    contracted for UL certification--and will begin to work with the NWTC
    staff to define certification procedures. NWTC staff are presently
    developing quality assurance, testing, and design evaluation procedures
    which will be used to test turbines for UL certification.
                               biopower/biofuels
        We are requesting $92.4 million for Biopower/Biofuels programs in
    fiscal year 2000, an increase of 21 percent. This includes $6.0 million
    to support the Bioenergy Initiative described earlier in this
    testimony. The Initiative is an integrated effort spread among three
    sectors within the Office of Energy Efficiency and Renewable Energy in
    partnership with the private sector. The program supports biomass
    energy projects aimed at three principal markets: electric power;
    transportation fuels; and chemicals.
        The following is a brief discussion of the Biopower and the
    Biofuels Programs:
    Biopower Program
        The budget requests for the Biopower program with the Office of
    Power Technologies is $38.95 million in fiscal year 2000--an increase
    of $7.5M over fiscal year 1999. The Biopower Program mission is to
    integrate sustainable biomass feedstock production with efficient
    biomass power generation systems that can provide substantial energy,
    economic, and environmental benefits. The program focuses on
    collaborative partnerships between the Department and the private
    sector to conduct critical research, development, and cost-shared
    demonstration activities. Through the introduction of competition to
    the generation market, power producers who can also produce a variety
    of energy related co-products will capture an increasing volume of
    electricity sales. These applications will provide broader based, near
    term markets for advanced biopower systems. The program's goal is the
    establishment of 30,000 MW of renewable biomass capacity installed by
    2020. The request includes $2.7 million for Thermoconversion and $32.15
    million for Systems Development. Also included under collaborative co-
    funding with biofuels are $3.1 million for feedstock development and
    $1.0 million for the regional biomass energy program.
        Thermoconversion.--The increase in Thermoconversion (up $1.2
    million) will support basic research in biomass combustion and
    gasification characteristics, especially related to cofiring biomass
    with coal (a major near-term, low-cost market opportunity) and as
    applied to integrated gasification power producing systems.
        Systems Development.--Within the Systems Development activity (up
    $5.8 million), $5.5 million is requested for the Vermont Gasifier
    Project, $17.3 million is requested for the DOE/USDA Biomass Power for
    Rural Development Initiative (an increase of $1.8 million), $5.4
    million is requested for the Co-firing Biomass with Coal Initiative (an
    increase of $2.9 million), and $4 million is requested for Small
    Modular Systems Development.
        The Vermont Gasifier project will demonstrate a pilot-scale state-
    of-the-art gasifier combined with an advanced turbine, producing
    approximately 8-12 MW of electricity from wood. In fiscal year 2000, a
    hot-gas clean-up unit will be installed and the integrated combined
    cycle gasification systems will be operated for 1,000 hours at double
    the efficiency of direct- fired biomass units.
        The Biomass Power for Rural Development initiative in fiscal year
    2000 would support three projects: (1) co-firing tests of a 35 MW
    retrofitted plant with switchgrass in Chariton Valley, Iowa project
    will begin and up to 3600 acres of switchgrass will be planted ($1.8
    million); (2) cofiring tests of willow and coal will be conducted along
    with the completion of retrofit of two additional coal plants and up to
    600 acres of willow will be planted as part of the New York Salix
    project ($1.5 million); and (3) construction of the 75 MW Minnesota
    Valley Alfalfa Producers integrated gasification combine cycle power
    plant ($14 million).
        The Co-firing Biomass with Coal initiative, currently conducting
    test runs on the effectiveness of blends of coal and biomass, will
    expand in scope to additional sites to include biomass gasification.
    Sustained operations at selected sites will also be demonstrated.
    Modular systems development is funding feasibility studies, prototype
    demonstrations, and proceeding to full systems integration and
    development of smaller gasification units (5kW to 5MW).
    Transportation Biofuels
        The Transportation Biofuels Energy Systems program within the
    Office of Transportation Technologies has a budget request of $53.4
    million in fiscal year 2000--an increase of $11.7 million over fiscal
    year 1999. The mission of this program is to research, develop, and
    demonstrate cost competitive technologies for the production of liquid
    transportation fuels, in collaboration and partnership with industry,
    other government organizations, and academic institutions. In support
    of this mission, the program pursues the development of low-cost
    biomass energy feedstocks and cost competitive conversion technologies
    for liquid fuels production from agricultural residues, forestry
    wastes, and energy crops. The development and deployment of biofuels
    technologies can displace 0.30 quads of primary energy by 2010 and 0.84
    quads by 2020, while promoting rural economic development. Since
    biofuels produce almost no net carbon on a life cycle basis, they are a
    very promising supply side option for reducing carbon emissions in the
    transportation sector.
        The requests of $53.4 million for the Transportation Biofuels
    Energy Systems Program includes $37.4 million for ethanol production,
    $1.0 million for biodiesel production, and $6.0 million for integrated
    bioenergy research and development. The request includes $5.5 million
    for feedstock development and $3.5 million for the regional biomass
    energy program (collaborative co-funding with the Biopower program).
        Ethanol production (up $1.5 million) is a major focus of the
    Transportation Biofuels program, comprising 70 percent of the budget
    request. Currently, ethanol is being used as a blend with gasoline in
    10 percent ethanol/90 percent gasoline mixtures, can be used in
    flexible fueled vehicles (up to 85 percent ethanol blends) and is being
    considered for use in fuel cells.
        We have established three industrial partnerships for the
    construction of ethanol production facilities using waste biomass.
    These highly leveraged partnerships, with DOE providing around 20
    percent of the costs will result in ``first of a kind'' commercial
    technology demonstration plants. We recently attended a ground breaking
    ceremony for the construction of the first partnership project--a 20
    million gallon waste to ethanol facility in Jennings, Louisiana. The
    other two partnerships are to build ethanol production facilities in
    California and New York. We are also working with the existing corn
    (starch based) ethanol industry to demonstrate biomass (cellulose)
    technology as add-on facilities using corn stalks and corn fiber to
    increase production and improve economic viability of the process. At
    least one feasibility study for an add-on facility will be completed in
    fiscal year 1999.
        The program will also continue advanced technology research and
    development at our National Laboratories will improve energy conversion
    and integrated process efficiencies and address key cost factors to
    reach the production cost goal of $0.72 per gallon by 2010.
        The Biodiesel program (up $0.2 million) will continue research and
    development of efficient technologies for the production of biodiesel
    to lower the cost of a biomass-based alternative to diesel fuel.
    Opportunities for converting low- cost waste oils will be explored.
    Collaborative Funding by Biopower and Biofuels
        The $8.6 million Biopower/Biofuels request for Feedstock
    Development (up $3.5 million) will expand the research and development
    to increase the number of crop species for regional diversity and the
    increase of the number of yearly harvesting in order to improve the
    economics utilization of feedstock for production. These feedstocks
    will provide a sustainable, reliable supply of biomass which can be
    used for the production of fuels, chemicals and power. The Biopower/
    Biofuels request for the Regional Biomass Energy Program of $4.5
    million (up $1 million) will continue regionally focused activities
    with State and local governments to increase the development and use of
    biomass resources for multiple products.
                 renewable energy production incentive program
        The request for the Renewable Energy Production Incentive Program
    is $1.5 million, a $2.5 million decrease from fiscal year 2000 funding
    levels. Annual appropriations provide financial production incentives
    to stimulate the construction and operation of new, qualified renewable
    energy facilities owned by state entities, municipal utilities, and
    electric cooperatives that produce and sell electricity. We estimate
    that fiscal year 2000 payments to qualified Tier I facilities--which
    use solar, wind, geothermal or dedicated (closed-loop) biomass
    resources--will require approximately $0.3 million to pay for
    electricity generated and sold. Remaining funds will be applied to
    qualified Tier II facilities, and include non- dedicated (open-loop)
    biomass resources (which would not be eligible for renewable energy tax
    credits if they were owned by private industry).
        A number of very legitimate concerns regarding the proposed cut in
    REPI funding have been raised by the public power community. We are
    carefully revisiting this issue.
                             solar program support
        The fiscal year 2000 request for Solar Program Support is $10
    million, $8 million for a Competitive Solicitation which would combine
    current the current Renewable Indian Energy Resources and Federal
    Buildings/Remote Power programs to encourage innovative applications
    and deployment of renewable electric technologies and would provide $2
    million for Electricity Restructuring.
        The $8 million requested for a Competitive Solicitation (down $0.8
    million from the predecessor programs) will speed early deployment of
    renewable technologies by seeking technology proposals on the best ways
    to use renewable technologies, either singly or in combination with
    other renewable technologies, or in hybrid configurations with fuel
    cells, natural gas or energy storage systems.
        The two primary objectives of the Competitive Solicitation program
    are: (1) to prove the availability of clean, affordable, and reliable
    electric power supply options for the many remote and/or economically
    challenged regions of the Nation; and (2) to obtain essential data on
    operational performance, reliability, and benefits of renewable energy
    and hybrid renewable energy systems in various geographic locations and
    climatic conditions.
        The information and experiences gained through this Competitive
    Solicitation program will also help overcome specific impediments to
    more widespread use of renewable electricity technologies. Currently,
    renewable energy projects are hampered by the uncertainties of electric
    utility restructuring, the current low price and perceived availability
    of natural gas, and improvements in gas turbine technology. The
    increasingly competitive restructured electric environment also favors
    technologies with low capital costs over technologies with higher
    capital costs, but lower life cycle costs. Rather than high project
    technical or financial risk, the major hurdle often facing renewable
    energy projects is identification of project structures in the new
    marketplace that would allow acquisition of long term power purchase
    contracts and project financing. Such new structures include renewable
    energy power marketers, hybrid projects with renewables and natural
    gas, investments in distributed renewable electricity generation, and
    customer choice.
        This six-year, highly-leveraged program would combine two previous
    budget items--the Renewable Indian Energy Resources and Federal
    Buildings/Remote Power programs--into a single, integrated, technology-
    focused competitive field validation program. (Compared to the prior
    programs, funding is reduced by $0.8 million.) In keeping with the
    origins of this program, the Solicitation program would designate two
    targeted areas for competitive awards--systems benefitting Native
    Americans and systems addressing the needs of Federal facilities--in
    addition to providing for an ``open'' solicitation for other
    applications of these systems. Remote power needs will continue to be
    addressed as aspects of all three segments of this solicitation. Of the
    $8.0 million proposed for fiscal year 2000, up to $3.0 million of the
    solicitation will be dedicated to projects benefitting Native
    Americans. Native American projects will require a minimum 20 percent
    cost-sharing, and the ``open'' portion of the solicitation will require
    at least 75 percent non-DOE funding. For a number of reasons, there are
    tremendous synergies between renewable energy technologies and the
    energy needs of Native Americans. Renewable resources such as solar and
    wind are often abundant on tribal lands. In addition, Native Americans
    often have substandard or, in some cases, no electricity service.
    Renewable energy technologies can often provide the most cost-effective
    option for providing electricity on tribal lands and can also be a
    source of employment for tribes installing such systems onsite.
        The request for Electricity Restructuring for fiscal year 2000 of
    $2 million represents an increase of $100,000 over fiscal year 1999
    appropriations. The purpose of the Department's electricity
    restructuring activities is to develop a comprehensive understanding of
    emerging electricity competition policies across the country and their
    impacts on renewable energy and energy efficiency products and
    services, and the impacts on various public benefit programs such as
    low-income assistance.
        The program will provide technical assistance and analysis to
    State, Federal and tribal decision makers and others to assist them in
    their efforts to achieve their renewable energy, energy efficiency, and
    consumer protection goals as the industry is changed. This work is
    critical to renewable and energy efficiency technologies because the
    new electricity market and regulatory rules will have a major impact on
    future technology deployment.
        Due to the introduction of competition the electricity sector is
    undergoing the most significant transformation that has occurred in
    over 60 years. Fourteen States have enacted retail competition
    legislation to permit customers to choose their electricity supplier
    and four others have issued comprehensive competition orders. Fourteen
    other States ended their 1998 legislative sessions with comprehensive
    retail competition bills pending.
        The transition to competition is challenging for a number of
    reasons including the technical complexity of the electricity system,
    the intricate web of Federal, State, and local law and regulation, and
    regional differences. As a consequence, policy makers at all levels of
    government need analysis and technical assistance on a portfolio of
    market and policy mechanisms to achieve their restructuring goals. The
    demand for this assistance is very high. For example, as part of the
    recent broad-based solicitation, the Department received far more
    restructuring-related analysis and technical assistance proposals than
    our resources can support.
        Although each State and region face unique electricity policy
    challenges, there are many common issues. Furthermore, many States lack
    the resources and expertise needed to address the complexities of
    electricity restructuring and to keep track of what other States are
    doing. Consequently, it is often more cost-effective and efficient for
    certain technical assistance and analysis to be provided at the federal
    level rather than duplicated on a State-by-State basis. In addition,
    although a plethora of studies and analyses funded by entities with
    economic interests in certain restructuring outcomes exist, user-
    friendly information from independent entities on key policy issues is
    often in short supply. The EERE electricity restructuring program works
    to fill this information gap.
        The restructuring program is also important to the development of
    EERE's own research and development agenda. The success of our R&D
    agenda hinges, in part, on assuring that the technologies we help
    develop are compatible with the rapidly evolving electricity market
    structure. Thus, the restructuring program informs our R&D work. For
    example, the introduction of competition is likely to favor modular,
    distributed systems that are less capital intensive than central
    station plants. In response, many of our R&D programs are increasingly
    focused on modular applications.
        In fiscal year 2000, the Department proposes to expand technical
    analyses on the impacts of electricity restructuring on renewable
    technologies and energy efficiency technologies. Analyses on market
    mechanisms such as labeling of electricity products for consumers,
    ``green'' certification, and energy services strategies will be
    completed. The program will provide tools and information for policy
    makers to develop legislative and regulatory policies that lead to
    competitive, reliable electricity markets with a range of energy
    options including renewable energy and efficiency technologies. To
    facilitate these efforts, the program will also encourage the States
    and others to form regional information exchange networks to share
    ``lessons learned'' about what does and doesn't work.
                      national renewable energy laboratory
        The fiscal year 2000 request of $1.1 million for the National
    Renewable Energy Laboratory (NREL), (down $2.8 million), is to provide
    for maintaining NREL facilities to assure appropriate scientific and
    technical support for Solar and Renewable Energy R&D activities. The
    request will fund infrastructure renovations and upgrades at the NREL
    sites, including minor modifications, road repair, safety fencing, roof
    repairs, and the installation of a 2,000 square foot multi-user
    prefabricated facility for solar radiation research. In addition, the
    request will fund acquisition of a variety of critical multi-program
    laboratory equipment needed to upgrade or replace old equipment, and
    also provide for the upgrading of the laboratory's data system
    infrastructure.
                               geothermal energy
        The Geothermal Energy request for fiscal year 2000 is $29.5
    million, an increase of $1.0 million over fiscal year 1999 levels. The
    Geothermal program in the Office of Geothermal Technologies works in
    partnership with U.S. industry to establish geothermal energy as a
    sustainable, environmentally sound, and economically competitive
    contributor to the U.S. and world energy supply. These joint efforts
    sponsor research and development that leads to advanced technologies to
    improve reliability, reduce environmental impacts, and lower costs of
    geothermal energy systems. The budget request supports the five goals
    of the Geothermal Energy Strategic Plan for 2010 which have been
    endorsed by industry: supplying the electrical power needs of 7 million
    U.S. homes; providing the heating, cooling, and hot water needs of 7
    million U.S. homes; meeting the basic energy needs of 100 million
    people in developing countries; ensuring that the United States
    continues to lead in geothermal technology; and developing new
    technology to meet 10 percent of U.S. non-transportation energy needs.
    In contrast to last year, the budget request is allocated solely for
    Geothermal Electric R&D and Development ($29.5 million). No funds are
    requested for Geothermal Heat Pump Deployment in fiscal year 2000. The
    $29.5 million request is allocated among: reservoir technology, $8.0
    million; exploration, $7.0 million; drilling $7.5 million; and energy
    conversion, $7.0 million.
        The Reservoir Technology program (+$2.5 million) will perform water
    injection tests at a commercial site at Dixie Valley, Nevada, develop a
    suite of chemical tracers for tracing the flow of injected water, and
    use field test data to improve reservoir models. These efforts will
    lead to proper fluid management practices which could enable a
    geothermal field to operate productively for over 100 years. The
    Enhanced Geothermal Systems initiative under the Reservoir Technology
    program will focus on extending the productivity and lifetime of
    geothermal reservoirs through rock fracturing, stimulation, and water
    injection.
        The Exploration program (+$1.5 million) will collaborate with
    industry on 3D-seismic techniques to locate and characterize new
    geothermal fields. Individual geophysical methods will be integrated to
    develop ``smart'' systems which will select more reliable exploration
    targets. Greater effectiveness in locating geothermal resources will
    greatly reduce the number of non-productive wells.
        The Drilling program (+$2.5 million) will complete the testing of
    improved PDC drill bits, unshielded high-temperature logging tools, and
    a high-temperature casing inspection tool. The Geothermal Advanced
    Drilling System will be initiated which will give economic access to
    the extremely large geothermal resources contained in rocks at great
    depth. One element of the Geothermal Advanced Drilling System is a high
    speed data link that will transmit a variety of real-time drilling data
    to the surface for decision making while drilling. About 50 percent of
    the cost of the high speed data link will be provided by major private
    sector partners. In addition, a consortium for high-temperature
    electronics suitable for applications in geothermal wells will be
    formed by the Gas Research Institute, Honeywell, Boeing, other industry
    leaders, and the Drilling program. Finally, the program will transfer
    to industry the technology to acoustically align downhole line shaft
    pumps which will save industry millions of dollars annually.
        In the Energy Conversion program (+$1.0 million), the Kalina Cycle,
    a new plant design for more efficient and cost-effective electricity
    generation, will be tested in partnership with industry. The non-
    Federal cost share of this demonstration project is over 60 percent.
    The program will also field test gas monitors and anti-fouling coatings
    for heat exchanger tubes which will reduce geothermal power plant
    operating and maintenance costs. The new Modular Geothermal Power Plant
    initiative under the Energy Conversion program will support the design,
    construction, and testing of a small (300 to 500 kW) power module for
    distributed or off-grid sites. This initiative creates a supply option
    for developers wishing to install small-scale geothermal plants which
    can be used in remote, off-grid, and/or grid-connected locations,
    providing flexibility in adapting to the changing electric power
    industry. This is particularly important because geothermal is emerging
    as an attractive ``green power'' customer choice option as program R&D
    continues to cut power generation costs.
        Competition is key to the cost-effective management of geothermal
    R&D activities. All three geothermal initiatives described above, as
    well as many other research and development activities, will be
    competed through solicitations.
                                    hydrogen
        The request for Hydrogen is $28 million, an increase of $5.7
    million from fiscal year 1999. Industry is investing substantially in
    both hydrogen production systems and the development of the Proton
    Exchange Membrane (PEM) fuel cells that require a hydrogen stream to
    operate. Buses powered by fuel cells with onboard hydrogen are being
    tested in metropolitan districts, and residential fuel cell systems are
    entering into pre-commercial testing. These ventures portend commercial
    activities for the distributed production, storage and utilization of
    hydrogen by 2001 to 2003.
        The Hydrogen Program is authorized by the Hydrogen Future Act of
    1996 to fund those projects which are evaluated on a competitive basis.
    In fiscal year 1999, the Department funded 92 percent of the Hydrogen
    Program through four competitive solicitations. The fiscal year 2000
    request will support a balanced program to increase market penetration
    of renewable/hydrogen energy systems and hydrogen-powered vehicles, and
    long-term research and development in the production of hydrogen from
    renewable resources through a similar competitive process. The program
    focuses on three key activities: Core Research and Development ($14.1
    million), Technology Validation ($11.4 million), and Analysis and
    Outreach ($2.5 million).
        Core Research and Development (up $5.0 million) supports R&D on
    hydrogen production, storage and utilization. The increased funding
    will fully fund thermal conversion processes that produce hydrogen from
    natural gas with a 25 to 35 percent decrease in the cost of producing
    hydrogen over conventional processes. Long-term research programs will
    also be enhanced in awarding multiple cooperative agreements for
    photobiological and scaled-up photoelectrochemical processes. These key
    activities, in conjunction with the industrial development of the PEM
    fuel cell, will enhance the ability of the industry to consider low-
    cost hydrogen options for power, industry and transportation market
    sectors by 2004.
        Storage R&D is focused on developing and demonstrating hydride and
    carbonaceous materials for the storage of hydrogen at low temperatures
    for power and transportation applications. The increased funding will
    permit the award of one project to characterize a family of new metal
    hydride materials and another award to assemble carbon absorbents into
    a laboratory system.
        Utilization technology is focused on developing and demonstrating
    end-use power systems that are safe, and have near-zero or zero
    emissions with an overall generation efficiency greater than 45
    percent. A newly developed solid state hydrogen leak detector prototype
    design will be fabricated and field tested. A low-cost 25 kWe fuel cell
    will be demonstrated.
        Technology Validation (up $0.4 million) supports 50/50 cost-shared
    ventures with industry on hydrogen vehicle fueling stations, vehicle-
    mounted hydrogen storage systems, reversible fuel cells to operate with
    renewable systems, and small hydrogen fuel cell systems for remote
    power applications. The fiscal year 2000 request supports the operation
    of a reversible fuel cell with 60 percent round-trip efficiency; the
    incorporation of high-pressure hydrogen storage on vehicles;
    construction of a quick-fill refueling station to service Las Vegas
    shuttle buses and government vehicles; and the design and construction
    of small-scale fuel cells for remote applications.
        Analysis and Outreach (up $0.3 million) conducts portfolio and
    technology analyses to determine what steps are required to transition
    to a hydrogen energy economy. Technology analyses will periodically
    review specific areas (i.e., thermoconversion, storage, etc.) to ensure
    that research is of high quality and of significance to the overall
    objectives of the program.
                                   hydropower
        For fiscal year 2000, the Department is requesting $7.0 million for
    Hydropower Development, an increase of $3.8 million over fiscal year
    1999 funding. With this funding, the program will complete proof-of-
    concept testing of an innovative, non-shearing ``fish-friendly''
    turbine design (competitively selected in earlier activities) and will
    provide for the completion of experiments to develop biological
    performance criteria for advanced turbine design. The program will also
    initiate the competitively selected engineering design of a ``fish-
    friendly'' turbine to increase dissolved oxygen.
        Once complete, these new turbines can replace equipment at existing
    facilities where environmental concerns may cause a reduction in
    generation. Hydropower provides approximately 10 percent of the total
    U.S. electricity generation today; diminished power production from
    this clean baseload power resource would have serious environmental and
    economic impacts on our nation. This cost-shared program with industry
    would maximize power generation from hydropower facilities and help
    develop an important export market for U.S. companies.
                      electric energy systems and storage
        $41.0 million is requested for the Electric Energy Systems and
    Storage program in fiscal year 2000, an increase of $0.9 million from
    fiscal year 1999. The program is working with partners to develop
    advanced power systems that will make the delivery of electric power
    more efficient and cost effective, reduce power sector emissions,
    facilitate market penetration of renewables, and enhance U.S.
    industrial competitiveness. The program includes efforts on
    Transmission Reliability Research ($4.0 million), High Temperature
    Superconductivity ($31.0 million), Energy Storage ($6.0 million), and
    Climate Challenge (no funds requested).
        The fiscal year 2000 budget request for Transmission Reliability
    Research is $4.0 million, an increase of $1.0 million from fiscal year
    1999. Before electric restructuring, vertically integrated utilities
    sold electricity and reliability services from central station power
    generators over transmission lines that were constructed to serve
    specific load areas. This system was not designed to allow competitive
    sales of energy and services from any generator to any customer, and
    the resulting constraints to this type of operation must be resolved
    cost effectively to allow full market competition. Transmission
    Reliability provides Federal support to develop technologies and policy
    options that will maintain and improve the reliability of the Nation's
    electricity delivery system during the transition to competitive power
    markets. The program is being implemented through a National
    Laboratory/electricity industry partnership, and is leveraging funds
    from other partners. Transmission Reliability has two key activities:
    Power System Reliability ($3.8 million) and Distributed Power ($0.2
    million).
        Power System Reliability (up $1.3 million) will develop advanced
    computational and information systems to monitor and control the power
    system in real time, and advanced power electronics to accomplish fast,
    high-power switching under real time system control. Reliability
    technologies and policy options are developed in the context of
    competitive markets, and research will account for changes in market
    forces as rules and restructuring legislation are developed and
    implemented. Real-time control of the power system can provide
    information to remove transmission bottlenecks and operate the system
    in a way that can turn ``two-lane roads'' into ``superhighways,''
    releasing capacity for competitive markets.
        Distributed Power (down $0.3 million) funding will continue
    development of technologies, and removal of technical, regulatory, and
    institutional barriers to enable the integration of distributed
    generation and storage into the electric and natural gas systems.
    Distributed technologies include renewable resources, fuel cells,
    microturbines, battery and flywheel storage, and direct load control.
    Integration of these technologies offers environmental and economic
    benefits and extends competition to the retail customer level.
        It is anticipated that the Transmission Reliability program will
    last approximately five years and will ensure that research and
    development for reliable systems and competitive markets is maintained
    until new market and/or regulatory structures are developed that
    provide the incentives for the private sector to assume this work. The
    program will be reassessed each year to determine the need for Federal
    involvement depending on the nature and implementation needs of new
    regulations, and the impact of market forces.
        The fiscal year 2000 budget request for High Temperature
    Superconductivity is $31 million, a decrease of $1.5 million. The
    funding is divided between the Superconductivity Partnership Initiative
    ($14.0 million), Second Generation Wire Initiative ($8.0 million) and
    Strategic Research ($9.0 million). The program is accomplishing two
    major technological goals: solving the difficult problem of
    manufacturing electrical wires from the family of brittle ceramic
    superconducting materials, while, in parallel creating designs of
    super-efficient electrical systems. The products will be resistance-
    free electrical wires that carry 100 times the current of conventional
    alternatives and the design of advanced systems that have only half the
    energy losses and are half the size of conventional alternatives of the
    same power rating.
        The Superconductivity Partnership Initiative (down $0.5 million)
    will support six major projects to develop first-of-a-kind electrical
    systems that can provide quantum improvements to the efficiency and
    capacity of the national electrical grid. These include transmission
    cables, transformers, large motors, flywheel energy systems and
    magnetic separation systems that meet required performance goals. The
    revolutionary equipment emerging from the program in the 2005-2010
    timeframe will have a major role in meeting the new demands of a
    competitive electricity industry for increased capacity and
    reliability. Superconducting cables will relieve congestion at critical
    parts of the grid as well as improve delivery efficiency. They will
    also allow load growth in urban areas to be accommodated by repowering
    existing ducts, without the need for acquiring new property.
    Superconducting transformers will accommodate increased demand for
    electricity without the need for construction of new substations and
    will protect against accidental ``fault currents'' that now cause
    serious damage and power outages. The program's past success has
    demonstrated that this extremely ambitious undertaking is possible
    within the funding requested due to careful planning and leveraging of
    resources. Leveraging includes the 50 percent cost share that the
    program has been able to attract, even though the projects are very
    high risk. Additional leveraging occurs through the project teams being
    a vertically integrated consortium of companies containing a future
    user (an electric power company), a manufacturer, and a superconducting
    component supplier. The funding reduction will result in research being
    completed in fiscal year 2001 rather than in fiscal year 2000, but is
    not expected to impact accomplishment of important goals.
        The Second Generation Wire Initiative (no change) is crucial to
    producing superconducting wire that meets the program's performance
    goals. Four industrial consortia will be working with the national
    laboratories to scale up recent discoveries that are the basis for this
    initiative. Private sector participants' 50 percent cost-sharing
    leverages program funds.
        The Strategic Research program element (down $1.0 million from
    fiscal year 1999) is the incubator for discoveries and innovations that
    have characterized this successful program. The activities supported
    include in-house national laboratory research and joint research
    carried out with private companies under 50 percent cost-shared
    agreements. The requested level of funding will adequately support
    multi-disciplinary research teams that have made major breakthroughs in
    the past, and will also support a number of cooperative research
    projects with industry. Important leveraging is obtained through
    integrating research funded by the DOE Office of Science and leveraged
    research at two NIST (National Institute of Science and Technology)
    laboratories where each program dollar is matched by two NIST dollars.
        The $6.0 million request for the Energy Storage Systems program (up
    $1.5 million) will fund focused research on energy storage technologies
    which will reduce the high cost of power outages, improve power
    quality, and enhance technology choices in a competitive utility
    environment. Efficient energy storage is critical for service
    reliability and for the success of distributed power generation. In a
    restructured electricity industry with many independent power
    producers, energy storage will play an increasingly crucial role in
    combining multiple inputs of varying power quality and matching output
    to a changing load. Program emphasis will be placed on battery systems
    integration and on the development and evaluation of advanced storage
    technologies. All projects will be carried out in close cooperation
    with industry.
        No funding is requested for the Climate Challenge program in fiscal
    year 2000 (down $0.1 million).
                       international solar energy program
        The fiscal year 2000 budget request for the International Solar
    Program is $6.0 million, a slight decrease of $350,000 from $6.350
    million in fiscal year 1999. The mission of the International Solar
    Energy Program is to encourage acceptance and use of renewable energy
    technologies by developed and developing countries in support of U.S.
    national interests and policies. With World Bank estimates indicating
    that developing countries alone will require five million megawatts of
    new electricity capacity over the next four decades (the world's total
    installed capacity today is three million megawatts), international
    markets will provide growing opportunities for U.S. sales of advanced
    renewable energy and energy efficient technologies and job creation.
    And it is these same technologies that also hold the greatest potential
    for mitigating global climate change.
        The primary goal of the International Solar Energy Program is to
    support the expansion of U.S. renewable energy and energy efficiency
    technology exports to help meet the energy needs of developed and
    developing countries, reduce the rate of consumption of finite global
    resources, and address local and transnational environmental issues.
    The program has been refocused in response to Congressional direction.
    While the Program will continue to provide support for the U.S.
    Initiative on Joint Implementation, all activities will be refocused
    into three broad program areas: Emerging Global Environmental and
    Energy Issues (USIJI), facilitating Market and Trade Development, and
    advancing U.S. Energy and Environmental Security interests.
        The Emerging Global Environmental and Energy Issues will be
    implemented specifically through and in conjunction with the U.S.
    Initiative on Joint Implementation (USIJI). USIJI is a DOE-led
    interagency program that supports the development of flexibility
    mechanisms under the U.N. Framework Convention on Climate Change (U.N.
    FCCC) such as Joint Implementation (JI), Clean Development Mechanism
    (CDM), and Emissions Trading. This element will also focus on
    encouraging meaningful participation by developing countries in the
    effort to reduce worldwide greenhouse gas emissions.
        The Market and Trade Development element will accelerate reductions
    in U.S. technology production costs and advance deployment of
    technologies through overseas market expansion. Activities will focus
    on stimulating global economic development and regional economic
    stability, and accelerating domestic economic growth, market
    competitiveness, and employment. This element will be implemented in
    key regions through bilateral (e.g., Gore-Mbeki in South Africa) and
    multilateral (e.g., Asia Pacific Economic Cooperation, Hemispheric
    Initiatives and International Energy Agency) technology cooperation
    activities and information exchange and dissemination. Private sector
    technology development will be encouraged while seeking opportunities
    for leveraging U.S. funds and stimulating deployment in strategic and
    emerging markets through project-based activities.
        The Energy and Environmental Security element is designed to
    advance U.S. strategic interests in bilateral and multilateral energy
    and environmental security activities and will provide specialized
    assistance in the utilization of appropriate technologies. This element
    will be implemented in support of existing and emerging bilateral and
    multilateral treaties and agreements (e.g., U.S.-China Energy
    Efficiency and Renewable Energy Protocol). This element will also
    assist the Department in meeting U.S. obligations and commitments to
    provide disaster relief and assistance by facilitating private sector
    technology development and deployment in strategic and emerging
    markets.
                            solar program direction
        The fiscal year 2000 Congressional Request for Solar Program
    Direction is $19.2 million, an increase of $1.1 million. Program
    Direction provides the staffing resources and associated funding to
    support the management and oversight of the Solar and Renewable Energy
    Programs. It also provides funding for all support services, the
    Working Capital Fund, and crosscutting requirements.
        There are two principal changes in Solar Program Direction this
    year. First, funding for electricity restructuring, included under this
    account in fiscal year 1999, is provided for under Solar Program
    Support in fiscal year 2000. Second, the request includes $1.85 million
    to address anticipated staffing adjustments resulting from Workforce 21
    plans.
        Workforce 21 is a Department-wide effort to address unintentional
    negative impacts resulting from aggressive downsizing in recent years.
    While the Department has been able to fill most essential positions
    through intra-agency transfers and a very few replacement hires (even
    as we met or exceeded our reduced workforce targets) some gaps in
    filling critical technical and professional positions still remain. The
    Program Direction request level will enable EERE to fill limited number
    of key technical and professional staff positions at DOE headquarters
    and in the field. Clerical and administrative positions will remain
    essentially level.
                                   conclusion
        Thank you once again, Mr. Chairman, and members of the Subcommittee
    for the opportunity to discuss our fiscal year 2000 budget request. I
    hope you agree that the management improvements we have instituted--and
    continue to refine--are enhancing the value received by American
    citizens for their investment. We believe that the technologies our
    programs are now developing will lead to a clean, cost-effective, and
    secure electric power and transportation fuel system for the United
    States. We fully understand that we must set and meet aggressive
    technology research and performance goals so that the new power
    generation, power delivery, and transportation fuel systems we are
    developing can compete in the marketplace. And while the task before us
    is certainly challenging, we are confident that our proven record of
    achievement--combined with hard work, careful planning, and adequate
    financial and workforce resources--will lead to even more success
    ahead, enabling the Nation to respond not only to the important energy
    and environmental challenges but also to the global market
    opportunities of the next century.

                    appropriate use of appropriated funding

        Senator Domenici. Let me just ask a couple of questions.
    While you are there, I will go with you first, and if Senator
    Reid has any questions, can you answer them within two weeks?
        Mr. Reicher. Yes, sir.
        Senator Domenici. Last year, we raised concerns about your
    office, and among those were paying for members of industry
    associations to attend national and international conferences,
    publishing magazine articles, writing op ed-style articles in
    magazines, and preparing talking points in support of the
    Department's programs.
        You have told us about your competitiveness initiative,
    which is a great effort. What about this kind of activity, what
    are you doing about these sorts of things?
        Mr. Reicher. Well, Mr. Chairman, as a part of our push to
    increase competition, we have encompassed those kinds of
    activities. What we basically said to groups of all sorts, from
    trade associations, to universities, to others, is that if you
    want to work with us you are going to have to compete for the
    dollars.
        So virtually all that we are now doing, this sort of public
    outreach communications, is now being done on a competitive
    basis, so I think that should very quickly and very much lead
    to the end of those kinds of sole source situations.
        Senator Domenici. Well, I guess what I really need is for
    you to be more specific for a minute. We were paying groups to
    publish magazines about solar energy. Now, does that come
    within the definition that you just described, that you may
    still be doing it, but it is going to be competitive?
        Mr. Reicher. Let me say it this way, Mr. Chairman. We now
    compete the dollars for what we call information dissemination
    and public outreach. Within that, we fund a variety of
    mechanisms for communicating the technology progress of our
    work. So what I want to stress to you is that first, these are
    competitive mechanisms that we are using.
        Second, by virtue of the fact that they are competitive, we
    are looking very carefully to avoid the kind of funding
    situations you are speaking about in the past. So I am quite
    confident that the kinds of problems that you have seen, that
    you have raised, that you have highlighted for us are no longer
    the case with what we are going forward with in terms of our
    work.
        Senator Domenici. Well, I would like you perhaps by the end
    of this fiscal year to give us a report on this new approach
    that you have taken--how it has affected the kind of activity
    that we were complaining about, what is being done in terms of
    industry association members being paid to go to international
    conferences. Do your Requests for Proposals envision that the
    Department pay people to go to international conferences that
    are not part of our government team?
        Mr. Reicher. It does not envision that, Mr. Chairman.
        [The information follows:]

     Report on Information and Dissemination Activities, Office of Energy
                        Efficiency and Renewable Energy

        The Office of Energy Efficiency and Renewable Energy will provide a
    report to the Subcommittee providing details on how financial
    assistance for Information and Dissemination activities was competed in
    fiscal year 1999. The report will explain the process used to compete
    the financial assistance activities and summarize the types of
    activities that were funded. The report will be provided by September
    30, 1999.

        Senator Domenici. Okay. Talking points in support of the
    Department's programs, you have outside groups preparing those.
        Mr. Reicher. Again, that is not the sort of thing that we
    intend to be----
        Senator Domenici. I know this could be, to some, kind of
    nit-picking, but I do not think it is. I think it is not what
    the Congress of the United States thinks we are doing in this
    area. The committee has an oversight and stewardship
    responsibility to understand if appropriated funds are being
    used wisely, so that we do not end up looking silly about
    funding a program that does not do R&D. We need to bring these
    renewables on board as soon as possible, and make realistic
    choices with reference to their effectiveness.
        That is kind of your job, and, again, I say I think you are
    doing very well at it.

                                  kyoto accord

        Do you know very much about the Kyoto Accord in terms of
    what it requires and what its goals are, and the like? Are you
    an expert on that, or do you know something about this area?
        Mr. Reicher. I know something about it.
        Senator Domenici. Okay.
        Mr. Reicher. I do not consider myself an expert.
        Senator Domenici. So might I ask you, is it possible for
    the United States to meet the mission goals of the Kyoto Accord
    on the path we are on now?
        Mr. Reicher. On the current path we are on now, the
    business as usual path, we would not meet those goals.

                                carbon fuel tax

        Senator Domenici. A number of groups indicated in order to
    meet the goals of the Kyoto Accord that we would have to impose
    a substantial tax on carbon fuels, somewhere in the area of $45
    per barrel, if that tax is imposed on oil. Do you anticipate
    that if we did that, that would have an effect on the American
    economy? If you do not think that is what is required, then
    just say I do not think the $45 is what anybody is thinking
    about.
        Mr. Reicher. Let me say it this way, there have been a
    range of projections about what it would take to meet the Kyoto
    goal. The Council of Economic Advisors has done a study that
    suggests that it can be met more cheaply than I believe the
    figures you are suggesting would indicate, a combination of
    international emissions trading and advances in technology to
    bring prices--to bring the cost of technologies and the use of
    clean technologies to market.
        Also, five of the national laboratories produced a study a
    couple of years ago that also suggested that we could meet much
    of the Kyoto goal with only modest increases in terms of the
    cost of fuel and energy.
        Senator Domenici. I think, based on what you read, and you
    have just indicated that you read a myriad and a diversity of
    things, you would easily recognize that, from an economic
    standpoint, one of the things that affects the American economy
    most significantly and most rapidly on the inflation side is
    increased costs of energy to a typical American consumer from
    his automobile, to the energy source that ultimately heats his
    home.
        Mr. Reicher. Absolutely.
        Senator Domenici. If that goes up 15 or 20 percent, it is
    pretty hard to control inflation regardless of the other
    economic curbs that we are permitted with in terms of--and you
    are aware of that.
        Mr. Reicher. Yes. Mr. Chairman, I would just stress that
    the other really two-thirds of the office that I run is devoted
    to, in fact, improving the efficiency of energy use, so that
    interestingly, even if the price of a particular unit of energy
    were to rise, if we can use it more efficiently, that can net
    out at zero or only a modest increase for consumers.
        So one approach is improving the efficiency of energy use,
    the others, as you have heard this morning, is developing a
    very broad and diverse set of energy resources, and the more
    that those are domestic, the better off we will be.
        Senator Domenici. How are we doing with reference to
    efficiency? Are we sliding backwards? We were moving ahead
    rather wonderfully 8 or 10 years ago. I think we kind of lost
    our----
        Mr. Reicher. We, to some extent, have leveled off, in terms
    of the efficiency of use, and that is why, in fact, we feel it
    is so important to continue to make the strong kinds of pushes
    that we have made between industry and government. For example,
    in the area of automobiles, we are at a good path now to be
    producing an affordable 80-mile-per-gallon automobile, U.S.
    built, in the middle of the next decade, and obviously, that
    will have a dramatic impact on fuel use, production, and U.S.
    competitiveness.
        Senator Domenici. Well, let me move to Mr. Magwood for just
    a minute. Do you pay for any magazine articles that promote
    nuclear power?
        Mr. Magwood. Do we pay for any magazines?
        Senator Domenici. Yes.
        Mr. Magwood. I am a member of the American Nuclear----
        Senator Domenici. No, no, no, I mean--you personally do pay
    for them. I'm asking about your program office.
        Mr. Magwood. If you are asking do we fund people to put
    articles in newspapers and magazines, no, we do not do anything
    like that.
        Senator Domenici. Does your office pay for the preparation
    of pamphlets that are put out by pro-nuclear groups?
        Mr. Magwood. No.
        Senator Domenici. Do you pay for editorials to be written
    by somebody in the outside that might be promoting nuclear
    power?
        Mr. Magwood. No.
        Senator Domenici. I raise this, because I actually believe
    that if they did, we would just have one firestorm. It would
    seem to me that those that are anti-nuclear would talk about
    this not being the business of government to be involved in
    promoting nuclear power, and frankly I think that is the case
    for all power.
        We either say get government involved in promoting nuclear,
    based upon its contribution to the American economic system and
    to energy resources in conservation, or we do not do any of it.
    I feel rather strongly about that.
        I would think if you did that with $300,000 of Office of
    Nuclear Energy money it would not take us 1 week from the time
    it hit the marketplace, even if it was authentic and true, but
    just because it was about nuclear, somebody would be camping
    over on the White House steps or over at the Vice President's
    office saying, what is this about using money to promote
    nuclear energy.

                         nuclear powerplant relicensing

        Now, having said that, let me ask you, how are we
    proceeding with reference to expediting in a rational way, in a
    healthy way, relicensing of nuclear powerplants? Can you give
    us your advice and update us on where we are?
        Mr. Magwood. I think the early signs are very good. I have
    met with all of the commissioners at the Nuclear Regulatory
    Commission, I have met with the senior staff, and I have also
    met with the industry to talk about this issue, because I think
    it is so important. I have been extremely pleased with what I
    have heard. I am very encouraged with the attitude and approach
    the NRC has taken toward relicensing.
        They recognize this as an opportunity to show that they can
    provide safe regulation of nuclear powerplants, in a manner
    that is very efficient and fair. They have worked very closely
    with the industry to carry out their duties, doing so in such a
    way that the process does not drag on for a long time.
        Additionally, I met with senior executives from Baltimore
    Gas and Electric, and they tell me that they expect to complete
    their action with NRC to relicense the Calvert Cliffs nuclear
    powerplant about 2 years ahead of schedule.
        Senator Domenici. Excuse me, I need to take a brief recess.
        [A brief recess was taken.]
        Senator Domenici. Please proceed.
        Mr. Magwood. I was just saying that my understanding is
    that the first examples of the license renewal process,
    Baltimore Gas and Electric's application and Duke Power's
    application have both gone very well and are well ahead of
    schedule. It is my understanding that these relicensing actions
    will be completed almost 2 years ahead of schedule. We are very
    pleased with what is going on so far.

                   nuclear energy research initiative [neri]

        Senator Domenici. Last year Congress provided you with $19
    million for nuclear energy research initiative. You have
    requested $25 million for fiscal year 2000. How much interest
    have you received from researchers for the $19 million?
        Mr. Magwood. There has been a great deal of interest
    expressed in NERI. I believe we have received about 308
    applications from researchers all over the country, from
    universities, from industry, from national laboratories, and
    combinations, there is a lot of collaboration in that
    community, which we are very pleased to see, and they have
    proposed research over 3 years worth around $300 million for
    the $19 million.
        So the interest has been very high, and in addition to the
    proposals we have received, as I have indicated earlier, the
    international community is also very excited. We have been
    talking with Europeans, Koreans, the Japanese, and they are all
    very interested in working in cooperation with our NERI
    program. So the interest is extremely high.
        Senator Domenici. When are you going to award contracts
    under that program, Mr. Magwood?
        Mr. Magwood. Mid- to late May. We will award the first
    contracts in the middle of May.
        Senator Domenici. The middle of May. Will the $25 million
    simply continue the awards funded in 1999, or will you be able
    to have some new ones?
        Mr. Magwood. Well, the way we have structured this program,
    we allow people to tell us what they think they are going to
    need over a 3-year period. We make no commitment beyond the
    first year. We can only provide them 1 year of money at a time,
    but assuming that we actually award a contract, we would not
    require an awardee to reapply for the money in the following
    year; therefore, a lot of the money that we will use in fiscal
    year 2000, if we get the $25 million, will go to simply
    continue work that is already started.
        I would say probably about $20 million of the $25 million
    would go simply to continue work that has already started.

                                moly-99 program

        Senator Domenici. Mr. Magwood, I understand that when the
    Department submitted its budget for 2000 that the Department
    planned to privatize the Moly-99 program at Sandia by September
    of this year.
        Mr. Magwood. Yes.
        Senator Domenici. I understand that there may be some
    reluctance by the private sector to assume responsibility. Do
    you still plan to privatize this by September?
        Mr. Magwood. We had a conference with the private sector at
    Sandia National Laboratory I believe just last week, and we are
    still having discussions with the industry. It is clear they
    clearly would have liked to have seen us go forward with the
    Food and Drug Administration approval process for Moly-99
    before talking about privatization, but they have not said at
    this point that where we are now is not acceptable. We think
    there is still some room to negotiate, and we are still
    optimistic that we will be able to do this.
        Senator Domenici. State for the record essentially what the
    Moly-99 program is.
        Mr. Magwood. Moly-99 is a precursor to Technetium-99m,
    which is used by U.S. clinicians in diagnosing all sorts of
    illnesses, heart disease, and cancer through imaging processes.
        Senator Domenici. So it is in the medical field.
        Mr. Magwood. Yes. My understanding is that it is used about
    36,000 times a day in the United States.
        Senator Domenici. If you do not get it privatized by
    September as planned, will you need additional funds for the
    privatization effort?
        Mr. Magwood. We have not requested additional funds,
    anticipating privatization. Our budget is rather limited, so we
    really were not able to support both maintaining activities
    such as placing a new isotope reduction facility at the LANSCE
    facility in Los Alamos, while at the same time continuing Moly-
    99.
        So we had to make some tough choices, and the choice we
    made was to move forward with the privatization. If we are not
    successful in privatizing we will have to reassess the
    situation, but there is no money in our request to support that
    at this time.

                         fast flux test facility [fftf]

        Senator Domenici. Your budget request assumes that a
    decision to restart, permanently shut down, or maintain the
    FFTF in its current condition will be made this spring.
        Mr. Magwood. That is correct.
        Senator Domenici. Has the decision been made? If the
    decision is made to restart it or permanently shut it down, how
    much additional funds will be necessary?
        Mr. Magwood. Our budget, as you indicated, assumes a
    decision will be made by the end of April, and Secretary
    Richardson told me just yesterday that he fully expects to make
    that commitment and make his decision before the end of April.
        To answer your question about the funding, we currently
    have $30 million requested in the budget. If we continue in
    standby and proceed with an environmental impact statement, we
    will require about an additional $10 million. If the decision
    is to shut it down immediately, it will require I believe about
    an additional $20 million.

                                     ebr-ii

        Senator Domenici. Now, EBR-II reactor for fuel treatment
    program at Argonne, that laboratory is expected to encounter a
    $20 million reduction in this year's budget. Are you going to
    make, at some later date, a decision about whether to use the
    electrometallurgical process technology to treat the EBR-II and
    other fuels?
        Mr. Magwood. Yes. We currently are developing in an
    environmental impact statement regarding the use of
    electrometallurgical technology for treating all of the
    Department's sodium-bonded fuel. This EIS will be completed by
    the end of the year, and also by the end of the year we will
    complete, or rather the National Academy of Sciences National
    Research Council, will complete their review of this
    technology.
        They have had a team that has been looking at this since
    the beginning of our research program. The Secretary will use
    this information in making a decision about whether to go
    forward with the use of this technology on a production scale,
    or whether to shut down the program. I have talked with the
    Deputy Secretary about this several times--if we decide to shut
    it all down, we will not require any new funding, but if we
    decide to move forward we will have to seek some sort of new
    funding, or seek a reprogramming of some sort.

                   nuclear energy research advisory committee

        Senator Domenici. I just have two remaining questions. Let
    me ask them now while we have you here, even though I am using
    considerable time. I think it is good that you have created a
    Nuclear Energy Research Advisory Committee. You have indicated
    who they are, a few changes, for obvious reasons.
        Your office uses this group, I assume, to help you with
    reference to the direction and focus of your program. Has that
    committee reviewed your current research program?
        Mr. Magwood. That is ongoing right now. There are actually
    several activities going on within the advisory committee
    review of our research activities. One is being led by Dr. John
    Ahearne, of Sigma Xi, who is conducting a long-term research
    and development strategy, and he has accumulated a large group
    that is going to be studying that over the next several months.
        Dr. Richard Reba, from the University of Chicago, who is an
    expert in nuclear medicine, is analyzing our isotope production
    research plans. Finally, Dr. John Taylor, who is retired from
    Electric Power Research Institute, is leading a group that will
    be assessing the near term needs, when I say near term, within
    10 years, of research for existing nuclear powerplants. So we
    have really tried to cover all the ground in our program, and I
    think that the NERAC has been a very valuable contributor to
    that.
        Senator Domenici. That kind of an approach that you have
    just described and intend to use, would it or could it result
    in an advisory group telling you where the deficiencies in a
    research program are that are imminent or necessary or the
    like?
        Mr. Magwood. Absolutely.

                   nuclear energy plant optimization program

        Senator Domenici. Okay. We spoke a little bit about the
    nuclear energy plant optimization program, although we did not
    call it that. You and I discussed where we were on relicensing.
    That is sort of the same thing. Last year we passed the nuclear
    energy plant optimization request in our appropriations and it
    did not get out of the full Congress.
        I think we need an explanation of the significance and
    importance of it, so rather than just answer that for me now,
    would you supply a succinct answer in writing to why we need
    it, you and your experts indicate, so that we can make the case
    both on the floor and in the committee.
        Mr. Magwood. I would be happy to.
        [The information follows:]

            Nuclear Energy Plant Optimization Program Justification

                      how nuclear energy helps our nation
        A reliable and affordable electric power supply is a prerequisite
    for a strong economy and sustained growth. The United States has
    enjoyed such a supply of affordable electricity principally because of
    the diversity in its fuel mix. Nuclear energy is an important part of
    this diversity and since the oil embargo of 1973, it has provided about
    one-half of the electricity needed to meet demand growth. It has proven
    to be an extremely safe and reliable source of electricity supply,
    e.g., in the winter of 1996 when rivers were frozen and coal barges
    could not get to power plants, nuclear power plants continued to
    operate. Not only are the fuel and technology used in the nuclear
    energy completely domestic, but the fuel costs for nuclear are a
    smaller fraction of the production costs and are far more stable when
    compared with the fuel costs for fossil fuels. Therefore, the use of
    nuclear energy tends to insulate the economy from fossil fuel price
    fluctuations.
             how existing nuclear power plants help the environment
        Nuclear energy generates electricity without emitting any
    greenhouse gases or other harmful air pollutants such as sulfur oxide
    and nitrogen oxides. It has played an important role in limiting U.S.
    emissions by avoiding two billion metric tons of carbon emissions since
    1973. The 104 nuclear power plants in the U.S. provide approximately 20
    percent of the electricity generated and avoid more than 150 million
    metric tons of carbon emissions annually. Continued operation of the
    existing nuclear power plants (75 percent) another 20 years beyond
    their current license terms could reduce emissions by 64 million metric
    tons between 1995 and 2010, 208 million metric tons by 2015, and 2260
    million metric tons by the middle of the next century. Also, with new
    requirements for lower emissions of sulfur dioxide and nitrogen oxide
    for fossil plants, particularly in the eastern part of the nation, the
    contribution of existing power plants in avoiding harmful air emissions
    becomes even more important. These plants are critical to achieving our
    international goals on climate change and to meeting current
    requirements under the Clean Air Act.
      why it is important to ensure continued operation of nuclear power
                                     plants
        In order to ensure a continued high standard of living for the
    American people, we need to maintain a diverse, secure energy portfolio
    of fossil fuels, nuclear energy, and renewables. Currently solar and
    wind energy provide less than one tenth of one percent each of the
    total energy consumption in the United States. Due to inherent
    limitations of energy intensity available for solar and wind power,
    their share is not expected to become significant in the near future.
    The share of electricity generation from non-hydroelectric renewable
    electric generators was 1.21 percent for 1997. Their share including
    co-generation was 2.1 percent in 1997 and Energy Information
    Administration (EIA) projects it to grow to 3.23 percent in 2020 in the
    reference case forecast. However, if a state or federal mandated
    requirement of a renewable portfolio standard (RPS), which specifies
    that 5.5 percent of electricity generated (or sold) in the state must
    be produced by qualifying renewable power plants (these generally
    include all renewable facilities except hydroelectric plants and
    municipal solid waste), is achieved, and if we assume that the yields
    for energy crops grown on pasture and crop land will be nearly 20
    percent higher than expected in the reference case, then by applying
    the most optimistic assumptions for capital costs, operation and
    maintenance expenses, and capacity factors for non-hydroelectric
    renewables, their share of generation is limited to be no more than
    6.22 percent of total electricity generated in the U.S. in 2020.
        Hydroelectric power currently supplies close to 10 percent of U.S.
    electricity needs but its expansion potential very limited due to a
    lack of available new sites, high construction costs, growing
    environmental concerns, and competing uses of water resources. The
    share of hydroelectric generation is projected to decline from 9.96
    percent in 1997 to 6.7 percent in 2020.
        Therefore, despite environmental concerns, use of coal and natural
    gas to generate electricity must continue. Nuclear energy generation
    must continue as well. The EIA projects that even with aggressive
    energy efficiency measures, U.S. electricity consumption will increase
    by 1.4 percent per year through 2020--the equivalent of seven large
    1,000 megawatt power plants each year. During this same period, 127,000
    megawatts of existing electricity generating capacity could be retired
    because of age, competitive pressures, and as part of U.S. utility
    measures to meet clean air standards.
        Continued operation of existing nuclear power plants is an
    important hedge against uncertainties associated with meeting emission
    limitations for fossil plants and is critical to meeting demand in the
    future and sustaining our energy supply infrastructure.
      issues that could impact continued operation of nuclear power plants
        Deregulation of electricity production in the United States has
    increased economic uncertainties in the electricity sector. Existing
    and proposed environmental laws are causing the closure of older
    fossil-fuel plants. Similarly, we are at a critical juncture with
    regard to the continued operation of nuclear power plants in the United
    States. Licenses for U.S. nuclear power plants will begin to expire in
    large numbers in 2010; licenses for 13 plants representing some 11,700
    MWe will expire in 2014 alone. A few utilities have decided to close
    older, less efficient nuclear facilities before their license
    expiration date. Six reactors closed before license expiration with the
    resultant loss of approximately 4,000 megawatts of U.S. generating
    capacity in the past three years.
        However, over the last couple years the strategic landscape has
    started to change. Two years ago, with electricity restructuring
    looming and concerns over regulatory uncertainty, the prediction was
    that existing nuclear generation capacity was doomed--that fewer plants
    would seek license extensions and that many would shut down
    prematurely. Today, with consolidations in ownership occurring and
    several plants proceeding and making good progress with license
    renewal, it is clear that there is a future for the majority of U.S.
    nuclear plants. However, for these plants to remain viable beyond 2020,
    both government and industry must take action--government reducing
    regulatory and other barriers to operation and industry, investing
    capital in upgrading their facilities for the future and investing in
    short-term R&D.
        Industry must continue to carry the burden of short term research
    and they are meeting this challenge very well with an investment
    approaching $100 million annually. Most of this research is aimed at
    enhancing day to day operational performance and to respond to
    regulatory and other relicensing issues. On the other hand, there is a
    clear role for the government in filling the void in intermediate term
    research--research as proposed by the Nuclear Energy Plant Optimization
    (NEPO) program to address plant aging issues and to improve safety and
    reliability of existing nuclear power plants.
                    independent advice on nuclear energy r&d
        The President's Committee of Advisors on Science and Technology
    (PCAST) Panel on Federal Energy Research and Development recognized the
    critical role of nuclear power in its report of November 5, 1997. The
    Panel's report recommended that the Department work with its
    laboratories and industry to develop a program jointly funded with
    industry, to address the problems that may prevent the continued
    operation of existing nuclear power plants.
        The nuclear industry has consistently urged DOE to assume this
    important role. A number of letters to the Secretary of Energy from
    Kurt Yeager, CEO of Electric Power Research Institute (EPRI), and from
    EPRI's Nuclear Power Council, comprised of the nuclear utility
    executives who guide the industry's collaborative R&D program, were
    sent to DOE in 1997 and 1998 in support of this role.
              the nuclear energy plant optimization (nepo) program
        Existing nuclear power plants serve the broad national strategic
    interests of expanding the economy, providing for energy security, and
    improving the environment. Recognizing these national interests, and
    consistent with the Comprehensive National Energy Strategy and
    recommendations of PCAST, the Department proposes, the NEPO program,
    beginning in fiscal year 2000. The goal of NEPO is to ensure that
    current nuclear plants can continue to deliver adequate and affordable
    energy supplies up to and beyond their initial 40-year license period
    by resolving open issues related to plant aging, and by applying new
    technologies to improve plant economics, reliability, and availability.
        As a program that addresses higher risk, more long-term R&D than
    that performed by industry, and as a program addressing issues
    associated with existing nuclear power plants, it would be conducted in
    at least 50-50 cost shared collaboration with industry and with close
    coordination with the Nuclear Regulatory Commission.

        Senator Domenici. Did you have anything else you wanted to
    add, sir?
        Mr. Magwood. No. I would just like to say that I appreciate
    your interest in this issue. It has been gratifying to have
    Members of Congress take a leading role and actually pushing us
    along in some areas, perhaps areas that we had not even really
    thought much about, but I appreciate your interest and
    involvement.

                        micro-machines program at sandia

        Senator Domenici. Thank you very much. Dr. Krebs, let me
    ask you about a technology that is not within your
    jurisdiction, but ask if you are familiar and if you know about
    it. Do you visit Sandia National Laboratory very often?
        Dr. Krebs. I have visited Sandia Laboratories several times
    during my time in this job.
        Senator Domenici. Are you aware of a research project they
    have going in terms of nuclear safety, but it has some very
    other significant uses called micro-machines?
        Dr. Krebs. I have seen some of their work in that area and
    some of the--they send me pictures and I have gone through that
    part of the laboratory.
        Senator Domenici. The reason I was asking is because I
    trust your judgment and I was going to ask if you were as
    interested in it as a future technology as I have become, but
    since you are not that familiar you would not have an
    observation on that, would you?
        Dr. Krebs. Not particularly about micro-machines, but as I
    noted in my testimony, we are very engaged in exploring the
    performance of materials on a nano-scale, and the next step
    after that is taking it into technological applications. Now,
    these small machines are not quite at nano-scales yet, but
    nonetheless, you have to start someplace.
        Senator Domenici. Well, there is just a gigantic interest
    in them----
        Dr. Krebs. Right.
        Senator Domenici [continuing]. What they are doing,
    producing machines just like you have your microchip, there are
    machines on it instead of inactive things, and they are so
    small, one-tenth of a hair, a hundredth of a hair, and they
    could end up being put in your blood system, and they could
    attack things like the plaque that makes heart conditions and
    the like. Actually, engineers designed them with micro-
    equipment just like you would design a----
        Dr. Krebs. It is very exciting.

                        spallation neutron source [sns]

        Senator Domenici. It is kind of interesting. Are you
    satisfied that when we go to the House and say we want to
    continue the Spallation Neutron Source at Oak Ridge that we are
    going to have enough information within the next month or so
    showing that we have taken care of most of GAO's concerns?
        Dr. Krebs. I do believe that, yes, sir.
        Senator Domenici. I would appreciate your making a note
    that as soon as you have the project in a position where you
    can clearly state we are on course with an appropriate
    management team and it should be built pursuant to specs, and
    if the specs are right, it will work, we would like to have
    that from you.
        Dr. Krebs. I think I can have the first installment of that
    to you on Thursday, with the report from the--the recent report
    that is coming out tomorrow.
        Senator Domenici. If there is a subsequent installment,
    would you get that to us as a matter of course, get it to our
    subcommittee?
        Dr. Krebs. Yes, sir.
        [The information follows:]

      Spallation Neutron Source Project Assessment Report and Action Plan

                               executive summary
        The Spallation Neutron Source (SNS) is a $1.36 B project to build
    what will be the world's most powerful research facility for neutron
    science. As a seven-year construction project supported by the
    Department of Energy (DOE), the SNS is now in its first year of
    congressionally approved line-item funding. In January 1999, the DOE
    reviewed the project's status and recommended that experienced project
    leadership be recruited to strengthen project performance. With the
    support of the DOE and the five national laboratories \1\ participating
    in the project, the new SNS leadership has conducted a thorough project
    assessment and developed a comprehensive course of action for
    completing the project safely, on budget, and on schedule.
    ---------------------------------------------------------------------------
        \1\ The preferred site for the SNS is at Oak Ridge National
    Laboratory (ORAL) and essential technical expertise is being provided
    by Argonne National Laboratory (ANL), Brookhaven National Laboratory
    (BNL), Lawrence Berkeley National Laboratory (LBNL), and Los Alamos
    National Laboratory (LANL).
    ---------------------------------------------------------------------------
        The assessment determined that many qualified people and adequate
    management systems are in place throughout the partner laboratories to
    support the current R&D activities of the project. The present
    accelerator concept is sound, uses existing, low-risk technology, and
    is highly likely to achieve the desired performance and reliability.
    High-quality technical work is ongoing. Planning for safe execution of
    the project within the Integrated Safety Management systems of all the
    partner laboratories is advanced. The final Environmental Impact
    Statement has been submitted to DOE and approved, and the Record of
    Decision is expected in May.
        As the project enters the Title I design phase, the primary needs
    identified by the project assessment are to recruit additional
    experienced staff for key positions, optimize and fully integrate the
    technical design, and strengthen the business and project management
    systems to support construction activities. Through prompt
    implementation of the management action plan developed from the
    assessment, the project will establish within the next six months or
    sooner:
        1. An integrated SNS organization with experienced people in key
    roles, fully engaging the expertise available from the partner
    laboratories;
        2. An optimized project baseline, with adequate contingency, that
    delivers maximum scientific output within the $1.36 B budget;
        3. Strengthened Memoranda of Agreement (MOA) that formalize
    accountability for deliverables, ensure project authority over all
    project personnel at partner labs, and cap overhead rates; and
        4. Fully integrated and efficient project and business management
    systems to plan, track and expedite work accomplishment, and
    effectively control the project.
        Completion of the action plan will position the SNS to be
    constructed safely and within budget by fiscal year 2006. In full
    operation the SNS facility will meet or exceed its performance goals
    and deliver pulsed neutron beams of unprecedented power and reliability
    to a world-class instrument suite.
                                  introduction
        For 30 years there has not been a major new neutron source
    commissioned in the United States. This situation has led to a serious
    decline in the competitiveness of U.S. researchers compared to their
    European and Japanese colleagues. Lacking new opportunities, successive
    generations of young neutron scientists have migrated into other fields
    of research, significantly depleting the strength of an enterprise in
    which North America played the seminal role as recognized by the 1994
    Nobel Prize in Physics. Although decline within the U.S. neutron
    research community has occurred, global neutron research has expanded
    its unique role in determining the structure of critical materials,
    especially complex magnetic and organic substances which are essential
    to our high-technology economy. Given the growing age of existing U.S.
    facilities and the compelling scientific importance of neutrons, the
    construction of a leading-edge neutron research facility has become an
    urgent national priority.
        The U.S. neutron research community has now focused on
    reestablishing world leadership in this critical field by building the
    Spallation Neutron Source at the preferred site of ORNL. Using advanced
    accelerator technology, and at a cost of $1.36 B, this source will be
    ten times more powerful than any existing facility worldwide when it is
    completed in fiscal year 2006. Including new-generation neutron-source
    technology and instrument design, the SNS will extend its scientific
    advantage to an even greater level. Success in achieving these
    challenging technical goals can only be accomplished through exemplary
    cost, schedule, and safety performance.
        The DOE regularly reviews its major construction projects using a
    comprehensive approach that has an outstanding reputation for depth and
    integrity. During January 26-28, 1999, the DOE conducted such a review
    of the SNS project, which has its first year of construction line-item
    funding. The purpose of this review was to validate the projects
    proposed Level 1 (Office of Science) cost, schedule, and technical
    baseline. The review determined that the project planning was not
    sufficiently mature to support the validation of the necessary baseline
    and recommended that experienced project leadership be recruited to
    ensure the project could be executed successfully. In early March, Dr.
    David Moncton--previously the leader of the recently successful
    Advanced Photon Source project--was appointed. With the support of DOE
    (Appendix A) and the five DOE laboratories participating in the
    project, he has attracted other experienced managers, enlisted
    independent specialists, and conducted a rapid assessment of every
    aspect of the project to determine the assets, status, and the course
    of action necessary to establish the baseline and complete the project
    successfully. Part of this assessment considered whether the project's
    scope was optimized to provide the greatest capability for neutron
    science that could be obtained within the budget of $1.36 B.
        Informed by this assessment, DOE review reports, and its collective
    experience with major scientific projects, the new SNS leadership
    developed the action plan summarized in Section 4 below. This plan
    contains the actions, milestones, and strategies needed for the balance
    of fiscal year 1999 to position the SNS for success in meeting its
    performance objectives.
        The SNS project has a great deal of work to accomplish in a short
    period of time. But there exists within the DOE system, and available
    to the project through the five-lab collaboration, expertise sufficient
    to achieve all the long-range goals of the project and build a facility
    that will revolutionize neutron scattering worldwide. This facility
    will reestablish the U.S. as the premier center for neutron research,
    and its safe construction, on schedule and within budget, will clearly
    demonstrate the commitment and the capacity of the DOE national
    laboratories to achieve world-class management and scientific
    performance.
                    project vision and management principles
        The key element in the SNS project planning is the formation of an
    effective multi-laboratory partnership to insure that the best
    scientists/engineers and the optimum technology are employed in the
    design and construction phases with followed by successful
    commissioning and operation. To execute this project effectively, the
    participating laboratories must share a common vision for the facility
    and embrace an active management approach that transcends institutional
    boundaries. Underlying both of these elements must be a strong
    commitment to attract and support people who are highly qualified in
    every aspect of technical and management responsibility.
    Vision
        By the year 2006, the SNS will have been completed safely, within
    cost and on schedule by the multi-laboratory partnership. It will be
    positioned to meet or exceed its performance goals within the ensuing
    few years, delivering pulsed neutron beams of unprecedented power
    reliably to instruments with highly advanced designs. Through their
    involvement in these developments, an expanded user community will
    advance the frontiers of knowledge in a broad range of scientific
    fields.
        In these accomplishments, the partner laboratories will have met or
    exceeded their individual goals and enhanced their reputations in areas
    important to their own competencies. But more importantly the people
    involved will have achieved something that none of them alone could
    have done--turning this vision into a reality that will transform many
    fields of science for decades to come.
    Management Principles
        Environment, safety and health.--Of overriding importance is the
    safety of our people and the protection of the environment. It is our
    philosophy that accidents and injuries can be prevented, that we must
    rigorously adhere to relevant safety and environmental standards, and
    that no individual working for the SNS project should feel compelled to
    do work he/she believes is not safe. Managers and workers share this
    responsibility, and all must work to continuously improve our
    collective performance.
        High-quality people.--Our next most important principle is that
    optimum results will be achieved on this complex project by the best
    people working in a collaborative and supportive environment.
        Integrated, cross-laboratory teamwork.--A major challenge in this
    project is to manage effective collaboration among the participating
    laboratories. We will need to establish explicit mechanisms to overcome
    institutional, geographic, and communication barriers and build an
    integrated SNS team.
        Project-based thinking to deliver on time and within budget.--It is
    essential to recognize that the SNS is first a major construction
    project with specific deliverables and a firm cost and schedule. A key
    principle for a project of this magnitude and technical complexity is
    the need to optimize globally--that is, over the entire project--rather
    than locally. For every project element, the temptation must be avoided
    to optimize local technology, budget or schedule, whenever doing so
    would not benefit the project overall.
        Active management and clear communication.--Management has a
    fundamental responsibility to make and communicate decisions in an open
    and logical manner, while achieving the highest possible degree of
    consensus. It is essential that project employees and managers respect
    and trust one another, and that the management team act in a way that
    is deserving of that trust.
    Collaboration Management
        The most fundamental issue in collaboration management is the
    nature of the ``contract'' between ORNL as the lead lab and the other
    partner laboratories. Because ORNL has the ultimate responsibility for
    delivering the SNS project and operating the completed facility, it is
    imperative that ORNL provide credible technical and project leadership
    on behalf of the collaboration. It is incumbent on ORNL to delegate
    appropriate authority to the partner labs for execution of their work
    consistent with their demonstrated performance and the terms of the
    Memoranda of Agreement. It is equally important that ORNL have full
    ability to track and appropriately manage SNS activities at the partner
    labs. In implementing this trust-but-verify approach, it is desirable
    to have maximally transparent boundaries between the partner labs,
    thereby creating an integrated project team with accountability and
    communication as clear as if the project were executed in the
    traditional single-lab approach.
                                  action plan
        Planned actions developed by the new SNS leadership are grouped
    within six principal categories and are summarized below.
    People and Organization
        The Project Office will be reorganized by July to establish clear
    responsibility for each technical and administrative area and increase
    the number of project-experienced managers (Fig. 1). An accelerator
    technical staff (led by an experienced Accelerator Systems Division
    Director) will be promptly established at ORNL to lead integration and
    review of component and system designs, prepare for facility
    operations, and guide procurement, fabrication, installation, testing
    and commissioning strategies. An integrated project human resources
    plan will be developed (in phases and completed by October) to guide
    the hiring process. Key staffing needs identified during this project
    assessment will be filled as soon as possible with qualified and
    experienced individuals. The HR plan will include policies and
    mechanisms for ensuring project input into performance appraisals for
    people performing SNS work, position description requirements, staffing
    levels, and strategies to ensure that broad diversity in talent is
    achieved.
    [GRAPHIC] [TIFF OMITTED] T10AP13.007

    Technical Concept
        By August 1999, a plan for SNS instrumentation will be developed
    that reflects the need for best-in-class instruments, involves the user
    community, capitalizes on the capabilities of the federally-funded
    laboratories with substantial neutron science experience, and includes
    ongoing instrument development. This plan will propose mechanisms and
    incentives for investment by potential investors, a strategy for
    engaging the scientific community early in the project, and user access
    policies tailored to the needs of the neutron scattering community in
    the U.S. A series of workshops aimed at outreach to new user
    communities (e.g., the biological/biomedical community) will be
    launched. Also, by August 1999, a staffing plan for operations, ongoing
    instrument development, and on-site user activities and support will be
    developed to optimize the design of the conventional facilities. An R&D
    program on a backup solid target will be initiated now.
        The present linac/accumulator ring (LAR) concept will be optimized
    for 2-MW operation by May 1999 and its detailed cost estimate will be
    reviewed and scrubbed by the project management in June. This process
    will strive to identify available funds to increase project contingency
    and to provide additional instruments, targets, and office/laboratory
    space. This 2-MW LAR design will be reviewed by the Accelerator Systems
    Advisory Committee and proposed as the project baseline to DOE in mid-
    July. In parallel, a study will be started immediately (provided
    sufficient resources can be identified) to explore modified accelerator
    designs by June. If modifications are shown to have substantial cost
    advantages with no loss of performance or negative impact on the
    project's long-range schedule, then their designs, cost estimates, and
    schedules will be developed by October 1999 and adopted through the
    project's formal change control process.
    Conventional Facilities and Site
        Full geotechnical qualification of the preferred ORNL site will be
    pursued aggressively. Innovative technology and a site drilling plan
    will be employed, and the three-season surveys for threatened species
    and endangered plants will be completed by the end of calendar year
    1999. Facilities programming will be initiated now to ensure that
    adequate requirements to support researchers and operations staff are
    identified in the design. Systems requirements documents for all
    facilities will be completed, and the design requirements and site plan
    of the Joint Institute for Neutron Science will be reviewed with the
    University of Tennessee to ensure that the SNS site plan and programmed
    space needs are optimized. Based on the actions above, the final SNS
    site qualification will be completed by September 1999.
    Project Management
        The Memorandum of Agreement with each partner laboratory will be
    revised by May 1999 to formalize each laboratory's accountability for
    deliverables, strengthen the authority of the Project Director over
    SNS-assigned personnel at each location, and cap overhead rates applied
    to SNS activities for the duration of the project. The role of the
    project Upper Management Council will be developed to provide
    additional and regular advice and assistance with strategic
    collaboration management issues.
    Environment, Safety and Health, and Quality Assurance
        A focused effort on target radiological issues in the preliminary
    safety analysis report (PSAR) will be instituted now to support a
    project decision in June 1999 on target hazard classification and
    potential mitigation proposals. Completion of the draft PSAR will be
    expedited to the first quarter of fiscal year 2000. The project ES&H
    group will issue a draft plan by July 1999 to establish appropriate
    project-wide ES&H standards for engineering design. A quality assurance
    (QA) approach will be developed and a tailored QA plan will be approved
    by September 1999. To facilitate development of this plan and enhance
    cross-project teamwork, a workshop including QA specialists and
    technical managers will be conducted.
    Business Systems
        A number of actions are planned to improve the project's management
    support systems, including human resources, finance and accounting, and
    procurement.
        With DOE assistance, policies and plans to better facilitate
    recruitment of experienced personnel will be established to provide
    continuity of service benefits when hiring between DOE laboratories.
    Relocation and family assistance to address recruiting concerns at ORNL
    (including transfer of ORNL personnel hired at partner laboratories)
    will be procured. Routine use of videoconferencing capability available
    to SNS project teams at all partner labs will be implemented by July
    1999 to reduce travel costs and enhance communications.
        By October 1999, methods to automate the integration of financial
    and cost performance reporting system information with project
    schedules will be in place, reducing the manual effort currently
    required to reconcile these data and to provide improved contingency
    control. The project office will conduct a detailed analysis of
    overhead rates at all partner laboratories and verify cost estimates
    during the June cost estimate scrub. This action will support the
    establishment of long-term capped overhead rates as reflected in the
    strengthened MOA. An SNS project financial audit plan will be
    formalized by October 1999, to include plans for regular financial
    reviews and guidance for audit activity at partner laboratories.
        A project-wide procurement strategy will be developed by July; this
    strategy will include advanced procurement planning, guidance for
    acquisition decisions, reporting requirements and formats, approval
    levels, and buyer/technical staff roles and responsibilities. A
    workshop led by ORNL project procurement will be scheduled to help
    develop this strategy, build teamwork, and resolve inefficiencies
    resulting from constraints on procurement organizations in the partner
    laboratories. Based on the project procurement strategy, the
    procurement workload and resulting staffing plan will be developed and
    in place by October 1999.
                                  conclusions
        This assessment report and action plan addresses the SNS project's
    organization, technical, and scientific capability, site qualification,
    project management systems, business systems, and human resources. The
    plan focuses on establishing by July 1999:
        1. An integrated SNS organization with experienced key staff in
    place that takes advantage of the capabilities at the partner
    laboratories, while building at ORNL the technical and administrative
    strength to lead the construction effort and operate the completed SNS
    user facility for world-class scientific research;
        2. A validated, self-consistent, and optimized technical, cost, and
    schedule baseline with adequate cost and schedule contingency and
    maximized neutron-science capability within the $1.36 B budget;
        3. Strengthened interlaboratory MOA that formalize accountability
    for deliverables, ensure project authority over all project personnel,
    and cap overhead rates for the life of the project.
        Major objectives to be achieved by October 1999 include:
        4. To complete the geotechnical analysis of the preferred site at
    ORNL to determine that it is acceptable;
        5. To establish a firm hazard category for the target facilities to
    allow optimal design and planning to proceed and ultimately to allow
    safe and cost effective operation;
        6. To implement fully integrated and efficient project management
    systems to plan, track, and expedite work accomplishment, and
    effectively control the project; and
        7. To establish financial, procurement, human resource, and related
    business systems that are tailored to project needs and linked to the
    project management databases.
        The assessment determined that many qualified personnel and
    management systems adequate for the R&D phase are in place throughout
    the partner laboratories. High-quality technical work is ongoing.
    Planning for safe execution of the project within the Integrated Safety
    Management systems of all the laboratories is advanced. The final
    Environmental Impact Statement has been submitted to DOE for approval
    and the Record of Decision is expected in May. The primary project
    needs are to significantly upgrade the capabilities and systems of the
    central project office during the design phase, and to fully optimize
    and integrate the design for construction and operation.
        Project management, reporting, business, and human resource systems
    will also be tailored to execute the project in the multilaboratory
    environment. These systems will become fully mature by October 1999.
    The critically important task of developing a staffing plan and
    attracting highly qualified personnel will proceed concurrently. The
    Upper Management Council, consisting of one senior line manager
    appointed by each partner laboratory director, will be convened on a
    regular basis to assist project management and help refine the
    collaboration management approach. Successful completion of the
    described action plan will position the SNS to be completed safely by
    the multilaboratory partnership within budget and on schedule.

                            DOE Letter of Agreement

                                          Department of Energy,
                                     Washington, DC, February 19, 1999.
    Dr. David Moncton,
    Associate Laboratory Director for the Advanced Photon Source,
    Argonne National Laboratory, Argonne, IL.
        Dear David: Al Trivelpiece told us that the five laboratory
    directors responsible for the construction of the SNS met and that you
    were their enthusiastic and unanimous choice to lead the SNS project. I
    was very pleased to learn that you are seriously considering this
    position and that you already have agreed to undertake a personal
    review of the project. I understand and support your need to review all
    aspects of the project and to discuss your findings and recommendations
    with both the DOE and the five laboratory collaboration.
        We have agreed that you will assemble a Senior Management Team from
    both within and outside the present SNS project. The Senior Management
    Team will conduct a comprehensive month-long asset assessment using a
    set of teams composed of outside experts and internal asset owners.
    Under review will be, among others things, financial resources, human
    resources, project management systems, business management systems,
    physical assets, and the site itself. Importantly, we have agreed that
    your assessment will include the reference design and its associated
    costs and schedules. You will prepare a Project Plan containing
    findings and recommendations by the first week in April and will
    present this plan to DOE, the directors of the SNS partner
    laboratories, and the several SNS advisory committees immediately
    thereafter. A longer-term goal is to have the project ready for a Level
    1 baseline review by July 1999.
        I want to assure you that DOE is open to accepting a wide range of
    recommendations subject only to a very few constraints, which we have
    already discussed. These constraints are the following. (1) The Level 0
    Baselines (cost, scope, and schedule) approved by Secretary Pena in
    December, 1997, and modified only as a result of the fiscal year 1999
    appropriation must be maintained; within the TPC, there must be an
    adequate contingency. (2) The SNS project must continue as a five-
    laboratory collaboration with ORNL as the preferred site. (3) In accord
    with the recommendations of the Basic Energy Sciences Advisory
    Committee (BESAC) regarding the technical specifications of the SNS,
    the design must be sufficiently flexible so that the SNS can be
    operated at a significantly higher power in a later stage. Furthermore,
    the upgrade path must minimize downtime for the users. (4) Finally, it
    is very important that the design maximize scientific capability
    through a large and robust initial suite of instruments and through
    other accommodations to the needs of the neutron science user
    community.
        Other recommendations of BESAC were that the design rely on low-
    risk technology initially, the linear accelerator design not exclude
    direct injection of long pulses into a spallation target, and the
    source have a predictability and reliability as set forth in the Kohn
    report and be capable of operating at least 240 days annually. You
    should consider these recommendations as you undertake your assessment
    of the project.
        We have also agreed to work with you and the Laboratory to
    accommodate needs related to recruitment and retention incentives for
    the SNS senior management team and other issues. Please let me know if
    there is anything that I can do to expedite your review. I look forward
    to your presentation to me and to the Office of Basic Energy Sciences.
    Again, I want to sincerely welcome you into the SNS collaboration and
    offer my full support and help during the coming weeks.
                Sincerely,
                                               Martha A. Krebs,
                                           Director, Office of Science.

        Senator Domenici. I do not want to burden the record on it,
    but I just want to say it concerns me greatly that we are in
    this position, and it should concern you, concern the
    Department of Energy. The Department of Energy does not have
    the greatest record of getting these kind of major projects
    through completion. I do not care to use statistics, but that
    record is not very good. I would hope that this Spallation
    Neutron Source machine, which everybody thinks is a great tool
    for science, that we do not mess it up in terms of managing its
    construction and early operation.
        Dr. Krebs. I have a great concern for it, too. I consider
    this project to be a critical element of the Department's role
    and the Office of Science's role as a provider of major unique
    scientific user facilities. We have paid a lot of attention to
    the management of the project.
        The difficulties that were discovered were discovered by
    our process, which is an extremely open one, and we took very
    strong, prompt action, and we will continue to do that as the
    project goes along.

                               employment levels

        Senator Domenici. The Office of Science, which you head,
    has one of the lowest ratios of program direction funds to
    program funds. In other words, your office uses very few
    Federal employees to oversee a great deal of research funds.
    Are you able to attract and retain sufficient employees to do
    this kind of work, and/or do you have authority to go outside
    and contract for them?
        Dr. Krebs. This is a hard question to answer. We have some
    very dedicated, extraordinarily bright, committed people who
    work for the Office of Science. About 50 percent of them are
    eligible for retirement, so I have been able to keep them on
    board, because they care a great deal about the programs that
    we support.
        Our headquarter's FTE number has gone down in the last 5
    years from 380 to about 270. So as I look forward in the next 2
    to 5 years, I think the ability to attract, retain, and
    compensate the kind of people we have now is a big concern for
    me.
        Senator Domenici. Are you starting to plan now?
        Dr. Krebs. Sir, the Secretary has engaged in a Workforce-21
    planning exercise, by which he has reviewed the commitments
    that the Department made, I guess now 3 or 4 years ago, I
    cannot remember, and there are adjustments being made, so we
    will be able within the next year to begin to address some of
    these issues.
        Mr. Reicher. Mr. Chairman, if I could make a brief comment.
        Senator Domenici. Please.
        Mr. Reicher. In line with what Dr. Krebs said, under
    Workforce-21 Secretary Richardson has recognized that under the
    Strategic Alignment Initiative, which brought down the FTE
    levels in the Department substantially, we do now face a
    situation where there are some specific technical and other
    personnel needed in the Federal ranks to run our programs. In
    the case of my office, our staff, our Federal staff, is down
    somewhere on the order of 27 percent in the last few years, and
    our budget is up somewhat.
        What we found is that we do not have, in fact, adequate
    federal staff to administer the taxpayers' dollars as well as
    we think we need to, and so part of Workforce-21 is designed to
    address some of those disconnects in the staffing of the
    Department of Energy and a variety of offices. I think all are
    hopeful that in your consideration of the various budget
    requests that these targeted increases in Federal staffing
    would be supported. Thank you.
        Senator Domenici. Thank you. Thanks to both of you. I
    wonder if Workforce-21 also reviews the areas where we are not
    short to see if there is an excess elsewhere.
        Dr. Krebs. I think it looked across all of the
    organizations in the Department, and I cannot tell you whether
    they shifted from one to the other. I do not know that.
        Senator Domenici. Well, we get a constant barrage of
    inquiries about whether or not the OE, in skinning down,
    because of budget restraints, has more people in Washington
    than they need and reduced forces elsewhere, they reduce jobs
    elsewhere. I do not know the answer to that, but----
        Dr. Krebs. May I make a comment?
        Senator Domenici [continuing]. I am concerned that we have
    such a shortage in these areas, and we have to do some
    planning, especially in the one you described, about 50 percent
    being ready to retire. I mean you need corporate memory, but
    you need to have some talented people.
        Dr. Krebs. May I make a comment?
        Senator Domenici. Sure.

                                field structure

        Dr. Krebs. I think that it is important to distinguish the
    way different programs at the Department of Energy use the
    field structure. The Environmental Management Program, for
    example, really operates very strongly in the field and manages
    their programs in the field.
        For a program like the Office of Science, where we reach
    across so many different disciplines in the scientific
    community, it is very difficult to reproduce that capability in
    the field, so that the planning, program execution and
    oversight in large measure stays at headquarters rather than
    being--and some contract management, some project management
    for big facilities like the Spallation Source does take place
    in the field, and so we have a different balance than, for
    example, the Environmental Management Program might have. The
    Office of Energy Efficiency and Renewables, or our Nuclear
    Energy, might be similar in that regard.
        Senator Domenici. Do you wish to comment on that, Mr.
    Reicher?
        Mr. Reicher. Yes. We have a mix of both R&D like the Office
    of Science, and then some deployment-oriented programs, so what
    we are focused on is ensuring we have the core capability at
    headquarters to manage the cross-cutting R&D, but then we also
    have important Federal workers in the field in six different
    cities who help us with the deployment of these technologies.
        So striking that balance has been a part of the Workforce-
    21, and I would also add the Secretary's review of the whole
    field structure.
        Senator Domenici. Mr. Magwood, I would assume your portion
    of the Department got so small that you must have a problem
    that everybody is new.
        Mr. Magwood. I think that our situation is similar to Dr.
    Krebs'. In fact, our outlook for retirement is worse than the
    Office of Science. We have one of the older offices in the
    Department, and we have already lost a great deal of important
    talent, partially because of the need to downsize to meet the
    strategic alignment initiatives, but also, quite frankly,
    because there is some exacerbation on the part of some of the
    professionals in Nuclear Energy about the direction of the
    program over the last few years.
        We have reversed that, and a lot of people we think are
    going to hang on for a while. I really am focused now on trying
    to bring some younger people into our office to make sure that
    the expertise we have can perpetuate into the future. We are
    very pleased with the outcome of the Workforce-21 initiative,
    and our program direction request reflects our expectations
    there.

                          low dose radiation research

        Senator Domenici. Dr. Krebs, everywhere we look in terms of
    nuclear waste disposal, any area where we have a potential for
    low-level radiation, we are confronted with the fact that
    almost everybody tells us that we do not know the effects
    properly, and that most of them say we overstated the effect of
    low-level radiation.
        We have finally come to a point at which I am very pleased
    to be part of, where Congress provided $12 million for a
    research program to try to help us understand the health
    effects of low-level ionizing radiation, that is, whether there
    is at very low levels a linear relationship between radiation
    exposure and cancer, which we have all, based on one major
    study, accepted the linear relationship, and even a non-
    scientist can look at an explanation of it and have some real
    wonder about whether it truly is scientifically extendable, as
    it has been.
        I understand that in response to that money you have put
    out solicitations for a $7 million proposal, and that you
    received $60 million or $70 million worth of applications.
        Dr. Krebs. Correct.
        Senator Domenici. Are they good institutions and
    partnerships that want to do this research? Are they among the
    best in the country?
        Dr. Krebs. Yes. I think they range across all of our
    laboratories and all of the major research universities, so we
    think that we will be able to run an external peer review
    process that will assure that we have the best and the most
    relevant research to the program plan, within the program plan.
        Senator Domenici. Do you share my enthusiasm that the
    country ought to get this done?
        Dr. Krebs. I think that this is a particularly opportune
    time for the scientific community to take another look at this
    problem. Given the tools that we have developed within the
    genome program, and since the damage that occurs, that induces
    any kind of radiation response arises first at the genetic and
    genomic level, we now have the tools so that we can take a look
    at it, so it is a particularly appropriate time.
        Senator Domenici. Now, the biological and environmental
    research advisory committee has helped you develop the research
    plan for this effort, is that right?
        Dr. Krebs. Correct, sir. I requested last year that they
    provide a plan, they have submitted it. I believe that it has
    been shared with you.
        Senator Domenici. Does your budget for 2000 fully fund the
    program set out by the advisory committee.
        Dr. Krebs. It does not, sir, as far as I understand.
        Senator Domenici. How much are you short?
        Dr. Krebs. I would have to provide you, for the record, but
    my understanding is that we have $10 million in the budget, and
    to completely take advantage of all the opportunities that the
    scientific community has identified would take more than $20
    million.
        [The information follows:]

                      Low Dose Radiation Research Program

        Senate Report 105-206 dated June 5, 1998, directed the Biological
    and Environmental Research (BER) program to provide the Senate Energy
    and Water Subcommittee of the Senate Appropriations Committee a draft
    plan for the Low Dose Radiation Research Program. A draft program plan
    called for the program to spend $3 million in fiscal year 1998, $5
    million in Fiscal year 1999, and $10 million per year in fiscal year
    2000-2007. The fiscal year 1999 Energy and Water Development
    Appropriation provided $8 million for this program ($3 million in the
    BER budget and $5 million in the budget for Environmental Management),
    for a total of $13 million in fiscal year 1999, and called for the
    development of a long range program plan. The Biological and
    Environmental Research Advisory Committee (BERAC) prepared a program
    plan that was delivered to Congress in March 1999. This plan called for
    $22.4 million in fiscal year 2000, in contrast to the fiscal year 2000
    request of $10 million.

        Senator Domenici. More than what?
        Dr. Krebs. $20 million.
        Senator Domenici. Okay. We thought it was about $22
    million, is that about right?
        Dr. Krebs. Yes.
        Senator Domenici. The reason I ask and the reason I will be
    concerned about documentation and what the advisory group said
    is because I do not think you want to do one of these and not
    get it right. You must do the peer review, you have to get the
    right answer so that when we are finished we do not have
    everybody that is anti-nuclear questioning the results. They
    will anyway, therefore, it is critical that we be
    scientifically sound.
        Dr. Krebs. You want to do the right science----
        Senator Domenici. You have it.
        Dr. Krebs [continuing]. The fastest way.

                             high flux beam reactor

        Senator Domenici. Can we talk a minute about the High-Flux
    Beam Reactor?
        Dr. Krebs. Certainly.
        Senator Domenici. The Department intends to decide in June
    whether to re-start the High-Flux Beam Reactor at Brookhaven.
    Would your request provide sufficient funds to re-start the
    reactor or shut it down, depending on the decision?
        Dr. Krebs. Let me provide that for the record. Right now,
    we are about to release in late May or early June the draft
    environmental impact statement for the future of the high-flux
    beam reactor. We can release that draft without a preferred
    alternative.
        If we release the draft that way, then when the final
    report is released come next November or December that would be
    the time when we would have to finally determine a preferred
    alternative.
        The Secretary has indicated that he is willing to consider
    an early decision, but we have not engaged him in the review of
    the issues that would lead to that decision that might lead us
    to have a preferred alternative with the draft. If the decision
    were to restart, we would still have a considerable amount of
    activity to undertake to prepare for actually turning on the
    reactor.
        If the decision were to shut down, we would still need,
    again, approximately the same amount of funding that is in our
    2000 budget request to prepare the facility for a safe
    shutdown. A decision, even an early decision to restart, would
    require some 16 months before we could expect the facility to
    operate again, and the funding in a shutdown case does not
    account for any of the decommissioning and decontamination
    costs.
        [The information follows:]

                         High Flux Beam Reactor Funding

        Yes, the fiscal year 2000 funding request for the High Flux Beam
    Reactor is adequate for restart or shutdown activities.
        During the first quarter of fiscal year 2000, before completion of
    the Environmental Impact Statement (EIS) and the associated Record of
    Decision, activities that are common to all of the EIS alternatives
    will continue. These activities are part of the High Flux Beam Reactor
    (HFBR) Transition Project initiated in 1998. These include the canal
    liner, as well as the seismic upgrades to the operations level crane
    and the control room, the repiping of the stack drains, the
    installation of Suffolk County Article 12 leak detection
    instrumentation, and the Safety Analysis Report (SAR) update
    implementation.
        If the DOE decision is to restart the reactor, restart related
    activities will start when DOE authorization is given. It will take
    about 16 months from the time the decision is made to restart for the
    reactor to start operations. These activities include, the secondary
    water basin, piping, and isolation valve upgrade, canal internals
    fabrication, SAR implementation of corrective actions, Operational
    Readiness Review implementation, and hiring and training of personnel.
        If the DOE decision is to shut down HFBR, activities will start to
    place HFBR in safe shutdown. These activities include draining and
    removal of all radioactive fluids and removal of activated components
    in the pressure vessel. These activities will continue throughout
    fiscal year 2000.

                            bates laboratory funding

        Senator Domenici. Let me just talk a minute about the MIT
    Bates facility. Your budget request includes no funding for the
    continued operation of that facility at MIT.
        Dr. Krebs. Correct.
        Senator Domenici. After the submission of the request I
    understand Secretary Richardson committed to submit a budget
    amendment to provide some continued funding for the Bates
    facility. Can you tell us when we will receive that amendment,
    and what you would propose to do at MIT next year?
        Dr. Krebs. My best understanding at this moment is that an
    amendment was cleared by OMB last night. The details of how
    that facility will operate in fiscal year 2000 I will have to
    provide you for the record. But it would be our intention to
    complete the BLAST detector and to operate the facility through
    the year 2004, to complete the science that can be obtained
    from BLAST. We may be able to operate another detector as well,
    but we need to look at that carefully.
        Senator Domenici. From where are you going to get the
    money? Have you decided that yet?
        Dr. Krebs. Well, I think that is in the budget amendment,
    sir.
        Senator Domenici. Oh, good. We will be interested in it. It
    seems to me that this facility, I have great respect for MIT,
    it seems like it just cannot die. It must have some very
    excellent supporters somewhere. Do you have any idea whom they
    might be?
        Dr. Krebs. Well, sir, what I can tell you--certain kinds of
    support you probably know better than I, but in terms of
    scientific support, I can tell you that last year we asked the
    Nuclear Science Advisory Committee to review the medium energy
    physics program, and they came in very high on the Bates
    facility.
        So to the extent that the Administration has been able to
    find additional funding for this project, it is a good thing to
    do.
        Senator Domenici. That would not be the only scientific
    facility around that there would be great science support for,
    would it? I think that probably you and I could come up with 50
    or 60 before this hearing is over.
        Dr. Krebs. I am sure you could.
        Senator Domenici. In any event, the Secretary made a nice
    turnaround there, and he is entitled to make a few changes,
    just so he cuts the right programs to pay for it. It would be
    all right with me.
        [The information follows:]

                                Nuclear Physics

        The budget amendment will provide sufficient funding to maintain
    support of the staff, operate the accelerator for research, fabricate
    the Bates Large Acceptance Spectrometer Toroid detector (BLAST), and
    develop the capabilities to carry out a research program using BLAST
    when it is completed.
        The Bates Laboratory will operate 2000 hours for research during
    fiscal year 2000. This time will primarily be used to pursue new
    investigations using the recently completed Out-of-Plane Spectrometer
    System (OOPS). OOPS fabrication has been supported by the National
    Science Foundation and the Department of Energy. The OOPS system will
    be used with continuous wave (cw) beams extracted from the new South
    Hall Pulse Stretcher Ring.
        Fabrication of the BLAST detector will continue. BLAST will utilize
    the very high current, cw, polarized electron beams which circulate in
    the new Pulse Stretcher Ring.
        Upon completion of BLAST in fiscal year 2001, the Bates scientific
    program will shift primarily to BLAST, and it is expected that a three-
    year program of research will be carried out with that new detector.
        At the end of fiscal year 2004, the Bates Laboratory will begin a
    planned termination of activities, reaching a Decommissioning and
    Decontamination (D&D) level of support in fiscal year 2006.
        MIT plans to provide additional support in fiscal year 2000 and
    fiscal year 2001 for enhanced research operations.

                      climate change technology initiative

        Senator Domenici. With reference to climate change
    technology initiative, I am trying to determine if the climate
    change technology initiative is a new effort or a relabeling of
    the current work. For example, within the geoscience budget,
    the core program would drop $6.9 million under your request,
    but the geoscience climate change technology initiative would
    go up 6.8. Is this new work, or simply relabeling the old
    program?
        Dr. Krebs. There is no question that within the Basic
    Energy Sciences Program and some parts of the Biological and
    Environmental Research Program the climate change technology
    initiative begun last year was essentially an extension and
    expansion of directions that were already being pursued, and it
    simply allowed us to engage more fully in opportunities that we
    had identified.
        This year, in order to accommodate the directions of the
    initiative, we had to make some hard decisions about the
    activities that were not necessarily so clearly connected.
        Senator Domenici. Unless any of you have some comments that
    have been provided by either answers or questions, we have
    completed this round. Yes, Mr. Reicher.
        Mr. Reicher. Just a quick follow-up, Mr. Chairman. On the
    climate change technology initiative, I wanted to echo what Dr.
    Krebs said, and that is that I think there has been something
    of a misunderstanding that the climate change initiative
    represents a whole new category of work, but, in fact, it is
    pulling together a whole host of activities that have been
    undertaken by the Department and other agencies for a long
    period of time that can address climate change as well as a
    host of other challenges we faced, and to that, or added some
    new activities, but the bulk of the work are solid existing
    programs that span all the energy technologies and efficiency
    work that we have been doing for a great deal of time.

                       accelerator transmutation of waste

        Mr. Magwood. Just one thing. I mentioned to you that we met
    with a large contingent from Japan to talk about cooperation,
    and one area that they were very interested in talking to us
    about was the accelerator transmutation of waste, a subject I
    know you are very familiar with.
        We are working closely with the Office of Civilian
    Radioactive Waste Management to move forward with the road map
    to study accelerator transmutation of waste. After listening to
    what the Japanese had to say, I think that there is a very
    significant opportunity to cooperate with them over the long
    term with this program, and we will be looking forward to doing
    that. I just wanted to let you know that that this activity is
    underway.
        Senator Domenici. Thank you very much. We are going to have
    questions that we will send to you that are from Senators Reid,
    Craig, and McConnell. Let us use the 2-week return that we had
    agreed upon with Senator Reid for all three.

                       potential programmic problem areas

        Let me ask each of you, with reference to the things you
    manage and things under your control, I will start with you,
    Dr. Krebs, is there any program activity, construction project,
    or the like, that is in trouble out there that you think a
    subcommittee ought to know about, and if something breaks at
    least we have been informed? It is sort of like asking the
    Corps of Engineers are your dams safe.
        We have given them money to make sure that they are and
    they report every dam is safe. We get surprised frequently on
    things that do not turn out exactly as we would like at the
    Department of Energy, and I am not referring to the spying or
    the espionage issue. Do you understand my question?
        Dr. Krebs. I think I do, sir. It is hard for me, when I
    think about having to answer this, knowing that, in fact, my
    colleagues in the scientific community come in to talk to you
    on, or talk to any number of people here in Washington on a
    regular basis, if you want me to tell you that they have all
    the money they think they need----
        Senator Domenici. Oh, no.
        Dr. Krebs [continuing]. They do not. If on the other hand
    you want to know that within this budget are we operating our
    facilities in an at least optimized way, I think I can say that
    we are. In terms of facilities that are under construction,
    there will be no surprises, because, again, our program reviews
    and our project reviews are very open, and you hear almost as
    soon as we do when there are difficulties, and right now,
    outside of the Spallation source, we anticipate no problems.
        Senator Domenici. You have a lot of nuclear reactors that
    you have responsibility for. Are any of them leaking?
        Dr. Krebs. One is shut down, namely, the High-Flux Beam
    Reactor, and the other is being upgraded, namely, the reactor
    at Oak Ridge.
        Senator Domenici. Are there any projects, major projects,
    that are running over the cost estimates?
        Dr. Krebs. It depends on how you count it, sir. GAO might
    say something differently than we would. But right now, we are
    wrapping up the B factory, the Relativistic Heavy Ion Collider,
    the Fermi Main Injector, and the Combustion Research Facility.
    To my knowledge, they are pretty much on schedule and on cost.
        Senator Domenici. Maybe what you ought to do for the
    record, and just consider this a question to be answered, maybe
    you ought to list all the major projects you have going on,
    what their estimated costs are, where we are in----
        Dr. Krebs. Yes, sir.
        Senator Domenici [continuing]. The construction phasing,
    and where the estimates are.
        Dr. Krebs. Okay.
        [The information follows:]

                                                  CONSTRUCTION PROJECTS
                                                [In thousands of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                                Total        Total
                                                                    Remaining                   Actual      Actual
      Title, Location and Project Number     TEC    Appropriation    Approp.     Estimated   Obligations   Costs to
                                                       To Date       Needed     Completion   to Date  (4/  Date  (4/
                                                                                                30/99)      30/99)
    ----------------------------------------------------------------------------------------------------------------
    ENERGY SUPPLY--NUCLEAR ENERGY:
        TRA LANDLORD:
            Fire and Life Safety            15,446        11,366        4,080  4th Qtr 2001       11,366       6,559
             Improvements Idaho
             Engineering And
             Environmental Laboratory
             Idaho 95-E-201..............
            Electrical Utility Upgrade       6,700           341        6,359  4th Qtr 2003          341          88
             Idaho Engineering And
             Environmental Laboratory
             Idaho 99-E-200..............
        ISOTOPE SUPPORT: Isotope            14,000         6,000        8,000  3rd Qtr 2001        6,000       1,069
         Production Facility, TA-53 Los
         Alamos, New Mexico 99-E-201.....
    ----------------------------------------------------------------------------------------------------------------

                                                                      CONSTRUCTION PROJECTS
                                                                    [In thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                        Total        Total
                                                                                                            Remaining                   Actual      Actual
                        Title, Location and Project Number                          TEC     Appropriation    Approp.     Estimated   Obligations   Costs to
                                                                                               To Date       Needed     Completion   to Date  (3/  Date  (3/
                                                                                                                                        31/99)      31/99)
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    BASIC ENERGY SCIENCES: Spallation Neutron Source: Oak Ridge National         1,159,500       101,400    1,058,100  1st Qtr 2006       32,835      18,448
     Laboratory Oak Ridge, Tennessee 99-E-334.................................
    HIGH ENERGY PHYSICS:
        Neutrinos at the Main Injector (NuMI) Fermi National Accelerator            76,200        19,800       56,400   2nd Qtr 200       19,800       3,548
         Laboratory Batavia, Illinois 98-G-304................................
        Wilson Hall Safety Improvements Fermi National Accelerator Laboratory       15,600         6,700        8,900  3rd Qtr 2002        6,700          93
         Batavia, Illinois 99-G-306...........................................
    --------------------------------------------------------------------------------------------------------------------------------------------------------

                                             OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY--CONSTRUCTION PROJECTS
                                                                    [In thousands of dollars]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    TEC ($000) \1\                                                      Total        Total
                                                                 -------------------                    Remaining                       Actual      Actual
                 Title, Location and Project Number                                  Appropriations  Appropriations     Estimated    Obligations   Costs to
                                                                    DOE      MNVaP       To Date         Needed      Completion \1\  to Date  (3/  Date  (3/
                                                                                                                                        31/99)      31/99)
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    Minnesota Alfalfa Project (MAP) Granite Falls, Minnesota DE-   49,821   182,179        11,040         ( \2\ )     1st Qtr 2001        11,040      10,354
     FC36-96GO10147.............................................
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Total Estimated Cost (TEC) and the estimated completion is the original estimated project cost and completion date for the project.
    \2\ Due to recent developments, Minnesota Valley Alfalfa Producers have requested the project be restructured as a co-firing project which will reduce
      the TEC by not requiring new construction. DOE participation and costs are yet to be determined.

                         Additional committee questions

        Senator Domenici. Does anybody else have any comments
    there? I think I will ask the same question of each of you.
    That last one should apply to each of you, if you would, and
    also when you leave during the next--in preparing the answers,
    if there is something you think the committee should know about
    that may not go exactly as planned, or there is evidence that
    it might not, I would appreciate you telling me about it in the
    answers that you give us.
        [The following questions were not asked at the hearing, but
    were submitted to the Department for response subsequent to the
    hearing:]

                    Questions Submitted by Senator McConnell

                         depleted uranium hexafluoride
        Question. How much appropriated funding has the Department
    requested for the maintenance of depleted uranium hexafluoride
    cylinders stored at Paducah, Portsmouth, and Oak Ridge. Specifically,
    how much has been allocated to each facility for fiscal year 2000?
        Answer. The Department requested fiscal year 2000 appropriations
    totaling $10.9 million for depleted uranium hexafluoride cylinder
    maintenance at the Paducah, Portsmouth, and Oak Ridge sites. Initial
    plans call for about $2.8 million to be allocated to Paducah, $2.7
    million to be allocated to Portsmouth, and about $3.7 million to be
    allocated to Oak Ridge. Approximately $1.2 million will be used in
    managing cylinder maintenance at the three sites in an integrated
    manner. Lastly, about $0.5 million will be used to perform engineering
    development type work necessary to sustain, optimize and enhance the
    cylinder storage system. In addition, the Department will apply funds
    obtained under the Memoranda of Agreement with USEC to conduct cylinder
    maintenance activities and to build storage yards associated with
    accepting USEC-generated DUF6 cylinders.
        Question. The Department of Energy entered into two Memoranda of
    Agreement with USEC totaling $66 million for the management of
    cylinders transferred from USEC to DOE. How will this money be spent
    and will any of the MOA funds duplicate already appropriated funds or
    requested funds?
        Answer. The Memoranda of Agreement (MOA) funding will not duplicate
    already appropriated funding or requested funding. The Department
    projects the $66 million will be utilized over the fiscal year 1999
    through fiscal year 2009 time frame for cylinder maintenance, yard
    construction, conversion facility preparations, and required near-term
    activities as shown on the attached table. Approximately $24 million of
    the $66 million has been earmarked for additional conversion
    preparation, and required near-term activities with specific yearly
    funding levels predicated upon the Department's evaluation of the
    private sector response to the Expression of Interest (EOI) and the
    need to support the Department's rapid implementation of the program.
    As required under the MOAs, the funds will only be used for purposes
    that are attributable to accepting and managing the cylinders received
    from USEC. However, Memoranda of Agreement funds will be used in
    conjunction with appropriated funds for procurement activities, NEPA
    activities, and other near-term activities associated with the
    DUF6 program.
        Question. Please outline for the Committee the schedule and key
    milestones DOE has identified for the Depleted Uranium Hexafluoride
    Conversion plan.
        Answer. The Department's current schedule and key milestones are
    attached (see attached table). This is an aggressive schedule that
    should result in the awarding of contracts in 2000 and the initiation
    of construction activities in 2002. This schedule would, therefore
    achieve the goals anticipated in Public Law 105-204 two years earlier
    than required by the law.
        The Department intends to issue a Final Plan for the Conversion of
    Depleted Uranium Hexafluoride by the end of May. The Final Plan will
    reflect the Department's review of the responses to the Expression of
    Interest ideas from affected members of the local communities, Congress
    and other stakeholders. This document will provide a more detailed,
    final schedule for the DUF6 conversion project.
        Question. Recently the Department issued an Expression of Interest
    on the DUF6 conversion plan. Please inform the Committee the
    number of responses the Department has received and which organizations
    responded to the Department's request.
        Answer. The Department has convened a Source Evaluation Board (SEB)
    to analyze the responses to the EOI, prepared the draft Request for
    Proposals, and other acquisition responsibilities associated with
    contracting for DUF6 conversion. The Department was pleased
    with the industry's response to the EOI. The number of respondents to
    the EOI far exceeded our expectations and we have gained important
    insights from the responses. Regarding your specific questions, the SEB
    considers the number of EOI's received and the company names providing
    the EOI's to be Source Selection Sensitive information. Thus, the
    Department cannot release this information at this time. However, the
    Department recognizes Congressional interest in this process and is
    evaluating whether it can release summary, non-proprietary EOI data to
    the Congress and public. A determination from the Office of General
    Counsel is expected soon.
        Question. The Department has proposed to use $5 million associated
    with conversion of depleted uranium cylinders. Please explain for what
    purpose this funding will be spent.
        Answer. The $5 million will be used for site specific National
    Environmental Policy Act (NEPA) activities to enable the Department to
    begin conversion facilities construction and begin acquisition
    activities to meet the schedule anticipated by Public Law 105-204. It
    should be noted that the budget request to Congress specified that some
    of the funds would be used for preparation of a Request for Proposals.
    The Department currently plans to issue the Request for Proposals prior
    to the beginning of fiscal year 2000, enabling remaining funds to be
    used to accelerate required NEPA analysis.

                                                MOA FUNDS BY FISCAL YEAR
                                                [In millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                   Major activities                 1999    2000    2001    2002    2003    2004   2009-09    Total
    ----------------------------------------------------------------------------------------------------------------
    Cylinder Maintenance.........................    6.27    6.98    4.38    1.65    1.85    1.65     4.50     27.28
    Yard Construction............................    7.92    3.50  ......  ......  ......  ......  .......     11.42
    Conversion Preparation.......................    3.30  ......  ......  ......  ......  ......  .......      3.30
    Funds Available for Additional Conversion         TBD     TBD     TBD     TBD     TBD     TBD      TBD     24.00
     Preparation, and Required Near-Term
     Activities..................................
                                                                                                           ---------
          Total..................................  ......  ......  ......  ......  ......  ......  .......     66.00
    ----------------------------------------------------------------------------------------------------------------

        FULL-SCALE DUF6 CONVERSION CAPABILITY SCHEDULE AND KEY MILESTONES
    ------------------------------------------------------------------------
               Approximate Dates                      Key Milestone
    ------------------------------------------------------------------------
    First Quarter 1999.....................  Issue a request for Expressions
                                              of Interest (EOI).
                                             Complete and issue the final
                                              PEIS.
    Second Quarter 1999....................  Receive EOI responses.
                                             Issue the PEIS Record of
                                              Decision.
                                             Issue Final Plan.
                                             Issue draft Request for
                                              Proposals (RFP) for conversion
                                              contract.
    Third Quarter 1999.....................  Receive comments on draft RFP.
                                             Issue final RFP for conversion
                                              contracts.
    Fourth Quarter 1999....................  Receive proposals.
                                             Begin proposal evaluation.
    2000...................................  Award DUF6 conversion
                                              contract(s).
    2002...................................  Complete design, and start
                                              construction of full-scale
                                              facilities.
    ------------------------------------------------------------------------

              armed guards at the paducah gaseous diffusion plant
        Question. In the Energy and Water bill from last year, there was a
    provision to restore arming and arrest authority to the security guards
    located at the Paducah Gaseous Diffusion plant. The legislation, which
    was developed in cooperation with your office and USEC, requires that
    the two parties split the costs appropriately. Nearly eight months
    later, this problem has not been resolved and I am told this problem
    might not be resolved for another eight months. Please explain why this
    problem hasn't been resolved and when you expect the law to be fully
    implemented.
        Answer. As you know, the Department's regulatory oversight over the
    United States Enrichment Corporation (USEC) ended on March 3, 1997,
    when the Nuclear Regulatory Commission assumed oversight authority over
    USEC. With the enactment of the fiscal year 1999 Energy and Water
    Development Appropriations Act, the Department of Energy and the United
    States Enrichment Corporation (USEC) have been working together and
    have now established a process to restore the arming, arrest and use of
    deadly force authority for the guard force at the Paducah Gaseous
    Diffusion Plant consistent with the Act. A conservative estimate of the
    time needed, these authorities should be restored to the entire guard
    force by no later than December 31, 1999. Although the responsibility
    for rearming the guard force largely rests with USEC, the Department
    will take those steps under our control to accelerate this process. We
    believe based on discussions with USEC and a recently completed
    assessment of their program, discussed below, that they are well on the
    way to restoring these authorities and that by the end of August, there
    will be guards at Paducah who have completed the requisite training and
    qualification and who have been issued Weapons Authorization Cards by
    the Department.
        There are two major activities that USEC must complete in order for
    the Department to reissue Weapons Authorization Cards to the guard
    force: one, demonstrating that pertinent federal requirements for
    arming, arrest, and use of deadly force authority have been put into
    place and following this, training and qualifying the guard force to
    meet the regulations. The regulations themselves are extensive, derived
    principally from Titles 10 and 27 of the Code of Federal Regulations
    and addressing a wide range of topics: physical protection of property,
    medical fitness implementation, limited arrest authority, use of force
    by protective officers, and pertinent regulations of the Bureau of
    Alcohol, Tobacco and Firearms. Meeting these requirements demands a
    significant investment of time, resources and infrastructure by USEC
    (e.g., employing firearm safety professionals, medical professionals,
    maintaining a firing range and exercise facilities).
        Based on a recently completed on-site inspection by DOE of Paducah,
    we believe that USEC has made substantial progress in re-establishing
    the supporting program for these authorities and that they should be
    ready to start training and qualifying guards by the end of July 1999.
    To further accelerate this process, DOE will issue Weapons
    Authorization Cards to individual guards as they complete their
    training. Ultimately, the time needed to fully restore these
    authorities is under the control of USEC, who is responsible for
    training and qualification, including the scheduling of training.
                                     ______

                      Questions Submitted by Senator Burns

                                    general
        Question. I noticed in your testimony that you state 85 percent of
    domestic energy use comes from fossil fuels. And of that, almost 30
    percent is from coal. Then you point out that this level of consumption
    will not likely change in the coming decades. My state can help here
    since Montana has the largest coal reserves of any state in the United
    States (120 billion short ton). So what are you doing to promote the
    development of coal within this country?
        Answer. Coal is the most abundant and lowest cost energy form in
    the United States. However, there are challenges to using coal cleanly
    to reduce both traditional pollutants and greenhouse gases. The
    Department of Energy's (DOE) role includes meeting the research and
    development (R&D) challenges of improving the efficiency of the fossil
    energy cycle in a clean, environmentally friendly manner in order to
    continue to benefit the Nation through the economic advantages of coal.
    These challenges include further technological improvements to meet new
    smog and particulate standards and possibly new requirements for air
    toxic emissions. Land constraints will increase the need to reduce
    solid wastes. Also, pressures will increase to find economically
    acceptable ways to reduce both emissions and atmospheric concentrations
    of greenhouse gases.
        DOE's R&D effort is, therefore, aimed at providing a combination of
    ultra-high efficiency technologies and low-cost carbon capture and
    disposal technologies could make it possible to significantly reduce,
    if not eliminate, these environmental concerns over coal and permit the
    Nation to continue to prosper from coal's economic benefits. Technology
    now appears within reach that can double today's power plant
    efficiencies, virtually eliminate air emissions, release no net carbon
    dioxide, and still produce power that is low enough in cost to be
    competitive with the best of today's pulverized coal plants. It may
    also be possible to use coal as a low-cost resource in an integrated
    ``energy complex'' to produce high-grade, low-pollution transportation
    fuels that, coupled with improved engine technology, could double fuel
    combustion efficiency and further reduce air emissions from the
    transportation industry.
        While much remains to be done to ensure that coal use remains a
    domestic energy option well into the next century, the DOE has already
    achieved much to enable ``clean'' coal technologies to be a cost
    competitive and environmentally superior option in the near term
    through its successes in the Clean Coal Technology (CCT) Demonstration
    Program. For example, barriers to using the Nation's vast low-sulfur,
    but low-energy-density western coal resources are being addressed
    through two advanced, coal-upgrading projects under this cost-shared
    program. In the ENCOAL project in Campbell County, Wyoming, and Rosebud
    SynCoal Partnership project in Rosebud County, Montana, a stable coal
    product is produced which has a low-moisture content, low-sulfur
    content, and a high heating value (12,000 Btu/lb). Additionally, the
    ENCOAL project produces a liquid product equivalent to No. 6 fuel oil.
    The products from these two projects are being sold to utility and
    industrial consumers.
        Notwithstanding these and many other near-term commercial
    successes, ongoing research activities to provide future opportunities
    for clean coal technologies, advanced power generation systems, and
    advanced clean fuels are being promoted by the Department.
        Advances through clean fuels research will provide, in the longer
    term, for coal-derived substitutes for traditional petroleum products
    that have the potential to provide the secure supply of transportation
    fuels that is needed by major sectors of the Nation's economy.
    Development of such a coal-based fuels industry will positively affect
    our balance of payments, create high-paying jobs, and ensure a stable
    alternative source of supply as increase in demand is expected after
    2015. In addition, these fuels will be more environmentally friendly
    than petroleum-based products, while using the Nation's vast domestic
    coal resources to provide the necessary level of energy security. This
    research is carried out by the Department in partnership with industry,
    academia, and other Government agencies and laboratories at the
    national and state levels.
        Question. I understand, from your testimony, that you are focusing
    on developing modeling tools to evaluate future combustion systems.
    What will these modeling tools do and how will these modeling tools
    consider different combustion sources (coal, gas, and oil)?
        Answer. A Virtual Demonstration Program, which was recently
    initiated in Fossil Energy, will increase the effectiveness of advanced
    power plant designs by providing the modeling tools and computational
    framework necessary to enhance overall predictive capability and
    process understanding. The result will be to reduce the time and costs
    associated with the transition from pilot-to commercial-scale
    development of the next generation of combustion systems. It will also
    help identify the power and fuel system advanced research needs in
    power and fuel system r&d. Those r&d efforts will focus heavily on
    developing the fundamentally-oriented data and integration tools
    required to support fuel-flexible (coal, oil, natural gas, biomass,
    etc.) integrated gasification combined cycle and pulverized coal-based
    technologies, such as Vision 21 high performance power and fuels
    systems.
        The modeling tools to be developed will take advantage of the most
    recent advances in the field of virtual demonstration to include: 3D
    visualization technology, integrated information management, process
    simulation, advanced numerical techniques for control and process
    simulations, and overall model integration.
        Since these models are based on fundamental scientific principles
    (the laws of fluid dynamics, chemical kinetics and thermodynamics,
    structural mechanics, radiation, etc.), their results and their
    applications will not be limited to one fossil fuel feedstock but will
    be applicable to coal, oil and gas as well.
        Question. I noticed your fiscal year 2000 budget request is
    generally increasing. This reassures me that you recognize the
    importance of supporting our domestic energy industries. As you know,
    we are losing much of our domestic production capabilities, such as in
    the oil and gas industries, due to low energy prices. Even though I am
    working to address that problem, development of renewable energy
    sources in the United States is another area that I have much interest.
    However, the fiscal year 2000 budget is tight as you well know. Since
    we probably won't be able to fund all of your requested increase, what
    are your priorities in fiscal year 2000?
        Answer. Increased investments in technology research, development
    and pre-commercial deployment are of critical importance to meeting the
    energy and environmental challenges of our times and of the next
    century. However, we realize the existence of budget constraints and
    will work closely with the Committee to identify priorities.
                         solar and renewable resources
        Question. You may have heard about a proposed ethanol plant to be
    constructed in Great Falls, Montana. This project hasn't yet be
    constructed even though it has all of the necessary permits and plans
    approved. They are having financial troubles. This plant plans to
    convert wheat waste into ethanol. I understand you are developing
    demonstration plants to convert agricultural products into ethanol such
    as:
      --sugarcane wastes in Louisiana;
      --rice straw in California; and
      --solid wastes in New York.
        What are the Department's plans to develop other demonstration
    projects to produce ethanol from other dedicated crops, such as wheat,
    and forest waste?
        Answer. The Department has requested funds to develop partnerships
    for commercial scale technology demonstrations, using agricultural
    residues and forestry wastes, in industry owned plants to produce
    ethanol and co-products. These plants will be ``first-of-a-kind'' waste
    to ethanol facilities in the United States. We believe that these low
    cost cellulosic waste materials offer opportunities to produce ethanol
    at competitive costs in the near term. The Department's major role with
    our partners has been to provide technical and engineering assistance
    in obtaining process data and engineering warranties. Our industrial
    partners will obtain private financing to construct, operate, and own
    these cellulosic-based facilities. The Department's approach in
    developing these new technologies avoids some of the financial
    difficulties that may be experienced when depending on commodity crops
    that also supply higher valued food markets. Our longer term plans call
    for the use of dedicated crops (switchgrass, hybrid poplar, willow)
    which are being developed for high biomass productivity at low cost, in
    the year 2004. Our understanding is that the facility planned for Great
    Falls, Montana will use wheat and barley grain, which employs a starch
    based process that has been used for many years by the corn ethanol
    industry. In most cases, there are few, if any, process and engineering
    technology or warranty issues requiring resolution.
                         solar and renewable resources
        Question. I have a keen interest in your biomass/biofuels program
    given my state produces a fair amount of agricultural products which
    could be converted into producing electric power or transportation
    fuels. I understand that for fiscal year 2000 you will be increasing
    funding for the development of biomass conversions systems for:
      --wood into ethanol in Vermont;
      --alfalfa into ethanol in Minnesota;
      --willow and coal into ethanol in New York; and
      --switchgrass into ethanol in Iowa.
        What other biomass conversion systems, such as wheat into ethanol,
    have you considered? How can we help encourage you to consider such
    conversion systems?
        Answer. The Department shares your interest in converting
    agricultural products into electric power or transportation fuels. We
    have requested additional funds under the Bioenergy Initiative, which
    will integrate activities critical to the future viability of a biomass
    based industry that will produce products such as fuels, power, and
    chemicals. Technologies and systems that are developed and demonstrated
    under the initiative could be applied to a broad range of feedstocks,
    including those that are grown in Montana. The projects in Vermont,
    Minnesota, New York, and Iowa are actually biomass power projects that
    will demonstrate gasification and biomass co-firing options. Results
    from these projects will also apply, in large measure, to Montana. With
    regard to ethanol, the biomass conversion systems that the Department
    is considering will apply to most agricultural residues, including
    wheat straw.
             doe strategy/plans to develop co-firing demonstrations
        Question. Since it has been shown that biomass can replace up to 15
    percent of the fuels used by existing coal power plants, what are your
    strategy and plans to develop cost-sharing demonstrations for such co-
    fired (biomass and fossil fuels) plants in fiscal year 2000?
        Answer. DOE's strategy has been to demonstrate co-firing options in
    a broad cross-section of boiler types with a variety of dedicated crops
    and residues in order to expand the base of utilities employing co-
    firing in existing generating units. This is being accomplished on a
    cost-shared basis with utilities and other partners.
        To further the commercial application of biomass co-firing, certain
    issues remain that need to be addressed. These include examining
    numerous types of biomass can be used for co-firing including wood,
    energy crops such as switchgrass, and agricultural residues. Similarly,
    coals (which can range from a lignite coal to an anthracite), have
    varying characteristics that can affect the success of co-firing.
    Additional issues that need to be addressed involve materials handling,
    how materials are delivered into the boiler itself, and boiler design
    that can vary from either a stoker design to pulverized coal type.
    Furthermore, utility restructuring is changing the ownership profile of
    utility boilers which will affect the planning and ultimate decision
    making process by the owners of the generating stations.
        With these factors in mind, it is our intent to pursue additional
    partnerships in other areas such as rural electric cooperatives,
    federal facilities, and non-utility generators, including colleges and
    universities where coal is used to either generate heat or power. These
    cost-shared demonstrations are envisioned as part of a new program
    element that will round out the examination of the various options and
    approaches to cofiring in order to resolve any remaining technical
    barriers and identify the characteristics that will lead to viable
    ongoing co-firing operations by the private sector.
                                hydrogen program
        Question. Regarding other renewable resources, such as hydrogen,
    what are the Department's plans and funding requests in fiscal year
    2000 to develop fuel cells from hydrogen?
        Answer. In support of the President's Council of Advisors on
    Science and Technology's report, the Hydrogen Program is collaborating
    with the other fuel cell programs within the Offices of Transportation
    Technologies and Building Technologies. The Hydrogen Program does not
    independently develop fuel cells, but uses the technology developed by
    the other programs to support industry apply the technology for
    electricity generation. In the fiscal year 2000 budget, the Hydrogen
    Program has requested $1.5 million to build prototype 50kW and 25kW
    Proton Exchange Membrane fuels cells for stationary power in remote
    villages and battery replacement applications, respectively.
                                   user fees
        Question. I understand that the Basic Energy Sciences Program
    involves the use of major facilities at various national laboratories.
    And I understand that these national laboratories consume much of the
    budget for the Basic Energy Sciences Program. What considerations have
    you made to adopt a user fee concept for these facilities to cover more
    of their increasing costs since other organizations use these national
    labs?
        Answer. The Basic Energy Sciences (BES) facilities are part of the
    Department's system of scientific user facilities, the most
    sophisticated and successful of its kind in the world. These facilities
    enable researchers to gain the new knowledge necessary to achieve the
    Department's missions and, more broadly, to advance the Nation's entire
    scientific enterprise. The magnitude of these user-facility investments
    exceeds the resources of all but the federal government. These
    investments allow the most promising scientific opportunities to be
    addressed and attract the world's brightest scientists to unlock
    nature's most challenging secrets, thus helping the United States
    maintain its industrial and technological competitiveness. Access to
    these extraordinary tools is provided by DOE on a no-charge basis to
    all qualified researchers whose intention it is to publish in the open
    literature.
        The Department's longstanding user fee policy was formulated to
    encourage use of these unique facilities by leading researchers under
    the following philosophy:
      --to promote increased cooperation among Government, industrial, and
            academic researchers for the benefit of the entire Nation and
            to enable the United States to maintain its industrial and
            technological competitiveness in the world,
      --to encourage industry and academia to conduct basic research of
            direct programmatic interest to DOE,
      --to encourage investment by industry and academia in facilities
            through the fabrication of instrumentation and beamlines, thus
            leveraging the Government's investment in its facilities,
      --to make available the instrumentation and beamlines constructed by
            participating research teams to general users.
        DOE also recognizes that several committees that have considered
    the issue of user fees to supplement the base operating expenses of
    national user facilities have not recommended implementation of user
    fees. These studies include the 1991 ``Report to Congress on the
    Department of Energy's User Fee Assessment and Collection Practices,''
    the study by the OECD Megascience Forum Working Group on Removing
    Obstacles to International Cooperation (June 1998 report of the
    Subgroup on Access to Large-scale Research Facilities), the November
    1997 report of the Basic Energy Sciences Advisory Committee (BESAC)
    Panel on Synchrotron Radiation Sources and Science, the report by the
    OSTP Interagency Working Group on Structural Biology at Synchrotrons
    (``Synchrotron Radiation for Macromolecular Crystallography,'' January
    1999), and the NAS study ``Developing a Federal Materials Facilities
    Strategy'' supported by the Board on Chemical Sciences and Technology
    of the Commission on Physical Sciences/Mathematics and Applications.
        A few of the reasons that the implementation of a user fee policy
    may adversely impact user facilities are:
        1. A large amount of cost sharing already occurs at BES user
    facilities with respect to beam line construction, instrumentation and
    facility upgrades. Levying user fees upon NSF and NIH researchers to
    supplement operating costs may well reduce these agencies' support of
    instrumentation.
        2. Sharing base operating expenses among offices/agencies that use
    a facility has been shown not to work--such arrangements result in
    unclear ownership responsibilities and increased funding uncertainties.
        3. User fees discourage industrial use of facilities, thus
    decreasing long-term industrial research and technology transfer
    activities.
        4. Fragile international collaborations relating to user facilities
    are all based on DOE's current policy; if this changes, the U.S. could
    be forced to pay user fees at foreign facilities. The adoption of
    policy to charge foreign users a fee to access U.S. facilities would
    open the door for foreign facilities to do likewise. Implications of
    such a change could be enormous. For example, it is estimated that the
    U.S. uses about 25 percent of CERN (the European Laboratory for
    Particle Physics). The annual budget for CERN is approximately $600M,
    so the U.S. could be asked to pay up to $150M for use of this facility
    alone. It should be noted that U.S. activities at CERN and at other
    European laboratories are now largely balanced by foreign usage, and
    in-kind contributions to DOE (i.e., the High Energy Physics facilities
    for this example).
        5. Since most research (over 75 percent) at the BES facilities is
    federally funded, the effect of charging user fees for nonproprietary
    research would be to transfer funds from one agency to another.
        DOE's longstanding user fee policy was developed within the
    framework of OMB Circular A-25 and was implemented in 1979.
                                     ______

                      Questions Submitted by Senator Craig

       termination and electrometallurgical treatment funding at argonne
                              national laboratory
        Question. One of my greatest concerns with DOE's fiscal year 2000
    budget request is the $20 million shortfall for Argonne National
    Laboratory-West in the area of electrometallurgical processing. The
    funding request for the Termination account is $20 million lower than
    the fiscal year 1999 appropriation. Finding a remedy for this shortfall
    is one of my highest priorities. A cut this deep would result in
    several hundred layoffs at Argonne National Laboratory. In fact, to
    minimize the overall impact, the layoffs would have to occur just a few
    short months from now. Why aren't these layoffs mentioned in the DOE
    budget request?
        Answer. The Department's fiscal year 2000 request will support the
    continued work of the Laboratory's skilled workforce until a decision
    is made on the future use of the technology. Their work to investigate
    the application of electrometallurgical technology to the Department's
    spent fuel management challenges is essential to enabling the
    Department to make an informed decision on the future use of this
    technology. After the Department completes its Environmental Impact
    Statement on the use of electrometallurgical technology, it will issue
    a formal Record of Decision in January 2000. No lay-offs will occur
    prior to this decision. If the Department decides to proceed with the
    use of this technology, we will seek to reallocate sufficient
    Department funds to implement such a decision; if, instead, the
    Department decides against using electrometallurgical technology, we
    will proceed to terminate program activities.
        Question. I understand that the Department plans to complete early
    next year the environmental impact statement on the treatment of
    sodium-bonded spent fuels. Therefore, assuming a positive outcome to
    the EIS, funding will be required in fiscal year 2000 to initiate full-
    scale treatment of sodium bonded fuels. However, the budget that the
    Administration submitted to Congress includes no funding for treatment
    in fiscal year 2000. Does that mean that the Administration is
    anticipating a negative outcome from the EIS process?
        Answer. We remain optimistic about the application of the
    electrometallurgical treatment technology to the Department's inventory
    of sodium bonded spent nuclear fuel. As you know, the demonstration
    project will be completed in fiscal year 1999. Additionally, by the end
    of the calendar year, the National Research Council will complete their
    independent technical review of the electrometallurgical treatment
    technology. Thus far, the National Research Council has indicated that
    there is no other technology sufficiently developed, with the exception
    of the PUREX process, that could be used for treatment of sodium bonded
    fuel. Further, they have indicated that any other technology, including
    PUREX, would require a significant investment of funds and time for
    development and demonstration.
        We are confident that the EIS and the review by the National
    Research Council will provide a strong basis for a decision on whether
    to use this technology for the treatment of the remaining sodium bonded
    fuel. Once a decision is made, the Department will seek appropriate
    adjustments in its fiscal year 2000 budget.
        Question. Is it true that the electrometallurgical technology that
    is being developed by Argonne has potential application in concepts
    such as accelerator transmutation of waste, metal cooled reactor
    systems, and other concepts?
        Answer. Electrometallurgical treatment technology development at
    Argonne National Laboratory is directed only to the Department's
    mission of conversion of spent nuclear fuel into durable high-level
    waste forms which can be qualified for disposal. I understand that
    related, but different, technologies may be applicable to the
    accelerator transmutation of waste concept. This possibility is part of
    a roadmap now being prepared by the Department's Office of Civilian
    radioactive Waste Management.
                       nuclear energy research initiative
        Question. The fiscal year 2000 budget requests only a modest
    increase in DOE's Nuclear Energy Research Initiative--from $19 million
    this year to $25 million in fiscal year 2000. This does not seem to
    demonstrate a very strong commitment on the part of the Administration
    to support nuclear energy R&D.
        The DOE request of $25 million for fiscal year 2000 will allow only
    about $6 million in new awards in fiscal year 2000; the other $19
    million will be required to fund the second year of projects that will
    be initiated in fiscal year 1999. By comparison, for fiscal year 1999
    DOE received $19 million for NERI, and received 307 proposals
    requesting a total of $300 million dollars.
        Do you believe that an increase of $6 million next year is adequate
    to support the large number of worthy new proposals anticipated in the
    next fiscal year?
        Answer. The fiscal year 2000 request of $25 million, a $6 million
    increase over fiscal year 1999, will allow the start of some new
    research efforts in fiscal year 2000 in addition to continuation of the
    second year of research for the awards made in fiscal year 1999. We
    believe the modest funding increase from $19 million in fiscal year
    1999 to $25 million in fiscal year 2000 will allow the Nuclear Energy
    Research Initiative (NERI) program a controlled growth that will assure
    effective program implementation and goal achievement. However, as
    evidenced by the overwhelming response from the nuclear community to
    the fiscal year 1999 NERI solicitation, the number of new proposals
    funded in fiscal year 2000 will likely be significantly smaller than
    number of worthy proposals expected to be received. It is our hope that
    this program will grow as we demonstrate its value to the Nation.
        Question. Given the importance that the Administration has assigned
    to issues of climate change, and given the obvious advantages of
    nuclear power in addressing climate change, I'm puzzled as to why the
    Administration has requested a $270 million increase for conservation
    and renewable energy research programs, but only an $11 million
    increase for nuclear energy research programs. In fact, the
    Administration's request for nuclear energy research is lower than last
    year's request. Can you explain the logic behind the Administration's
    request?
        Answer. The Administration's budget request for fiscal year 2000
    includes $25 million for NERI, an increase of $6 million, and $5
    million for Nuclear Energy Plant Optimization (NEPO), a proposed new
    program. The fiscal year 2000 budget request of $25 million for the
    NERI program builds on the work started in fiscal year 1999 and funded
    by the Congress at $19 million. We believe that the moderate increase
    in funding we have proposed is appropriate and will provide time to
    assure that the program is effectively accomplishing the objectives. It
    is our hope that the program will grow as we demonstrate its value to
    the Nation. With respect to the NEPO Program, we believe that the
    request of $5 million is sufficient to begin to demonstrate the
    benefits of this program. Both the NEPO and NERI programs are essential
    to retain nuclear energy as a viable option and key component of the
    Nation's energy mix.
        Question. With the large number of research proposals that will be
    funded under NERI, how does the Department plan to integrate this
    research into a rational, long-term nuclear energy research and
    development program?
        Answer. The focus of NERI is the resolution of the longer-term
    issues affecting the future use of nuclear energy. These issues, namely
    proliferation, economics and waste generation, were clearly identified
    in the November 1997 Report of the Energy Research and Development
    Panel of the PCAST. The PCAST report also provided recommendations for
    research in certain key areas: proliferation resistant reactor and fuel
    technology, new reactor designs with higher efficiency, lower cost and
    improved safety; low-power reactors; and new techniques for on-site and
    surface storage and permanent disposal of nuclear waste. These
    recommendations are the focus of the Department's long-term R&D program
    and the basis for the fiscal year 1999 and fiscal year 2000 budget
    requests.
        The Department views NERI as a ``birthing place'' where the
    scientific and engineering ideas of our Nation's brightest researchers
    can be developed into more focused and specific projects that will
    provide solutions to the nuclear energy issues. R&D activities under
    NERI will initially be small to moderate in size and scope, and
    typically be conducted over a three-year period. The Department plans
    to monitor the progress and success potential of each R&D effort. The
    R&D conducted during the initial three-year period will identify
    promising scientific and engineering solutions and technological
    advancements that will require specific project efforts to achieve R&D
    objectives necessary to effectively resolve or reduce the effects of
    the nuclear issues.
         The Nuclear Energy Research Advisory Committee (NERAC),
    established by the Department in 1998, will conduct periodic reviews of
    on-going R&D programs and advise the Office of Nuclear Energy, Science
    and Technology on its long range R&D plans, priorities and strategies.
        Question. Will you draw on the facilities and expertise at Idaho's
    laboratories for the integration and conduct of this long-term research
    and development?
        Answer. The Idaho National Engineering & Environmental Laboratory
    (INEEL) and Argonne National Laboratory (ANL-W) represent the
    Department's core nuclear research and development capability. The
    Office of Nuclear Energy, Science and Technology will continue to
    depend on assistance from these Idaho national laboratories in crafting
    our long term nuclear technology research and development strategy, and
    to provide key nuclear research. For example, INEEL and ANL-W were
    among the many organizations that submitted R&D proposals to the
    Nuclear Energy Research Initiative. Both organizations were successful
    in having several proposals selected for funding. The INEEL is a
    participant is five of the proposals that were funded, and ANL is a
    participant in 10 proposals that were funded.
                 university reactor fuel assistance and support
        Question. DOE has proposed $11.345 million for university reactor
    fuel assistance and support in fiscal year 2000, a modest $345,000
    increase over fiscal year 1999. This program is essential to ensuring
    an adequate supply of nuclear-trained professionals for the nuclear
    power industry, the national laboratories, the environmental
    restoration industry, and a host of other industries. This program also
    provides funding to support the operation of the 28 university-based
    nuclear research reactors in the U.S. Given the importance of
    university nuclear engineering programs and university research
    reactors to maintaining the viability of nuclear power in the U.S., do
    you believe this funding level is adequate?
        Answer. While the University Reactor Fuel Assistance and Support
    Program has had significant funding increases over the past several
    years, the need to further strengthen the nuclear engineering
    infrastructure remains. Our request of $11.345 million in fiscal year
    2000 will continue a level of effort in important areas such as the
    Nuclear Engineering Education Research (NEER) initiative. However, as
    we enter the next century, there are challenges that must be met to
    strengthen our educational infrastructure and train the next generation
    of nuclear scientists and engineers. Clearly, more resources from the
    Department can help assure that the Nation meets these important
    challenges. But this work will also require a rededication by the
    universities, our national laboratories, and particularly industry to
    modernize research reactors and enhance university nuclear engineering
    programs.
                 clean air credits and atlantic council report
        Question. A report by the Atlantic Council recommended that
    governments assure the financial integrity of nuclear power by giving
    credit to nuclear energy for avoided emissions. This is something that
    is not currently done under the Clean Air Act for SO2.
        What is DOE's reaction to a proposal such as this in the context of
    the Administrations electricity restructuring bill? Do you see this as
    a viable proposal for acknowledging nuclear's non-emitting contribution
    to our electricity supply?
        Answer. The primary focus of the Administration's bill on
    electricity restructuring is on competition and consistent with that
    focus, the bill does not include significant environmental provisions.
    However, we understand that the type of allocation suggested could be
    accommodated under the existing law. Several utilities have discussed
    this issue with the Department and the Environmental Protection Agency,
    which has the primary jurisdiction in this area. The matter remains
    under consideration. The individual states have considerable discretion
    in how to reach emission levels specified in their State Implementation
    Plants.
        The Department believes that a reliable and affordable electric
    power supply is critical for the U.S. to enjoy a strong economy and
    sustained growth. Such a supply of electricity requires diversity in
    its fuel mix--we need to maintain a diverse, secure energy portfolio of
    fossil fuels, nuclear energy, and renewables. Nuclear energy has been
    an important part of this diversity and generates electricity without
    emitting any greenhouse gases or other harmful air pollutants such as
    sulfur oxides and nitrogen oxides. The 104 nuclear power plants in the
    U.S. provide approximately 20 percent of the electricity generated and
    avoid more than 150 million metric tonnes of carbon emissions annually.
    With new requirements for lower emissions of sulfur dioxide and
    nitrogen oxide for fossil plants, particularly in the eastern part of
    the nation, the contribution of existing nuclear power plants in
    avoiding harmful air emissions becomes even more important.
        We are at a critical juncture with respect to the continued
    operation of nuclear power plants. Many U.S. nuclear plant owners are
    approaching a key decision point as to whether their plants should be
    shutdown at or before their initial license period, or whether they
    should apply for a twenty-year extension on that license. U.S. nuclear
    power plant licenses will begin to expire in large numbers in 2010;
    licenses for 13 plants representing some 11,700 MWe will expire in 2014
    alone. Faced with regulatory and economic uncertainties, some utilities
    already have exercised their option to close nuclear facilities well
    before their initial license expiration date. This trend has resulted
    in the closing of 6 reactors before license expiration, a loss of
    approximately 4,000 megawatts of U.S. generating capacity, in the past
    three years. Critical issues facing the continued operation of existing
    nuclear power plants need to be addressed in the near term so that this
    trend does not continue.
        Production costs (operating and maintenance costs plus fuel costs
    but excluding capital costs) for existing nuclear power plants at 1.91
    cents per kilowatt-hour [kwh] are comparable to those for coal at 1.83
    cents per kwh and are significantly less than those for natural gas at
    3.38 cents per kwh. An appropriate credit for avoided emissions would
    allow existing nuclear plants to better compete in the restructured
    market. Continued operation of existing plants is a prerequisite for
    the Nation to preserve the option of continued and expanded use of
    nuclear energy.
                  proposal for on-site storage of utility fuel
        Question. With respect to DOE's proposal to compensate utilities
    for the on-site storage of their spent nuclear fuel in lieu of taking
    possession in response to DOE's 1998 waste acceptance obligation, as
    the Director of the DOE program office which is most familiar with the
    nuclear power industry, do you foresee any concerns about the
    feasibility, safety, licensing or other regulatory issues associated
    with DOE's implementation of this on-site storage proposal?
        Answer. The Department currently is engaged in discussions with
    utilities concerning the feasibility of the Secretary's proposal to
    take title for on-site storage. The feasibility of implementing this
    proposal would depend on the willingness of the utilities to accept
    this proposal and the ability of DOE to fund the costs.
        Implementation of the on-site storage proposal would not be the
    long term permanent solution nor will it alleviate the need for
    additional spent fuel storage capacity required for continued operation
    of existing power plants. Although spent fuel may be safely stored at
    nuclear power plants under Nuclear Regulatory Commission regulations,
    current plants were designed only for short-term storage until spent
    fuel could be moved to the permanent repository being built by the
    Department.
                                renewable energy
        Question. According to DOE's budget there was over $1 billion in
    annual U.S. renewable energy technology sales in 1998. Can you tell us
    how much energy that represented?
        Answer. The reference to annual renewable energy technology sales
    was to the value of equipment sales and related services provided by
    U.S. industry. The $1 billion consists of approximately $100 million in
    sales of wind plants (112 MW), $228 million in sales of photovoltaic
    modules (54 MW), $400 million in sales for geothermal power plants (380
    MW) and $450 million in sales of geothermal heat pumps. These are total
    sales, both domestic and export, for these U.S. renewable energy
    industries. However, if one wanted to look at the sales of electricity
    produced by the installed renewable energy power plants in the U.S.,
    the nearly 2,300 megawatts of geothermal power in the states of
    California, Hawaii, Nevada, and Utah alone produces 14-17 billion
    kilowatt-hours per year of electricity, which is worth about $1 billion
    in annual utility sales, according to the geothermal industry.
        Question. It sounds like this is a rather robust market for
    renewable energy. We are also told by the Administration that consumers
    will be willing to pay more for so-called ``green power''. Given this
    robust market, why should the federal government continue to subsidize
    renewable power technologies at $325.2 million for fiscal year 2000?
        Answer. While $1 billion in sales may seem to indicate a ``robust''
    market for renewable power technologies, such a market size is still
    quite small in comparison to the scale of conventional energy
    technology markets. For example, the U.S. electric power industry as a
    whole has annual sales of about $215 billion. As to the market for
    ``green power,'' it is difficult to forecast human behavior in future
    restructured electric markets. It is not plausible at this time to
    assume with any confidence that demand for ``green power'' alone will
    be sufficient to create a large enough demand for renewable energy (and
    a corresponding level of profits for the industry to fully sustain its
    own R&D) so that the Federal Government should reconsider the level of
    R&D commitment to these technologies. In fact, we believe that
    sustained and even increased investments in renewable energy R&D are of
    critical importance to the nation. These technologies will improve
    local environmental quality, improve the diversity and security of our
    energy supply, reduce greenhouse gas emissions, and improve our long-
    term economic competitiveness. In part due to the past support of this
    Committee, the U.S. maintains a leadership position in some, but not
    all, renewable energy technologies. However, our economic competitors
    recognize, as we do, that a massive market for clean energy
    technologies, especially in the developing world, is emerging. Many
    studies and industry observers have concluded that developing these
    technologies and successfully competing for the global markets in clean
    energy technologies is of major importance to the U.S. These
    technologies are essential to meeting the energy, environmental, and
    economic challenges as we begin the next century.
               international renewable energy technology programs
        Question. Please describe DOE's international renewable energy
    technology programs.
        Answer. The Solar International Program's mission is to encourage
    greater acceptance and private-sector use of U.S. renewable energy
    technologies in overseas markets in ways that support U.S. national
    interests and policies. The primary goal of the program is to
    facilitate the expansion of U.S. renewable energy and energy efficiency
    technology exports to help meet the energy needs of developed and
    developing countries, reduce the rate of consumption of finite global
    resources, and address local and transnational environmental issues.
        The International Solar Energy Program addresses specific problems
    that slow the acceptance and use of new and existing technologies, and
    speeds the deployment of technologies by targeting distinct market
    barriers. It supports efforts to increase the competitiveness of the
    U.S. renewable energy industry in large and rapidly growing global
    energy markets. These efforts also support the U.S. industry's ability
    to make continuing technological improvements and achieve cost
    reductions that are critical to enhancing the competitiveness and
    market penetration of renewables in the United States. The program
    works cooperatively with the private sector and by increasing the in-
    country understanding of local renewable energy potential, and
    promoting dialogue and interaction with U.S. firms.
        The program has been redirected in response to Congressional
    direction to continue support for the U.S. Initiative on Joint
    Implementation but also to refocus activities into three broad program
    areas: Emerging Global Environmental and Energy Issues, Facilitate
    Market and Trade Development, and Advance U.S. Energy and Environmental
    Security Interests.
        The Emerging Global Environmental and Energy Issues will be
    implemented specifically through and in conjunction with the U.S.
    Initiative on Joint Implementation (USIJI). USIJI is a DOE-lead
    interagency program that supports the development of flexibility
    mechanisms under the U.N. Framework Convention on Climate Change (U.N.
    FCCC) such as Joint Implementation (JI), flexibility mechanisms, and
    Emissions Trading. This element will also focus on encouraging
    meaningful participation by developing countries in the U.N. FCCC.
        The Market and Trade Development element will accelerate reductions
    in technology production costs and advance deployment of technologies
    through overseas market expansion. It will stimulate global economic
    development and regional economic stability, and accelerate domestic
    economic growth and employment. This element will be implemented in key
    regions through bilateral (e.g., Gore-Mbeki in South Africa) and
    multilateral (e.g., Asia Pacific Economic Cooperation, Hemispheric
    Initiatives and International Energy Agency) technology cooperation
    activities and information exchange and dissemination. Private sector
    technology development will be encouraged while private sector
    deployment in strategic and emerging markets will be stimulated through
    project based activities.
        The Energy and Environmental Security element is designed to
    advance U.S. strategic interests in bilateral and multilateral energy
    and environmental security activities and will provide specialized
    assistance in the utilization of appropriate technologies. This element
    will be implemented in support of existing and emerging bilateral and
    multilateral treaties and agreements. This element will also assist the
    Department in meeting U.S. obligations and commitments to provide
    disaster relief and assistance by facilitating private sector
    technology development and deployment in strategic and emerging
    markets.
        Question. Are these programs really an export subsidy?
        Answer. The Solar International Program is not an export subsidy
    program. The purpose of the program is to stimulate global economic
    development and regional economic stability, and accelerate domestic
    economic growth and employment. One of the ways this will be
    accomplished is by facilitating international technology cooperation in
    bilateral and multilateral discussions, agreements and treaty
    negotiations. Developing and facilitating the deployment of appropriate
    technologies offers U.S. industries the opportunity to adapt existing
    or emerging technologies to meet unique needs and conditions of
    developing and transition countries. Technologies that may face
    significant commercial barriers domestically may be readily adaptable
    to large and growing markets in the developing world. Thus the program
    facilitates private sector technology development and deployment in
    strategic and emerging markets through project based activities.
        Question. If so, should we be doing the same for export of other
    non-emitting energy technologies such as nuclear and hydropower?
        Answer. Hydropower is a long-standing renewable technology and the
    International Solar Program is encouraging the acceptance and use of
    U.S. hydropower in developing and transition country markets.
    Additionally, the development of environmentally-friendly hydropower
    turbines (to mitigate impacts on fish and water quality) by DOE's
    Hydropower Program will help meet critical domestic and international
    needs at both existing and potential new hydropower sites. With
    adequate Congressional support and funding, research and development on
    these turbines should lead to commercially available products by about
    2010.
        The International Solar Program supports the export of renewable
    energy technologies and nuclear power is not considered a renewable
    technology. Nuclear energy technologies receive Congressional support
    independent of the International Solar Program. Consequently, it is
    inappropriate for this program to encourage acceptance of U.S. nuclear
    power technologies in developing and transition countries.
                                 climate change
        Question. Has DOE developed any analysis regarding the ``credit for
    early action'' legislation introduced by Senators Chaffee and
    Lieberman? If so, could you please provide a copy of this analysis for
    the record?
        Answer. In an ongoing effort, DOE, together with other agencies, is
    reviewing the ``early credit'' legislation introduced by Senators
    Chaffee and Lieberman to better understand its provisions. We have
    begun some exploratory work to assess how an early action crediting
    system might affect existing voluntary programs. To date, however, no
    report has been produced to analyze the possible efforts of this
    proposed legislation.
        Question. In 1998, the National Academy of Sciences/National
    Research Council released a report entitled, ``Global Environmental
    Change: Research Pathways for the Next Decade.'' Has DOE factored into
    its budget and programs the recommendations of this report regarding
    climate change research priorities? If not, why not?
        Answer. This important NAS/NRC report contributes to national
    understanding of the climate change issue and increasingly, DOE is
    embracing central themes of the NAS/NRC report.
        The emerging issue of climate change presents a need for more
    comprehensive integration of the efforts and budgets of multiple
    federal agencies. For this crosscutting issue, the existing budget
    process reveals a legacy of funding single issues and single agencies.
    We need to work hard to coordinate formerly independent approaches to
    address the issue of climate change.
        Among its many findings, the report discusses a very important
    national need to ``prepare for surprises.'' To this end, the report
    offers the pathway structure noted above as a way of casting a wide net
    while maintaining selective depth in important focal areas.

              Scientists believe strongly that unfocused research on the
            complex and varied Earth system is unlikely to be productive.
            On the other hand, scientists who view the world through
            pinholes are likely to bump into trees and fall off cliffs. How
            can needed focus be given to the USGCRP while still casting the
            research net sufficiently wide to catch the unexpected?

        How to prepare for surprises is a challenge and one of the reasons
    that the DOE Strategic Plan is shaped with a central guiding pathway
    structure:
      --Science and Technology Leadership
      --Energy Resources /Security
      --Environmental Quality
      --National Security
        With limited federal budgets, there is a need to maintain a focus
    on important areas. EERE develops clean and efficient energy
    technology. We help the US economy by reducing its energy intensity,
    often measured as energy consumed normalized by economic activity (E/
    GDP). Even conservative estimates place this improvement at about 1
    percent per year. During the decade of oil shocks, energy technologies
    were improving (becoming more efficient) as measured by this ratio at
    an annual rate of about 3 percent or more--which shows the importance
    of an enduring signal in sustaining improvements. DOE was heavily
    involved in this national success, and recently examined only five of
    several hundred technologies for long-term performance. Setting aside
    the considerable environmental benefits of these technologies, DOE
    worked with GAO to establish their cost-effectiveness. That study found
    that these five technologies cumulatively saved more than $28 Billion
    in avoided energy costs during the period 1978-1997. This compares
    quite favorably with the cumulative total investment in the federal
    energy efficiency and renewable energy programs for that same period of
    about $8 billion.
        We will continue to factor into our budget and programs the
    recommendations of the NAS/NRC report.
        Question. How does DOE set its priorities for climate change
    research?
        Answer. Priorities for the DOE energy technology R&D programs are
    set on the basis of projected benefits of these programs in terms of
    the strategic goals of the Department, the expected program costs, and
    likelihood of success. The strategic goals of the Department are:
      --improve the efficiency of the energy system;
      --ensure against energy disruptions;
      --promote energy production and use in ways that respect health and
            environmental values;
      --expand future energy choices; and
      --cooperate internationally on global issues. In order for a
            technology program to be funded, it must contribute to multiple
            DOE goals--not just climate change.
        Question. Has DOE participated in United Nations programs
    associated with the Global Environment Facility? If so, what projects?
        Answer. The Office of Energy Efficiency and Renewable Energy
    (EERE), through the interagency U.S. Country Studies Program (CSP),
    provides technical assistance and guidance to some Global Environmental
    Fund (GEF) funded projects. The intent is to improve the technical
    quality of deliverables and products from GEF funded activities.
    Specifically, U.S. CSP provides some technical assistance to improve
    the quality of country National Communications to the United Nations
    Framework Convention on Climate Change.
        The following countries are currently receiving technical
    assistance: Bangladesh, Bolivia, China, Egypt, Indonesia, Mexico,
    Micronesia, Philippines, Tanzania, Thailand and Uruguay.
                                  agriculture
        Question. I appreciate DOE's efforts in implementing the 1995
    Memorandum of Understanding between DOE and the Department of
    Agriculture by adding Agriculture as one of its Industries of the
    Future. As you know, I am a signatory to that MOU and have a long-
    standing interest in DOE's agriculture-related activities. The
    Administration's fiscal year 2000 Budget Request for the Industries of
    the Future program includes $4 million for Agriculture. How would this
    money be spent? Would precision agriculture technologies fit into your
    planned activities?
        Answer. We appreciate your support over the years for agriculture-
    related research and development at the Department. One of our newest
    efforts to help America's farmers is the Agriculture Team in the
    Industries of the Future program, which received $2 million of funding
    this fiscal year. The Team recently issued its first solicitation for
    projects, targeting two areas of industry's technology roadmap:
    processing and utilization. Product separation and new, more effective
    catalysts are examples of high priority topics in the first category;
    the structure and functionality of different plant parts are such
    examples in the second. The selection of winning proposals for that
    solicitation will occur in June. Those projects will likely require at
    least an equal amount of funds in fiscal year 2000 to complete or
    continue their planned work. Assuming the Agriculture Team receives the
    full funding requested, that would leave $2 million or less for new
    project starts in the Team's request for proposals for the next fiscal
    year, which it now plans to issue in mid-summer.
        The Team has not yet had full discussions with its industry
    partners in the agricultural, chemical and forestry communities to
    learn their views about the focus for the fiscal year 2000
    solicitation. Given the high level of interest in the current
    solicitation topics; the technical hurdles still to be overcome in just
    the processing area, for example, where the Idaho National Engineering
    and Environmental Laboratory has historically shown technical
    expertise; the need to avoid duplicating research work elsewhere, such
    as at the U.S. Department of Agriculture; and, the amount of funding
    that could be applied to new projects by the Agriculture Team next
    year, it seems unlikely that industry leaders would encourage us to
    broaden our focus to the other areas of the roadmap, plant science or
    production, where precision agriculture is included. However, we want
    to emphasize that no decisions have been made yet about the specific
    details of the Team's fiscal year 2000 solicitation.
                             fish friendly turbines
        Question. I am pleased to see that DOE's budget request includes $7
    million for continuation of research into advance--or what are
    sometimes called ``fish-friendly''--turbines. I think this research is
    key to a continued role for emissions-free hydropower as part of our
    electric generation system. Can you describe the status of DOE's work
    on fish-friendly turbines and how fiscal year 2000 funding would be
    utilized?
        Answer. Competitively-selected advanced turbine conceptual designs
    with improved environmental performance were completed by Voith Hydro,
    Inc. and the Alden Research Laboratory in 1997. Features of an advanced
    Kaplan-type turbine design developed by Voith are already being
    incorporated in the rehabilitation of the Bonneville Dam hydropower
    plant. These features include a minimum-gap runner, low flow
    turbulence, improved blade design with thicker entrance edges, smoother
    surfaces, and oil and grease reduction, all of which reduce injury and
    mortality to fish. Voith, teamed with Georgia Tech, will also conduct
    computer analyses to predict fish behavior in turbines. DOE is
    initiating pilot-scale proof-of-concept testing of the innovative Alden
    design in order to verify predicted biological performance. Biological
    studies of shear stresses experienced by fish in the turbine
    environment are being completed by the Pacific Northwest National
    Laboratory (PNNL) and the results will be factored into design criteria
    by the DOE program for both engineering design and prototype
    fabrication.
        In fiscal year 2000, DOE program funding will continue the
    biological studies being conducted by PNNL, specifically addressing the
    issues of turbulence, pressure and gas supersaturation. Proof-of-
    concept testing for the Alden design will be completed, and a
    competitive solicitation will be issued to select one or more industry
    partners to develop advanced turbine engineering designs, leading to
    full-scale prototype fabrication and testing at one or more operational
    hydropower sites.
                                     ______

                      Questions Submitted by Senator Reid

                federal research investment in renewable energy
        Question. After billions of dollars of Federal Research investments
    in renewable energy technologies, these still produce only about 2
    percent of U.S. electricity. Can you tell me why I should continue to
    support the funding requests for renewable technologies?
        Answer. Although most renewable technologies are competitive in
    limited market segments (for example, off-grid photovoltaics; biopower
    where low cost or negative cost waste feedstock is available or where
    cogeneration is appropriate; and geothermal where there are established
    high quality resources), these technologies have not yet reached the
    point where they can capture a large share of the overall electricity
    market. However, significant progress on technology cost, performance,
    and reliability has been made and several technologies are poised to
    make market inroads over the next decade.
        Since the mid-1970s when most of the renewable energy technology
    R&D programs began in earnest, the total investment has in the range of
    $5 to $6 billion (actual dollars). Since then, we have cut costs
    dramatically. For example, the cost of electric power from wind
    turbines which ranged from 30 to 40 cents a kiloWatt hour in 1980 has
    now dropped to between 4 and 6 cents a kiloWatt hour because of
    aggressive R&D. The next generation of turbines now under development
    should bring costs down to as low as 2 and a half cents per kiloWatt
    hour by 2002. Likewise, the first commercially available photovoltaic
    (PV) panels in the 1980s produced power at a cost of $1 per kiloWatt
    hour. Depending upon the materials used and the technology application,
    PV systems will be capable of delivering electricity for as low as 12
    to 20 cents per kiloWatt hour, and in the next decade it should drop to
    below 10 cents through continued R&D by 2010. By this timeframe, the
    price of photovoltaic generated electricity is expected to be
    competitive with conventional sources of power in remote locations,
    rural areas where transmission and distribution costs are high, and
    urban areas where transmission and distribution systems are congested.
        While non-hydropower renewables do only provide about 2 percent of
    our nation's electricity today, continuing reductions in technology
    production and O&M costs--combined with enhanced efficiencies and
    extended system lifetimes--will enable much further domestic market
    penetration of these clean power technologies. Though actual market
    generation rates will be determined by a number of factors such as
    growth in consumer electricity demand, competition from other
    generation technologies (particularly natural gas), and access to
    investment financing, we strongly believe that amount of power
    generated by renewables will at least triple by 2010.
        Finally, as more clean renewable energy technologies enter the
    commercial marketplace here in the U.S. and sales of our advanced
    technologies increase overseas, our economy will be strengthened as
    more jobs are created for the people of this nation. For these reasons,
    I strongly urge your continued support for the research and development
    of these technologies.
             research and development of alternative energy sources
        Question. Isn't it the case that research and development of
    alternative energy sources is essential to maintain access to
    affordable energy for future generations? Can't it be said that we are
    striving to find alternative sources not only because of environmental
    issues but for future access?
        Answer. Certainly part of the rationale for the Department's
    research and development on alternative energy resources is to ensure
    reliable access to affordable energy for future generations. We want to
    make sure that our nation's children--and all those that follow--
    continue to have the energy resources available that are essential to a
    strong economy and the American quality of life.
        We also believe, though, that our work on these technologies is
    already making significant impacts. For many U.S. citizens living in
    remote or underdeveloped portions of our country, power supplied by
    renewable resources can make the difference between having electric
    lights, refrigeration, and electronic communications or not. We strive
    to find clean and renewable electric power and transportation fuels for
    a variety of reasons, including: developing a variety of clean,
    domestic energy choices and thereby enhancing our energy security
    access to these energy resources in the future; mitigating
    environmental and human health impacts associated with energy
    production, consumption, and use; and to return economic benefits to
    the American taxpayer through the creation of skilled, high-wage jobs
    domestically and sales of the technologies they produce around the
    world.
                          use of the nevada test site
        Question. Nevada is a prime area for expansion of alternative
    energy resources. The Nevada Test Site is an ideal location for test
    and evaluation of renewable energy and alternative fuel technologies.
    How do you propose to use the Nevada Test Site for future research and
    design efforts?
        Answer. There are a number of hydrogen projects which have been
    discussed with Nevada personnel and which would be complementary to the
    Nevada Test Site. One project which includes a 50kW generation plant
    that can co-produce hydrogen and electricity has already been
    implemented. The Department issued a competitive solicitation in March
    to develop a prototypical hydrogen refueling station in Nevada. This
    fueling station will enable the refueling of either hydrogen or blends
    of natural gas and hydrogen into vehicles. As the number of
    alternatively fueled vehicles increase, a need for additional satellite
    fueling stations are expected. We anticipate the Nevada Test Site will
    be considered as the Department develops this refueling infrastructure
    through the competitive process.
        In the areas of Photovoltaics, concentrating Solar Power and Energy
    Storage, with ample space and excellent solar resources, Nevada is an
    ideal location for the test and evaluation of renewable energy and
    alternative fuel technologies such as storage systems. The Test Site is
    one possible location, but there are also other locations in Nevada
    that might be advantageous. The Nevada Portfolio Standard may provide
    an excellent incentive for commercial solar energy deployment in the
    near-to-mid term if it is implemented.
                              wind energy progress
        Question. What advances have been made regarding wind power? Have
    any strides been made toward getting wind power competitive with other
    technologies?
        Answer. We've made great progress in improving wind power in the
    last ten years. Cost of wind turbine projects has been reduced from
    2,000 to $/kW to less $1,000 while the cost of producing electricity is
    now in the range of 4-6 center per kWh. Additionally, rotor size has
    increased from 15 meters to 40 meters or more, generator size from 100
    kW to 750 kW or larger, and capacity factors from 0.2 to 0.35 to 0.40.
    Total capacity installed in the United States will increase to over
    2,000 MW this year, as the world total increases to over 10,000MW.
    We've also made major strides in understanding the physics of wind
    energy technology. These improvements, together with industry's
    experience in manufacturing and operating new turbines, are being
    applied in design of advanced wind turbines. Within the Next Generation
    Turbine project, seven conceptual designs of advanced turbines have
    been completed, and two projects are moving forward. The Next
    Generation Turbine effort, together with several other ongoing and
    planned joint projects with U.S. manufacturers, should substantially
    upgrade U.S. industry's wind technology capabilities and narrow the gap
    between wind and other competing forms of electric generation. These
    turbines are expected to bring costs down to as low as 2\1/2\ cents/kWh
    in good wind sites.
                            solar cells development
        Question. Solar cells that produce electricity directly from
    sunlight have been under development for a long time. Your program is
    trying to develop a solar cell that is only 40 percent efficient, so
    that's less than half of the solar energy would be converted to
    electricity. Why would such an inefficient power source be valuable?
        Answer. A 40 percent solar cell is not inefficient. Quite the
    contrary, development of a 40 percent solar cell would be a significant
    scientific accomplishment. When solar cells were first developed by RCA
    Bell Laboratory in the 1960s, efficiencies were in the 4 percent to 6
    percent range. The Department of Energy began an earnest R&D program in
    the mid-1970s, and over the past two decades has made dramatic
    improvements in the technology. Today, multijunction cells under
    concentrated sunlight can routinely achieve efficiencies in the 28
    percent to 32 percent range. Efforts to develop a four-junction device
    that could achieve 40 percent efficiency would yield dramatically
    reduced dollar per Watt values (greater than 50 percent) for
    terrestrial photovoltaics. It should be noted that the efficiency of
    the average automobile gasoline engine is less than 25 percent, yet
    everyone values the transportation they provide. Furthermore, coal
    fired plants are less than 40 percent efficient.
        A conservative estimate of the average residential roof size in the
    U.S. is 200 square meters (10 meters by 20 meters). The amount of
    energy in sunlight is 1000 Watts per square meter, which means 200,000
    Watts, or 200 kilowatts, strike the average residential roof in the
    U.S. (enough for 50 homes). Using a solar cell system that is just 10
    percent efficient would produce 20 kiloWatts of electricity, which is
    more than five times the amount of energy the home needs. Therefore,
    typical photovoltaic systems for residential use take up only a
    fraction of the space on the roof, and, at 10 percent, 20 percent or
    someday 40 percent efficiency, add significant value to a home's energy
    needs.
        Photovoltaic technology adds value to the nation's energy mix.
    Photovoltaic solar cells are a versatile electricity technology that
    can be used for any application, from the very small to the very large.
    It is a modular technology that enables electric generating systems to
    be incrementally built to match growing demands. It is a technology in
    which systems are easy to install, maintain, and use. And it is a
    convenient technology that can be used anywhere there is sunshine and
    that can be mounted on almost any surface, from rooftops, to roadsides,
    to mobile units, virtually anywhere there is sunshine.
        Photovoltaics (PV) also offer additional benefits. For example, PV
    presents a domestic reserve of energy that will never be depleted and
    makes the U.S. less vulnerable to international energy politics and
    volatile fossil fuel markets. Photovoltaic solar cells are made from
    materials, such as silicon, which are domestically abundant.
        Finally, PV systems produce no greenhouse gases, so their use can
    help offset carbon dioxide emissions and their possible consequences.
    Consequently, building a photovoltaic infrastructure would provide an
    insurance policy against global warming and climate change.
        With so many positive attributes, photovoltaic energy is clearly a
    valuable natural resource.
        Question. The United States is not alone in solar cell development.
    Can you compare the budgets and progress of our efforts in this country
    with solar cell research and development programs in Europe and Japan?
        Answer. The European and Japanese R&D programs are very strong and
    aggressive, resulting in a recent upsurge of competition to the U.S.
    photovoltaic industry. The Japanese budget alone is over three times
    the U.S. R&D budget in fiscal year 1999 ($230M vs $72.2M). Both the
    Japanese and German governments spend hundreds of millions of dollars
    on subsidies for their residential roof programs, which have
    dramatically increased sales for their industries. For example,
    Japanese PV manufacturers reported shipment increases of 41 percent,
    from 35 megaWatts in 1997 to 49.2 megawatts in 1998. In the same time
    period, U.S. shipments rose only 5 percent, from 51 megaWatts in 1997
    to 53.7 megaWatts in 1998. If this trend continues, Japan may well
    surpass the U.S. next year and become the world leader, a position the
    U.S. has held since 1993. Overall, in both the U.S. and in foreign
    countries, the efficiency of commercial solar cells has increased by
    about 30 percent in the last 20 years. However, production costs have
    steadily fallen I all countries, so that the cost per unit power ($/
    Watt) is now about \1/4\ of what it was 20 to 25 years ago.

                    1999 PHOTOVOLTAIC R&D BUDGETS BY COUNTRY
                            [In thousands of dollars]
    ------------------------------------------------------------------------
                                               United
                                               States     Japan     Germany
    ------------------------------------------------------------------------
    Total R&D Program.......................    72,200    230,000    180,000
    Million Solar Roofs \1\.................     1,500    130,000    100,000
    ------------------------------------------------------------------------
    \1\ Japan has a residential solar roof program that installs 10,000 PV
      roofs per year which subsidizes one third of the cost of the PV
      system, and Germany just approved a six-year, 100,000 PV roof program
      to be funded at one billion Marks, or $600M.

                        WORLD PV CELL & MODULE SHIPMENTS
                                      [MW]
    ------------------------------------------------------------------------
                                                              1997     1998
    ------------------------------------------------------------------------
    United States.........................................     51.0     53.7
    Japan.................................................     35.0     49.2
    Europe................................................     30.4     30.1
    Rest of World.........................................      9.4     18.7
                                                           -----------------
          4Total..........................................    125.8    151.7
    ------------------------------------------------------------------------

                       providing dispatchable solar power
        Question. Solar power is produced only when the ``sun is shining''
    so that some means of providing power after sunset must be developed.
    What concepts and research efforts are being developed to solve this
    dilemma?
        Answer. Both the Photovoltaic (PV) and Concentrating Solar Power
    (CSP) Programs at the Department are pursuing various methods of
    harnessing the sun's energy for use after sunset. This ability to
    dispatch solar power when it is needed greatly enhances the economic
    value and broadens the application of solar technologies.
        The simplest and most practical approach for PV energy storage is
    by using batteries. The battery of choice is the deep-cycle flooded
    lead-acid battery. Other battery types are being investigated,
    particularly nickel-cadmium batteries for use in inaccessible
    environments (e.g., microwave repeater stations on mountain tops).
    These batteries are more expensive but have a longer lifetime and less
    sensitivity to deep discharge. Most stand-alone PV systems use flooded
    lead-acid batteries for energy storage. R&D is being conducted to
    improve the integration of batteries with PV to optimize system
    performance and battery life. Other storage research is focused on
    improved batteries and advanced storage technologies (e.g. flywheels)
    that are lower cost, longer life, and more robust in the rigorous
    standalone application environment. In longer-term R&D, energy storage
    through the electrolysis of water and subsequent production of hydrogen
    is being investigated. After sunset, the hydrogen can be combined with
    oxygen in the air to yield electric power through a fuel cell.
        Another concept to eliminate the need for storage in some
    photovoltaic applications is to tie the PV system to the utility power
    grid. When the sun is out, the PV system provides power to the
    application, such as a home or business. If there is excess electricity
    being produced by the PV system, the solar system will run the utility
    meter backwards and the user gets credit for the electric power
    delivered to the grid. At night, the home or business is powered by the
    grid, thus eliminating the need for storage batteries. In this sense,
    the utility grid is the storage.
        For CSP technologies--dishes, troughs, and towers--there are
    different approaches depending on the type of system. Because CSP
    systems generate heat to produce power, all three technologies may be
    hybridized with fossil fuels (e.g., diesel fuel for dishes; natural gas
    or coal for troughs and towers). The 354 MW of trough plants operating
    in the California desert are a fine example of a solar/natural gas
    hybrid system. For stand-alone CSP systems, one option under
    investigation is a solar dish/hydrogen fuel cell combination, where the
    high-temperatures generated by solar dish systems produce power during
    the day and electrolyze water to produce hydrogen for use in a fuel
    cell to provide power at night. Like PV, dish systems can also use
    conventional battery storage. While efficient thermal storage is being
    considered for trough technology. This storage mechanism has been
    successfully demonstrated for power tower systems using molten-salt
    technology. In a test last summer, Solar Two produced power for 153
    consecutive hours (over 6 days) using only sun and salt.
                            solar power vs. storage
        Question. Is energy storage technology ahead of solar power
    technology, or is solar power ahead of storage?
        Answer. An argument could be made that solar power systems are more
    commercially developed than efficient storage methods for kW-scale
    power. This is due to the expense and (in the case of lead-acid
    batteries) the relatively short life of deep-cycle batteries. However,
    energy storage in PV systems today makes use of commercially available
    battery technologies that are produced in large-scale for solar and
    many other applications. Both PV and energy storage technologies have
    made significant advances in recent years in terms of cost reduction
    and improved life. Improved durability of batteries continues to be
    researched while large-scale manufacturing processes are being
    developed for PV. Better system integration of these technologies is
    another focus of research that is expected to pay large dividends in
    the coming years.
             locations receiving federal r&d funds for solar power
        Question. Solar power production is more effective in some areas of
    the country than in others. Do you think there is any relationship
    between the areas of most valuable solar resource and locations of
    Federal R&D in solar power?
        Answer. In the case of both solar photovoltaic and concentrating
    solar power, there is a close relationship between areas of high yearly
    insolation and the location of R&D facilities. Although photovoltaic
    systems have been tested in many sites all across the country and under
    almost all environmental conditions, all five research facilities
    within the Photovoltaic Program are located in areas of high
    insolation. The National Renewable Energy Laboratory (NREL) is located
    in Denver, Colorado; Sandia National Laboratories is located in
    Albuquerque, New Mexico; the Southwest Technology Development Institute
    is located in Las Cruces, New Mexico; the Photovoltaics for Utility
    Scale Applications (PVUSA) test site is located in Sacramento,
    California; and the Florida Solar Energy Center is located in Cocoa,
    Florida. The first four facilities are located in dry, very sunny
    areas, and the last facility is located in a sunny, but very humid
    area. The CSP Program uses the labs at Sandia and NREL (combined to
    form ``SunLab'') and has directed most of its R&D efforts in the U.S.
    Southwest where the solar radiation is ideal for CSP systems.
              locating solar r&d in areas of high solar radiation
        Question. Can you make a case for co-location of solar technology
    test and evaluation in areas of maximum solar power potential?
        Answer. As stated above, in the case of both solar photovoltaic and
    concentrating solar power, there is a close relationship between areas
    of high yearly insolation and the location of R&D facilities. Most of
    the R&D funded by both the PV and CSP Programs is conducted in the U.S.
    Southwest. Though more so for CSP than for PV technologies, co-locating
    solar technology test and evaluation in areas of high solar radiation
    allows for optimal test results and more closely emulates the
    environment where these technologies will be used in commercial
    applications.
                                hydrogen program
        Question. What are the expected benefits of systems that are
    powered by hydrogen?
        Answer. There are multiple benefits that are accrued by using
    hydrogen fuel cells. Hydrogen fuel cells are expected to improve the
    efficiency of energy systems by making more productive use of energy
    resources that protect the environment and enhance national security.
    For electric generation systems, the hydrogen fuel cell can be better
    integrated at the site of electric power utilization as a distributed
    system that can provide both electricity and heat, and thereby achieve
    an overall efficiency of 80 percent. For transportation applications in
    non-attainment areas there would be a significant improvement in the
    air quality due to the fuel-cell exhaust being primarily water. Also,
    natural gas or renewable/electrolysis of water can be substituted for
    petroleum as the source of hydrogen, which would decrease global
    warming emissions and decrease the Nation's reliance on imported oil.
        Question. The deployment of a ``hydrogen infrastructure'' is
    frequently referred to as a major obstacle to hydrogen-powered
    vehicles. What is the Federal Government's role in overcoming this
    obstacle? What are your plans and progress for developing a hydrogen
    infrastructure?
        Answer. There are several barriers that need to be overcome in
    order for the public to accept hydrogen-powered vehicles. There is an
    issue associated with the establishment of a sufficient number of
    hydrogen stations that can dispense a fuel at competitive prices to
    today's petroleum-based fuels. There is also the need to provide the
    cost for the infrastructure to support those stations. The Department
    has issued a solicitation for a refueling station in Las Vegas, NV that
    will co-produce electricity from a stationary fuel cell and hydrogen
    for dedicated vehicles. It is expected that this option will lower the
    cost of both producing the electricity and the hydrogen fuel to levels
    that will enhance the commercial deployment. As a distributed system
    that uses natural gas as the feedstock, it is expected to have a lesser
    impact on supporting infrastructure requirements. As advanced reformer
    and fuel cell technology becomes available from 2001 to 2004, future
    refueling stations will be considered as cost-shared joint ventures
    with industry.
        In addition, there is the need to ensure that the public will be
    able to fuel their vehicle safely and in a reasonable amount of time.
    The Department is working with the industry, the National Hydrogen
    Association and the International Safety Organization on the
    development of an appropriate set of codes and standards. The
    Department is also supporting the development of safety plans and
    testing for projects, and the deployment of pre-commercial systems in
    public environments. It is expected that the automobile industry will
    first develop hydrogen fuel cell buses and fleet vehicles for niche
    markets that will facilitate further deployment of these systems in the
    marketplace prior to requiring an infrastructure to support the general
    public's personal vehicles.
        Question. Fiscal year 1999 Appropriations for hydrogen research
    directed completion of a facility in Nevada that would produce and
    store hydrogen and use a path-breaking fuel cell to supply power. What
    is the status of that facility?
        Answer. A solicitation was issued on March 18, 1999 with a closing
    date of May 14, 1999 for a 50/50 cost-shared project to build and
    operate a 50 kW stationary fuel cell electric generation system and
    hydrogen/natural gas quick-fueling station at a site near the Nevada
    Operations Office in northern Las Vegas. It is expected that this
    station will be built and operational by September 30, 2000.
                                nevada test site
        Question. Nevada is primed and ready for implementation of
    alternative energy resource facilities. A majority of the State is
    Federally owned and unsettled. Additionally, the Nevada Test Site is
    available for use. What are your plans for constructing facilities or
    using existing facilities in Nevada?
        Answer. As you have asserted, Nevada is blessed with numerous
    renewable energy resources and is primed for the use of alternative
    energy resources. To facilitate the increased use of solar energy in
    Nevada, the Office of Power Technologies awarded a $183,000 grant to
    the Corporation for Solar Technology and Renewable Resources (CSTRR)
    September 1998. CSTRR joined with Pulte Home Corporation to develop a
    strategy for the wide scale installation of solar water heating systems
    in Nevada and Arizona. To help them, they formed a team which includes
    Nevada Power Company, University of Nevada Las Vegas , University of
    Nevada Reno, and the Nevada State Energy Office. The team augmented the
    DOE grant with $297,000 of its own. Through this grant, they have
    evaluated a number of solar water heaters and selected two systems that
    best fit Pulte's performance and reliability requirements. They have
    been integrated into the design of Pulte's homes and have been
    installed on several model homes in Las Vegas. Educational materials
    are being developed by Pulte, as is a marketing strategy. Las Vegas'
    abundant solar resource and rapidly growing population makes it an
    ideal location to show that solar technology can be an inexpensive
    energy option. The goal of the project is to develop a sustainable
    market that results in solar water heaters on thousands of buildings
    and facilities throughout Nevada and the rest of the Southwest.
        Within the Photovoltaic Program, the State of Nevada is a Million
    Solar Roofs (MSR) partner and has made a commitment to install up to
    10,000 solar roofs. The Photovoltaic Program is also providing
    financial support to several utility companies within the state to
    install grid-tied PV systems. UtiliCorp United and the Nevada Power
    Company are teaming on a project to install kW PV systems on residences
    to examine their contribution to voltage stability, harmonics and power
    quality. Sierra Pacific Power is part of a team led by Central and
    South West Services to purchase in volume and install 180 PV powered
    fluid handling systems. Finally, the Corporation for Solar Technology
    and Renewable Resources (CSTRR) is located in Las Vegas and the Program
    has worked with CSTRR to identify PV projects in Nevada.
        In the area of the Geothermal Energy Program, today there are 14
    power plants in Nevada with a capacity of about 208 MW. Using current
    technology and known resources Nevada has a potential of up to 500 MW,
    although there are no known plans to commercially develop these
    additional resources. Two geothermal power companies, Oxbow Geothermal
    and Ormat are headquartered in Reno and Sparks, respectively. Both
    companies have major projects within Nevada, and the Department has
    partnered with them in developing improved geothermal technology. In
    addition, there are 80 MW thermal installed at 34 sites for direct use
    applications such as space heating and industrial processes. Another 31
    sites have a potential for development of almost 1400 MW thermal,
    mainly for space heating.
        The State of Nevada may also be a candidate for an alternative
    energy test bed to assess various renewable energy and power delivery
    technologies, especially in a distributed power mode. DOE is
    considering development of such a site through a competitive process in
    the fiscal year 2001 time frame.
               ranking the value of major renewable technologies
        Question. Looking into the future, can you rank in order the
    overall value of the major renewable technologies?
        Answer. Unfortunately, there are too many variables to look into
    the future to rank the overall value of the major renewable energy
    technologies in any meaningful way at this time. Factors such as
    domestic market utilization rates, the level of international sales of
    domestically-produced technologies, private sector investment, consumer
    preferences, the value of environmental (e.g., emission) benefits,
    foreign competition, foreign market barriers and subsidies, resource
    availability, and the great variances among emerging State laws and
    regulations make such rankings essentially impossible.
        Certainly, it appears that some technologies will enter the
    marketplace in a substantial manner sooner than others, but this is not
    an accurate indicator of their eventual value ranking. In fact, this
    would merely be an estimate of market penetration and the cumulative
    benefits provided at a given point in time. Other technologies may
    require a somewhat longer research and development process, but may
    eventually be more suitable to wider market penetration and greater
    overseas sales and thus surpass their market entry predecessors.
    Finally, while oftentimes the various renewable technology resources
    complement each other (e.g., when the sun goes down, the wind
    oftentimes increases, yielding opportunities for hybrid renewable
    energy technology supply systems), there may well be some level of
    competition among the technologies in certain geographic regions that
    will be decided by consumers and the marketplace itself.
                     use of hydrogen and hydrogen research
        Question. You say your mission hasn't changed and that it includes
    developing energy technology options. My understanding is that your
    office is pursuing the use of Hydrogen as an optional technology.
    Efficiency requires coordination with the Energy Efficiency and
    Renewable Energy Office. What steps are you taking to ensure that
    appropriate communication is taking place between your staff and Dr.
    Reicher's staff?
        Answer. I agree that coordination between the Office of Science
    (SC) and the Office of Energy Efficiency and Renewable Energy (EE) is
    critical. The largest activity that supports hydrogen research within
    the Office of Science is in the Energy Biosciences subprogram of the
    Basic Energy Sciences program. In addition to one-on-one meetings
    between program managers, there are several other coordination
    activities. For example, one of our program staff has served as a
    reviewer of the EE Hydrogen program; and currently, the Director of our
    Energy Biosciences Division participates in the Office of Energy
    Efficiency and Renewable Energy's Bioenergy Energy weekly staff
    meetings, thus providing both EE and SC with unique perspectives of
    each others problems and opportunities.
        Question. What do you see in the future for Hydrogen Technologies?
    Are we looking at decades of research before this technology becomes
    effective and efficient?
        Answer. Hydrogen can be used by many energy technologies, from
    combustion to fuel cells. The impediments are, however, two fold. The
    first is one of infrastructure. Our fuels infrastructure is based on
    transporting and distributing hydrocarbons. This infrastructure depends
    on pipelines and trucks eventually leading directly to our homes and
    places of work for heat or distribution centers. Much of this
    infrastructure, perhaps even the majority, is not suitable to handle
    hydrogen safely. The second is one of efficiency in production of
    hydrogen. There are current technologies for converting hydrocarbons to
    carbon dioxide and hydrogen. However, they are not yet economically
    competitive. There are some new ideas being developed and explored both
    at university and government laboratories and in industry that have the
    potential to solve this problem. Longer term research is going to be
    needed to enable the splitting of water as a source of hydrogen using
    solar energy, either by artificial or natural photosynthetic processes.
        Question. What amount of the fiscal year 2000 budget request within
    Energy Research will be directed to hydrogen research?
        Answer. The Office of Science is responsible for broad support of
    the science base for all the technology offices within the department.
    The mechanism by which this is accomplished is competitive peer review
    of all applications. In fiscal year 1998, we provided $2.3 million in
    support of meritorious applications for research on hydrogen. In fiscal
    year 1999, we are currently providing $2.2 million and have received
    applications in the Climate Change Technology Initiative (CCTI) that
    are relevant to hydrogen. Because the review of the CCTI applications
    has not been completed, it is not possible to provide an exact number
    for fiscal year 1999. The same is true for fiscal year 2000. There will
    be a solicitation in fiscal year 2000 for the CCTI that will address
    among other relevant issues, hydrogen. In addition, applications
    relevant to hydrogen are submitted to the base programs; and selection
    is done on the basis of peer review. The amount that will be funded in
    fiscal year 2000 will depend on the applications submitted and the
    outcome of the peer review. We anticipate the fiscal year 2000 funding
    will approximate the fiscal year 1999 funding.
                       objectives of strategic plan goals
        Question. I see that the objectives of your ``Fueling the Future''
    and ``Protecting our Living Planet'' goals are to 1) find energy
    systems that are more efficient and environmentally sound and 2) to
    determine how our energy use affects environmental systems. Will you be
    addressing the environmental issues of nuclear energy, especially waste
    management and disposal, as a part of these?
        Answer. The Office of Science will soon release its new Strategic
    Plan to guide its research through the next 25 years. Much of this
    research, because it is basic, has broad potential applications, some
    presently understood and some not. Having said this, there are areas of
    basic research which will have relevance and benefit for nuclear waste
    management and disposal. For example, programs in materials sciences
    will investigate materials used to contain waste (such as metals,
    glasses, ceramics and polymers), and the corrosion, welding properties,
    fracture behavior, and radiation resistance of such materials. Chemical
    Sciences projects will explore the molecular level reactions of
    actinide compounds necessary for the safe handling, storage, and
    disposal of radioactive wastes. Geoscience investigations will examine
    the transport of contaminants in porous media and the transformation of
    wastes by the subsurface environment. And, programs in plant and
    microbial sciences will study how these biological systems interact
    with nuclear waste products, leading to potentially new or improved
    remediation strategies and technologies.
                  nuclear waste projects in the budget request
        Question. The budget request includes $411.2 million for Biological
    and Environmental Research and $342.9 million for Nuclear Physics. Are
    any of these projects focused on storage of nuclear waste?
        Answer. There are no projects in the budget request for either of
    these programs that are focused on storage of nuclear waste.
                    accelerator transmutation of waste (atw)
        Question. I understand that there are feasible techniques to reduce
    the hazardous lifetimes of radioactive wastes. Is your Office doing
    research on these techniques ?
        Answer. The Office of Science is not doing research on these
    techniques directly, but accelerator technology developed by the Office
    of Science, et al, is the focus of a $4 million DOE R&D roadmap for one
    of these techniques: the accelerator transmutation of (radioactive)
    waste (ATW). The roadmap is due to be completed and submitted to
    Congress by October 1, 1999. The effort is being led by the DOE Office
    of Civilian Radioactive Waste Management (RW), with participation by
    the DOE Offices of Defense, Nuclear Energy and Science. Four technical
    working groups have been formed, in addition to a group of
    international experts.
              oversight of major construction research facilities
        Question. Isn't the Office of Science responsible for providing
    research and oversight of major construction of research facilities? Do
    you have plans for constructing facilities or using existing facilities
    in Nevada?
        Answer. The Office of Science is only responsible for the
    construction oversight of Office of Science funded research facilities.
        The BER Program is currently supporting a research project that is
    using the Desert Free Air Carbon Dioxide Enrichment (FACE) facility.
    The project, ``Effects of Elevated CO2 on Root Dynamics and
    Root Function in a Mojave Desert Ecosystem,'' is undergoing peer review
    for continued support. The site is located outside of Las Vegas,
    Nevada, at the Department of Energy's Nevada Test Site.
                        competitiveness of nuclear power
        Question. You say that nuclear energy is essential in reducing
    carbon dioxide emissions. There are many other ``green'' technologies
    that could also reduce carbon dioxide emissions. At this time, these
    other technologies are not competitive on the open market. My
    impression is that nuclear energy is also not competitive on the open
    market. No new reactors have been built in more than 20 years. Many of
    the old reactors are being decommissioned.
        Public distaste for nuclear power incurs hidden costs that can be
    offset only by real reductions in capital and operating expenses for
    nuclear power facilities. Otherwise, the industry will continue to turn
    to other opportunities. How do you plan to decrease the costs
    associated with nuclear energy (including waste disposal) in order to
    make it competitive on the open market and attract industrial power
    advocates?
        Answer. Nuclear power plants are among the most efficient sources
    of baseload electricity available today, with operating costs averaging
    at about 1.9 cents per kilowatt-hour. Rather, the unacceptably high
    costs historically attributed to nuclear power plants are from the high
    costs and long lead times associated with construction and licensing of
    these plants. Since the enactment of the Energy Policy Act of 1992,
    much has changed that would make economics associated with building and
    operating new plants more economic. We believe that nuclear energy is
    and will continue to be an important source of electricity for the
    nation and with the right strategies by industry and government to
    address barriers to use of nuclear energy, both existing and new
    nuclear plants will be competitive with other energy sources in the
    next century.
        A few years ago, with the shut down of several older, smaller
    nuclear power plants, and with electricity restructuring looming, many
    believed that existing nuclear power plants could not compete in the
    electricity supply market. However, this has not proven to be the case.
    Today, the trend is toward consolidation of ownership of nuclear plants
    as states favorably address stranded costs, as we see a growing
    recognition of the importance of nuclear to meeting international
    commitments on climate change, and as we see that these plants can be
    operated efficiently, reliably, and safely. Already, several plants are
    proceeding well ahead of schedule with license extension and others
    have expressed their intent to proceed with license extension. We
    believe that the majority of existing plants will continue to operate
    well into the next century. To support their continued operation, the
    Department is proposing to launch the Nuclear Energy Plant Optimization
    (NEPO) program, in fiscal year 2000. With a modest level of funding,
    leveraged with industry funding, we believe we can begin addressing
    important issues that can remove barriers to extended operation of the
    existing plants. This program conducted in at least 50-50 cost-shared
    cooperation with the Electric Power Research Institute (EPRI) and with
    coordination with the Nuclear Regulatory Commission (NRC), would seek
    to increase plant capacity from 71 percent in 1997 to 85 percent in
    2010 by addressing issues such as materials degradation, plant aging,
    and other issues affecting plant reliability, economics, and safety.
        In the 1980's and mid-1990's the Department and industry funded and
    completed, the Advanced Light Water Reactor (ALWR) program. This
    program is the foundation for restoring favorable economics and
    increased confidence in nuclear power in the United States. Three
    improved, simplified U.S. plant designs were submitted for NRC Design
    Certification in cooperative, cost-shared programs of DOE and the U.S.
    industry: the General Electric Advanced Boiling Water Reactor (ABWR)
    and ABB-Combustion Engineering System 80+ large plants (1350 MWe), and
    the smaller Westinghouse AP-600 (600 MWe) simplified passive plant. The
    ABWR and System 80+ received NRC Design Certification in May 1997. The
    AP600 received NRC Final Design Approval in September 1998, and should
    receive Design Certification in 2000. We believe that design
    certification, coupled with the latest NRC one step licensing process,
    reduces the uncertainty and risk that characterized many nuclear plant
    projects in the 1970's and 1980's. In addition, the significant
    improvements and simplification of these plant designs, will reduce the
    time and cost required to construct nuclear power plants.
        In fiscal year 1999, with advice from the President's Committee of
    Advisors on Science and Technology, the Department proposed and
    Congress funded $19 million for the Nuclear Energy Research Initiative.
    This program is specifically aimed at conducting new and innovative
    research to address barriers to long term use of nuclear energy, such
    as waste, proliferation, and economics. As an investigator-initiated,
    peer reviewed research program, proposals were solicited from
    universities, national laboratories, and industry in the following
    general areas:
      --Proliferation resistant reactor and fuel technology
      --New reactor designs to achieve improved performance, higher
            efficiency and reduced cost; also, low output power reactors.
      --Advanced nuclear fuels
      --New technologies for nuclear waste management
      --Related fundamental science and technology.
        We received over 300 proposals in response to the solicitation and
    in May 1999, the Department awarded grants to the top 45 research
    projects. The majority of these awards were for collaborative research
    among universities, laboratories, and industry, including significant
    collaboration with international R&D organizations. The NERI program is
    expected to produce significant innovative research and development
    that will contribute to the reduction of nuclear plant costs and
    construction schedules and to improvements in proliferation resistance,
    nuclear waste technology, and other promising areas of nuclear energy
    development.
        In the final analysis, the long-term use of nuclear power in the
    United States will depend on economics. This in turn will depend on the
    efficacy of the R&D that is conducted, on demonstrating the benefits of
    nuclear power, and on restoring and maintaining a sufficient
    infrastructure of the needed technical qualifications in industry,
    universities and laboratories.
         nuclear energy research initiative waste management activities
        Question. It is the focus of Nuclear Energy Research Initiative
    (NERI) to determine how, if possible, nuclear energy can be used over
    the long term as an environmentally responsible and reliable energy
    source. You are requesting an increase of $6 million over fiscal year
    1999 funding to address obstacles affecting the future of nuclear
    energy in the U.S. Do these obstacles include nuclear waste management
    and storage?
        Answer. Yes. Nuclear waste, principally spent fuel is one of the
    five main research areas of the fiscal year 1999 NERI research program.
    The focus of the NERI nuclear waste research is to address issues
    related to the management and interim or onsite storage of commercial
    spent fuel. The fiscal year 1999 NERI research solicitation identified
    waste research needs in the following specific areas: new concepts for
    on-site or interim storage of spent fuel; strategies and technology for
    the reduction of high level waste volume; and fundamental research to
    eliminate storage corrosion processes. The NERI nuclear waste research
    effort is being coordinated with other Department offices including the
    Offices of Civilian Radioactive Waste Management, Science, and
    Environmental Management to avoid duplication of research.
        Question. How will these additional funds be used to address waste
    disposal uncertainties?
        Answer. The Office of Nuclear Energy, Science and Technology plans
    to utilize approximately $19 million of the requested $25 million in
    fiscal year 2000 to fund the second year of the R&D proposals awarded
    in fiscal year 1999. The additional $6 million will be used to fund new
    research in several key areas, including nuclear waste management,
    proliferation resistant reactor and fuel technologies, new reactor
    designs, and advanced nuclear fuels. The Department is seeking new
    alternatives and technological solutions to minimize the impact of
    spent fuel-nuclear waste while maintaining compatibility with the
    policy for ultimate disposal in a geological repository. NE will select
    and fund the best scientific and engineering research proposals
    received from U.S. universities, national laboratories and industry
    based on a competitive, peer reviewed selection process.
                 nuclear energy--social acceptability and cost
        Question. How will the Department address what could be the two
    biggest obstacles to nuclear energy--social acceptability and cost?
        Answer. The Department recently completed the Advanced Light Water
    Reactor Program (ALWR) which produced three advanced nuclear power
    plant designs that have been approved by the Nuclear Regulatory
    Commission (NRC). The General Electric Boiling Water Reactor (ABWR) and
    the ABB-Combustion Engineering System 80+ received NRC Design
    Certification in May 1997. Design Certification of the Westinghouse
    AP600 is expected in 2000. These ALWR designs have made significant
    advancements in the already robust safety features and life cycle cost
    aspects of nuclear energy.
        In order to keep the nuclear energy option viable for the United
    States, the Department has proposed in its fiscal year 2000 budget,
    research and development activities under the Nuclear Plant
    Optimization (NEPO) program. NEPO is a new initiative proposed in
    fiscal year 2000, to cooperate with the industry to develop key
    technologies that can help assure the long-term viability of our
    nation's existing nuclear power plants. This initiative is particularly
    important as utilities deal with uncertainties associated with
    electricity restructuring. NEPO seeks to develop and apply new
    technologies to improve plant economics, reliability and availability,
    and resolve issues related to plant aging while maintaining a high
    level of safety.
        The proposed NEPO program would help reduce the production costs of
    existing plants because the R&D conducted: (1) would provide a better
    understanding of material degradation mechanisms and how they occur,
    enabling development of cost-effective aging management strategies
    which will provide capabilities to easily prevent, detect, or repair
    the degradation; (2) would improve equipment reliability, lower
    operating costs, and increase power output while maintaining high level
    of safety; and (3) would optimize power generation through efficiency
    and productivity improvements by making use of technology advancements
    in computers, communications, materials, sensors, digital electronics,
    and artificial intelligence.
        Nuclear energy can become competitive for new capacity additions,
    if its capital costs can be reduced. Reduction in capital costs can be
    achieved through the application of advanced technologies in all phases
    of design, licensing, fabrication, construction and operation; through
    the use of tools such as probabilistic risk assessment to simplify
    designs; and by the application of risk-based regulations as a means to
    streamline the regulatory requirements and process. NERI focuses in
    part on developing technologies which would make the option of nuclear
    energy more competitive in the future.
        The NERI program, which was initiated this year, will address the
    principal obstacles to expanded future use of nuclear energy--
    proliferation, economics and nuclear waste management. NERI research is
    focused on improved proliferation-resistant reactor and fuel
    technologies; new reactor designs and technologies to improve
    efficiency, enhance safety and reduce cost; advanced nuclear fuels to
    improve fuel economics and reduce waste by-products; and new
    technologies to manage and temporarily store spent nuclear fuel. NERI
    complements NEPO by addressing our nation's long term nuclear energy
    future by funding investigator initiated research and development at
    universities, national laboratories, and industry to advance nuclear
    power technology.
          nuclear energy research initiative and nuclear energy plant
                              optimization funding
        Question. I am impressed that NERI and the Nuclear Energy Plant
    Optimization (NEPO) program are so successfully coordinating with
    outside industry, national labs, and universities. Where do the Federal
    dollars allocated to these programs go?
        Answer. There was an overwhelming response by the science and
    technology community to the fiscal year 1999 NERI solicitation; 308
    researcher-initiated R&D proposals were received from 68 different
    institutions including 40 universities, 9 national laboratories and 19
    industry companies totaling over $100 million in first-year funding and
    a total of $353 million for the three-year period. Over 210 of the
    proposals involved collaborations among several R&D institutions,
    particularly with universities, to foster and maintain a nuclear energy
    R&D infrastructure. In May 1999, the Department selected the top 45
    projects for award of fiscal year 1999 funding. The projects selected
    will involve 21 universities, 8 national laboratories, 16 private
    sector organizations and with a substantial level of interest and
    collaboration with international R&D organizations. Funding for NERI is
    used to fund new and innovative research at the universities, national
    laboratories and industry.
        The proposed NEPO program would involve the nation's national
    laboratories, universities, and industry in addressing issues
    associated with operating nuclear power plants in cost-shared
    cooperation with the Electric Power Research Institute (EPRI) and in
    coordination with the Nuclear Regulatory Commission (NRC). The research
    and development program is cost-shared with industry providing a
    minimum of 50 percent of the cost. The Department, national
    laboratories, and EPRI have developed a Joint DOE-EPRI Strategic
    Research and Development Plan to Optimize U.S. Nuclear Power Plants.
    This plan was issued on March 20,1998 and was based on inputs from the
    national laboratories, NRC, universities, and other key stakeholders.
    This plan, which will be updated in fiscal year 1999, identifies
    critical R&D needs which are not currently being addressed or planned
    to be addressed by the industry, NRC, or others. The plan also defines
    a process for selection of the highest priority projects based on
    available funding. Project selection will be guided by the Nuclear
    Energy Research Advisory Committee (NERAC). The federal dollars would
    fund the organizations which are best suited to conduct the research
    and development selected for funding. It is expected that efforts at
    national laboratories, universities, and industry will be funded.
        Question. Are they provided as grants to universities and national
    labs?
        Answer. NERI awards to universities and industry will be in the
    form of grants or cooperative agreements. Funding for the national
    laboratories will be provided using the standard DOE work authorization
    process.
        The proposed NEPO program is a collaborative cost-shared program
    with industry providing a minimum of 50 percent of the cost. The
    government and industry, through EPRI, will identify and prioritize
    work and use an independent peer review process to select performing
    organizations. We expect that universities, national laboratories and
    industrial organizations will all be involved in NEPO R&D activities.
        Question. Are any of these funds provided to Nevada researchers?
        Answer. Selection of proposals for funding was completed and awards
    were announced in May 1999. Although no proposals were submitted from
    researchers in State of Nevada, there is substantial nuclear-related
    expertise in Nevada, at the universities and industry, and we look
    forward to receiving future proposals from your State for participation
    in NERI, and if appropriated by Congress in fiscal year 2000, for
    participation in NEPO.
                                     ______

                     Questions Submitted by Senator Stevens

                       low income weatherization program
        Question. The Department of Energy's Office of Energy Efficiency
    and Renewable Energy focuses its research, development, and deployment
    efforts on transportation, industry, buildings and the federal
    government. In transportation, DOE focuses on cleaner fuels and great
    fuel efficiencies. It has highlighted nine industries that account for
    more than 75 percent of industrial energy use, including forest
    products, petroleum refining, and mining. For buildings, DOE tries to
    reduce the $220 billion of energy consumed in homes and offices each
    year through R&D in lighting, heating, cooling, and ventilation, as
    well as better construction practices and energy delivery systems.
    Through the Federal Energy Management Program, DOE seeks to reduce the
    $8 billion the federal government spends annually on energy through
    cost-saving incentive programs. The President has proposed a 3.4
    percent reduction from fiscal year 1999 in the energy conservation
    budget.
        The fiscal year 2000 weatherization assistance program will provide
    federal assistance to more than 76,900 low-income homes. There are
    Alaskans living in third world conditions above the Arctic Circle who
    pay more than 50 cents per kilowatt hour for energy. In much of my
    state, more than half of a family's annual income goes to energy in
    much of my State. Is this program scaled towards those poor families
    with the lowest incomes AND with the highest energy costs?
        Answer. The mission of the Department of Energy's Weatherization
    Assistance Program is to reduce the energy costs of low-income
    families, especially those with children, persons with disabilities,
    and the elderly, while ensuring their health and safety. Each state's
    annual Weatherization program plan lays out how priorities will be
    determined by the local agencies which perform the weatherization
    service throughout the state. Energy burden is a factor that is
    considered by weatherization agencies in Alaska, in prioritizing homes
    for Weatherization service.
        In Alaska's case, however, many families living in remote areas
    have homes which need far more assistance than is either allowable or
    affordable within the national Weatherization program's legislative
    constraints. Many rural Alaskan homes need major repair or
    rehabilitation before energy efficiency measures make sense.
    Furthermore, the expense of delivering energy efficiency measures to
    these remote communities is so high that the average cost per home far
    exceeds the maximum average allowable under DOE's program, which in
    1999 is $2,032. As a complement to the DOE Weatherization program, the
    state of Alaska provides for these homes by allocating state funds
    (about $3 million in the current year) that can be used for repair and
    rehabilitation as well as energy efficiency improvements. The cost per
    home averages between $5,000 and $14,000. Unlike the DOE funds, there
    is no cap on the amount of state funds that can be used for each
    residence.
                 efficient delivery systems in remote villages
        Question. Your budget proposal includes funding for a number of
    advanced fuel technologies. However, most rural Alaskan communities
    rely on diesel generators for their power. Clean, efficient, modern
    technology is not yet an option for many of these folks. What can your
    agency do to help make the existing energy delivery systems in our
    villages more efficient?
        Answer. Since fiscal year 1996 the Department has been engaged in
    efforts to assist rural Alaskan communities to integrate wind energy
    systems with existing diesel generation units to increase the
    efficiency, and reduce the cost of operating those diesel systems. In
    the village of Kotzebue, for example, approximately $4.5 million of DOE
    funds have been made available to date to install a 1.5 to 2.0 megaWatt
    wind energy system to augment an existing 11.3 megaWatt diesel system.
    When fully operational, the wind energy system at Kotzebue will be able
    to provide as much as 25 percent to 30 percent of annual electricity
    requirements, and reduce diesel fuel costs by a similar 25 percent to
    30 percent figure. The Kotzebue project, with ten 66 kW wind turbines
    currently installed, is serving not only as a model to reduce
    dependence on expensive and difficult to maintain diesel generation
    systems, but also as a ``center of excellence'' to share lessons
    learned with other communities in the state to help them harness wind
    resources available to them. In addition to the Kotzebue project, the
    Department is also supporting a high-penetration 130 kW wind energy
    system at the Village of Wales. This system, to be installed in the
    Summer of 1999, will in periods of high winds have the ability to
    provide all of the electricity required by the village, and will serve
    as a model for wind energy installations in other small villages in the
    state. Further, the Department is working with the Alaska Department of
    Community and Regional Affairs (DCRA) to help the villages of Gambell,
    Mekoryuk, Point Hope, St. Michael, and Unalakleet to perform detailed
    measurements of their wind resources as a first step leading to the
    possible installation of wind energy systems in those communities. In
    support of DCRA the Department also funded a market assessment of the
    potential for wind energy use in approximately 80 rural Alaskan
    communities. DCRA and the Institute for Social and Economic Research at
    the University of Alaska -Anchorage are now analyzing that data to
    determine additional rural communities that might be candidates for
    wind energy installations to augment their existing diesel generation
    systems.
        A multi-year program that was initiated as part of the hydrogen
    program in the fiscal year 1998 budget concerned the development of 3
    to 5 kW fuel cells for residences and buildings that could operate with
    a diesel fuel. The fuel cells can be deployed within or next to the
    building and be used to co-produce heat as well as power. Overall
    efficiencies for these systems are anticipated to be in the 80 to 90
    percent range, and can thereby decrease the fuel requirements by half.
    Also, if several of these systems were to operate in a village
    environment as a distributed network, then it is expected that the
    reserve requirements for backup systems will be less. A demonstration
    of a fuel cell system in an arctic climate is planned to be operated by
    the end of 2000.
        In addition, hybrid systems of diesel generators with batteries
    have been shown to enhance diesel efficiency by as much as 50 percent
    while leveling out fluctuating load patterns. Several such systems are
    being studied along the Alaskan coast in cooperation with Chugach
    Electric and the State of Alaska. Installation and field testing of a
    prototype generator/storage system is scheduled for fiscal year 2001.
        Funded by DOE, a 1.4 MWh energy storage system now operates on the
    remote Metlakatla island in southeastern Alaska. The state-of-the-art
    system is charged by hydropower and is expected to pay for itself
    within three years. The hybrid system eliminates the use of a noisy,
    polluting 3 MW diesel engine and handles large load spikes caused by
    the lumber mill that is also the main employer on the Indian
    reservation. Data collected on the performance of this system could be
    used by other Alaskan sites to improve their power supply and power
    quality situations.
        Finally, in the fiscal year 2000 budget request, the Department has
    asked for funding for a Competitive Solicitation Program (one of the
    two programs in the solar Program Support line item) that could be of
    assistance to communities in Alaska and other states seeking to improve
    their energy delivery systems. (This program is a proposed integration
    of two previous lie items: the Renewable Indian Energy Resources
    Program and the Federal Buildings/Remote Power Program.) Through
    competitive awards, the Department would carry out targeted field
    validation projects that prove the availability of clean, affordable,
    and reliable electric power supply options in remote and/or
    economically challenged areas of our Nation. These projects would not
    only benefit the requirements but also provide essential data on
    operational performance, reliability, and benefits of renewable energy
    and hybrid renewable energy generation/cogeneration systems in various
    geographic locations and climatic conditions.
                                     ______

                     Questions Submitted by Senator Dorgan

                                renewable energy
        Question. Could you comment on the progress being made to make
    renewables competitive relative to other more established fuels. How
    long is it going to take to get a mature technology? I'm especially
    interested in progress with wind.
        Answer. Research and development has significantly reduced the cost
    of producing electricity from renewable resources over the last twenty
    years. For example, in the early 1980's the cost of producing power
    from the first photovoltaic (PV) systems was more than $1.00 per
    kilowatt-hour (kWh), while today's PV technology can produce
    electricity from sunlight at less than a quarter of that cost. By
    fiscal year 2000 we expect PV systems to be able to deliver electricity
    for as low as $0.12-$0.20 per kWh. The cost of electricity from wind
    turbines in 1980 ranged from $0.30-$0.40 per kWh, while today it is
    between $0.04 and $0.06 per kWh. Although many renewable technologies
    are competitive in limited market segments (for example, off-grid
    photovoltaics, biomass where low cost or negative cost waste feedstock
    is available or where cogeneration is appropriate, geothermal where
    there are established high quality resources), they have not yet
    reached the point where they can capture a large share of the overall
    electricity market. Concurrent with the impressive reductions in the
    cost of producing electricity from renewable resources, for a number of
    reasons (including deregulation of the natural gas and oil industries
    and the railroads) the price of fossil fuels has fallen significantly,
    which, together with improvements in conventional power generation
    technology, has lowered the cost targets at which renewable
    technologies become competitive with conventional fuels in a
    significant portion of electricity markets. Assuming success in meeting
    the technology cost and performance goals for our R&D programs--and we
    believe we will continue to be successful and meet these goals--a
    number of the renewable technologies will become competitive in the
    2010 to 2020 time frame. Wind is expected to achieve costs of between
    $0.025 and $0.03 per kWh by 2010, somewhat lower than today's average
    costs for electricity from fossil plants. The cost of electricity from
    photovoltaic systems is projected to be under $0.10 per kWh in 2010,
    decreasing to about $0.065 per kWh by 2020. This should allow
    photovoltaics to be competitive with electricity delivered from the
    grid in at least some retail commercial and residential markets.
        Both technology improvements and market penetration typically
    follow an ``S'' curve, with slow progress initially, followed by
    accelerated developments for a period of time and then, finally, slow
    progress again when the technology matures. Generally it takes decades
    after a technology is introduced into the market place for the
    technology to mature with respect to technology improvements or market
    penetration; however, we expect the Federal R&D role to be completed
    long before the technologies reach ``full maturity'' and that the
    marketplace will provide most of the incentives for incremental
    technology improvements during this ``full motivation'' phase.
                               prospects for wind
        Question. What are the prospects for wind generally, especially in
    remote locations? Do you see a time when wind could help these areas
    reduce their electricity costs?
        Answer. In remote villages without connection to a central grid and
    where the cost of diesel fuel is often one to two dollars per gallon or
    more, use of wind energy appears very competitive. What is still
    necessary is to develop control strategies and retrofit packages to
    join wind power with existing diesel power systems or other
    technologies such as fuel cells. To that end, the Department is working
    on three projects in Alaska to evaluate the performance of wind/diesel
    hybrid systems and to establish the performance of wind turbines in the
    Arctic climate. Moreover, we are proposing an expansion of this effort
    through the Hybrid Systems for Village Power project in the fiscal year
    2000 request.
        Over 800 MW of wind technology will be installed in 1998 and 1999
    in the United States, largely because of the purchaser's desire for
    clean, green energy and because of the temporary production tax credit.
    The pace of wind development for windfarms thereafter depends on a
    great many factors. The Administration has proposed a five-year
    extension of the temporary production tax credit and that would provide
    a major economic motivation to overcome the initial higher cost of wind
    projects. In addition, we would expect wind energy to capture a
    significant share of a renewable portfolio standard if the Congress
    enacts the Administration's proposal. There is also inherent demand for
    green power although we do not have a good handle on its size. For wind
    farm applications, if environmental and other factors are not included,
    the cost of wind energy is not yet competitive with that from new
    natural gas plants. New wind technologies under development will narrow
    the gap between wind and natural gas technologies.
                         co-firing biomass with lignite
        Question. What are the prospects for co-firing biomass with
    lignite? In other words, could biomass be burned along with liginte to
    improve its efficiency and air quality characteristics?
        Answer. The prospects for co-firing biomass with lignite appear
    promising. An assessment of co-firing alternatives was conducted at the
    coal-fired boilers of Central & South West Utilities. One of the
    conclusions drawn from this assessment is that biomass and lignite are
    very similar, in terms of fuel characteristics. There is very little
    difference between the energy content of biomass and the lignite coal;
    lignite generally has a heating value of 6,400 BTU/lb and biomass fuel
    5,000 BTU/lb. Both can be readily fired in coal-fired boilers with
    minimum modifications.
        Question. If current biomass technologies aren't appropriate, do
    you see some other kind of technology that would be compatible with
    lignite?
        Answer. As stated in the previous question, current biomass
    technologies are appropriate for co-firing biomass with lignite. In
    fact, the differences between biomass and lignite are less than those
    between coal and biomass, due to the high moisture content and low BTU
    of lignite relative to coal. In general, lignite has low BTU content
    and an ash that tends more to slag than coal ash and, therefore, is
    fired in boilers with larger size and larger gas flow passages to
    prevent clogging due to the slag. Hence, in some ways the co-firing
    prospects for lignite seem more promising.
        Question. Could co-firing with lignite be done at EERC?
        Answer. We are aware of the Energy & Environmental Research
    Center's (EERC) capabilities in the field of energy, particularly
    fossil energy. We are also aware of the EERC's experimental capability
    to conduct co-firing tests with lignite.

                              subcommittee recess

        Senator Domenici. We stand in recess. Thank you. The
    subcommittee stands in recess.
        [Whereupon, at 11:32 a.m., Tuesday, April 13, the
    subcommittee was recessed, to reconvene subject to the call of
    the Chair.]

        ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2000

                                  ----------

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

                           NONDEPARTMENTAL WITNESSES

        [Clerk's note.--At the direction of the subcommittee
    chairman, the following statements received by the subcommittee
    are made part of the hearing record on the Fiscal Year 2000
    Energy and Water Development Appropriations Act.]
                 CALIFORNIA WATER RESOURCE DEVELOPMENT PROJECTS
     Prepared Statement of Michael D. Madigan, Chairman, California Water
                                   Commission
        The California Water Commission is an official agency of the State
    of California. It is composed of nine representative citizens from
    throughout the State. The Commission is charged by statute with
    representing State of California and local interests before your
    Committee. The Commission is coordinating the filing of the statements
    of a number of State and local agencies. On behalf of the California
    Water Commission, I would like to express our sincere appreciation for
    the support this Committee has given California water, fishery and
    flood control appropriations over the years. I am privileged to submit
    to you the official recommendations of the State of California for
    fiscal year 2000 appropriations and request it be included in the
    formal hearing record along with the testimonies listed on the attached
    Statement List.
        The Commission would like you to know that it supports projects as
    shown on the attached document entitled, California Water Commission--
    Final Recommendations for fiscal year 2000 Federal Appropriations for
    California Water, Fishery and Flood Control Projects, March 5, 1999.
    That document contains recommendations adopted by the Commission at its
    March 5, 1999 meeting in Sacramento, California, where individuals from
    throughout the State testified on individual projects.
        This year the recommended add-ons to the President's budget for the
    Corps of Engineers are not as extreme as last year. However, the
    proposed amounts in some of the large ongoing flood control
    construction projects are inadequate to maintain the construction
    schedule. Stopping and starting construction projects can significantly
    increase the cost, as well as putting the respective project areas in
    jeopardy of severe damage from flooding of a partially completed
    project. The Commission has supported projects over the years that are
    funded under ``Continuing Authorities'', such as Sections 205, 206, 503
    and 1135. These projects compete for very limited funds. This year the
    Commission voted to request Congress consider increasing the funding in
    these Authorities, so more of the needed projects in these categories
    can be funded.
        The California Water Commission has long recognized water recycling
    as an important element in the management of California's water
    resources. It is the Commission's view that water recycling projects
    should be supported in concert, within the limitations of available
    federal funds, giving due consideration to other potential sources of
    funds that could be available to effect their implementation. The
    Commission agreed to work with USBR on language which will give the
    local sponsor greater assurance of future year support. This will also
    encourage sponsors to go ahead with expanded facilities with greater
    expectation of out-year funding.
                       special recommendations for funds
        The Commission recommends that special consideration be given for
    appropriation of funds for projects of the U.S. Army Corps of Engineers
    and U.S. Bureau of Reclamation as shown in the following table. The
    Commission believes that these projects merit special consideration for
    the reasons set forth in the information shown on the tables on the
    following page.

    ------------------------------------------------------------------------
                                                                 CWC final
                                                Presidents    recommendation
     CWC No.        Project and county         budget fiscal    fiscal year
                                                 year 2000         2000
    ------------------------------------------------------------------------
              U.S. ARMY CORPS OF ENGINEERS

          90 Bay-Delta Ecosystem                  $500,000      $1,000,000
              Restoration
         110 Sacramento & San Joaquin            2,000,000       3,000,000
              Rivers Comprehensive Study
         210 American River Watershed            5,000,000       5,000,000
         238 Arroyo Pasajero                       150,000       2,685,000
         302 Sacramento River Restoration        3,000,000       6,000,000
              at Glenn-Colusa Irrigation
              District
         333 Kaweah River (Tulare)          ..............       2,500,000
         381 Los Angeles County Drainage        30,000,000      50,000,000
              Area Project
         382 Santa Ana River Mainstem           20,000,000      28,000,000
         387 Norco Bluffs Bank              ..............       2,200,000
              Stabilization Santa Ana
              River
         400 Flood Control Act of 1948,         26,000,000      50,000,000
              Section 205 Flood Damage
              Prevention
         420 Water Res. Development Act,         4,500,000      10,000,000
              1996, Section 206, Aquatic
              Ecosystem Restoration
         430 Water Res. Development Act,        15,000,000      30,000,000
              1996, Section 503, Watershed
              Mgt. Restoration &
              Development
         440 Water Res. Development Act,         8,500,000      20,000,000
              1986, Section 1135, Project
              Modification for Improvement
              of the Environment Pro-
              gram

               U.S. BUREAU OF RECLAMATION

         500 Bay-Delta Ecosystem                95,000,000      95,000,000
              Restoration
         612 Coleman National Fish               1,500,000       1,500,000
              Hatchery Modification
         621 Winter-Run Chinook Salmon,            520,000         520,000
              Captive Broodstock Program
         622 Hamilton City Pumping Plant         2,250,000       3,750,000
              Fish Facility
             663
             Arroyo Pasajero Studies        ..............         920,000
              Cantua Creek Strm Group-EIS
         701 Central Valley Project             72,617,000      72,617,000
         900 Public Law 102-575, Title XVI       3,000,000       3,000,000
              and Amended by Public Law
              104-266 (Mid-Pacific Region)
        1000 Public Law 102-575, Title XVI      26,100,000      26,100,000
              and Amended by Public Law
              104-266 (Lower Colorado
              Region)
        1108 Salton Sea Research Project         1,000,000       1,000,000
        1302 Title I Division (Lower            13,092,000      13,092,000
              Colorado)
        1304 Basin-wide Program                 12,300,000      17,500,000
    ------------------------------------------------------------------------

                          u.s. army corps of engineers
        CWC 90--Bay-Delta Ecosystem Restoration.--The CALFED Bay-Delta
    Program is an open collaborative, state-federal-stakeholder effort
    seeking to develop a comprehensive long-term plan to restore ecosystem
    health and improve water management for beneficial uses of the Bay-
    Delta system. The Program is developing a comprehensive package of
    Program elements that, together, must:
      --Improve and increase aquatic and terrestrial habitats and improve
            ecological functions in the Bay-Delta to support sustainable
            populations of diverse and valuable plant and animal species.
      --Provide good water quality for all beneficial uses.
      --Reduce the mismatch between Bay-Delta water supplies and current
            and projected beneficial uses dependent on the Bay-Delta
            system.
      --Reduce the risk to land use and associated economic activities,
            water supply infrastructure, and the ecosystem from
            catastrophic breaching of Delta levees.
        The CALFED Bay-Delta Program is a cooperative effort among State
    and Federal agencies and the general public to ensure a healthy
    ecosystem, reliable water supplies, good water quality, and stable
    levees in California's Bay-Delta. The Corps of Engineers is an official
    part of the ongoing effort and needs to be adequately funded to allow
    the Corps' experts to officially participate in CALFED activities.
        CWC 110--Sacramento and San Joaquin Rivers Comprehensive Study.--In
    January of 1997, the Central Valley of California was confronted with
    the largest and most extensive flood disaster in the State's history.
    The Sacramento River and its tributaries sustained two major levee
    breaks. In the San Joaquin River Basin, extensive damages resulted from
    over two dozen levee breaks, sedimentation, and deposition of sand and
    silt in the fields where flood water poured through the levee breaks.
    As a result, Congress appropriated $3 million in fiscal year 1998 and
    $3.5 million in fiscal year 1999 to initiate a comprehensive flood
    damage reduction and environmental restoration assessment for the
    Sacramento and San Joaquin River Basins.
        The State of California and the Army Corps of Engineers have
    initiated a four year Comprehensive Study. The Comprehensive Study will
    build on existing data outlined in investigations such as the
    Sacramento River Watershed Management Plan, the State's San Joaquin
    River Management Program, the Central Valley Project Improvement Act
    (CVPIA), and integrated with these and other existing programs. The
    first phase of the Comprehensive Study is 18 months long. This interim
    report is nearing completion and will be sent to Congress in April of
    1999.
        Phase II will result in full development and calibration of basin-
    wide hydrologic and hydraulic models. Phase II report will include a
    programmatic EIS/EIR which describes a broad range of potential flood
    damage reduction measures and integrated ecosystem restoration
    measures. Some ``early implementation projects'' will be identified,
    developed, and to the extent possible recommended for authorization and
    implementation. Early implementation projects must (1) address
    identifiable flooding problems, (2) be consistent with the strategy,
    (3) be singularly effective in achieving program goals, (4) demonstrate
    broad acceptability, and (5) be readily implementable.
        CWC 210--American River Watershed.--Recently the U. S. Army Corps
    of Engineers said, ``Sacramento has one of the lowest levels of flood
    protection of any U.S. city its size.'' Located at the confluence of
    two major rivers, a large portion of the Sacramento area is threatened
    by flooding from the American River and the Sacramento River. The area
    of risk covers over 100,000 acres and consists of over 160,000 homes
    and structures, 400,000 residents and over $37 billion in developed
    property.
        The Reclamation Board supports at a minimum Congressional
    Authorization of Folsom Dam modifications as part of the Water
    Resources Development Act of 1999. This would increase the level of
    protection from 1 in 77 to about 1 in 110. The Folsom modifications are
    common to all plans currently under consideration by Congress.
        CWC 238--Arroyo Pasajero.--At present, DWR, USBR, and the Corps are
    only a few months away from completion of the Draft Feasibility
    Investigation Report, which will identify two candidate alternatives
    that show a federal interest in a Corps flood control project. The two
    projects, the enlarged Westside Detention Basin and the Pasajero Gap
    Detention Dam, are estimated to cost approximately $260 and $229
    million with benefit cost ratios of roughly 1.7:1 and 1.1:1,
    respectively. While both plans provide significantly improved flood
    protection to the Aqueduct where the overwhelming majority of the flood
    control benefits are accrued, the Gap Dam provides roughly double the
    level of protection to most of the Arroyo Pasajero flood plains that
    cover nearly 100,000 acres within Westlands Water District and the
    Tulare Lake Basin.
        Severe flooding has been experienced five times at the Arroyo
    between 1969 and 1993. On March 10, 1995, during the largest Arroyo
    Pasajero flood on record, a section of Interstate 5 upstream of the
    Canal collapsed when flood flows peaked on the Arroyo. Seven people
    lost their lives and there was substantial local property damage. Flood
    damage claims filed by private landowners adjacent to the Canal have
    exceeded $12 million from this one flood alone.
        CWC 302--Sacramento River Restoration at Glenn-Colusa Irrigation
    District.--Finding a solution to the fish passage problem at Glenn-
    Colusa Irrigation District's Pump Station is an important element to
    Central Valley fish restoration. The agencies that have worked
    cooperatively to develop the Glenn-Colusa Irrigation District's Fish
    Screen Improvement Project include Glenn-Colusa Irrigation District,
    the United State Bureau of Reclamation, the United States Army Corps of
    Engineers, the Department of Fish and Game, the National Marine
    Fisheries Service, the United States Fish and Wildlife Service, the
    Department of Water Resources and the Reclamation Board.
        The project consists of two important elements, the fish screen
    facility and the gradient facility. Construction began on the
    approximately 600-foot extension to the existing flat-plate fish screen
    in May of 1998.
        The second critical element of the Fish Screen Improvement Project
    is the design and construction of the gradient facility in the mainstem
    of the Sacramento River. It is designed with the characteristics of a
    natural riffle, providing a ``hard point'' in the river that will
    stabilize the Sacramento River in the project reach, and restore the
    minimum water surface elevations at the fish screen to provide adequate
    water speed for efficient screen and fish bypass performance.
    Construction of the gradient facility is expected to begin subsequent
    to the fish screen construction in 2000 and be completed by 2001.
        CWC 333--Kaweah River (Tulare).--Terminus Dam was authorized by the
    1944 Flood Control Act and was constructed by the U. S. Army Corps of
    Engineers in 1962. Since construction of Terminus Dam, damaging floods
    have occurred in many years. Downstream communities and areas adjacent
    to the flood plain are at risk of future flooding.
        Initially, various alternatives were evaluated, including
    alternative storage sites, detention basins, construction alternatives,
    and nonstructural measures. Based on technical, economical, and
    environmental criteria, the only feasible alternative is to raise and
    widen the spillway at Terminus Dam. The Corps' Authorized Plan includes
    raising the elevation of the existing Terminus Dam spillway. Reservoir
    storage capacity would be increased by 42,600 acre-feet (about 30
    percent). This feature will save an estimated seven million dollars of
    the approximate 40 million dollar Project cost.
        The State of California sponsor is The Reclamation Board and the
    local sponsors of the Project are the Kaweah Delta Water Conservation
    District (lead agency), City of Visalia, Tulare Lake Basin Water
    Storage District, Tulare County, and Kings County.
        CWC 381--Los Angeles County Drainage Area Project (LACDA).--The Los
    Angeles County Drainage Area, current population of over 9 million, is
    partially protected by an urban flood control system which includes
    Corps flood control structures consisting of 5 major reservoirs, 22
    debris basins, and 470 miles of channel improvements. The existing
    system, protecting the second largest urban metropolitan area in the
    United States, has prevented over $3.7 billion in damages since
    construction. However, the flood of 1969 in Los Angeles County caused
    widespread damages of over $12 million, $56.5 million at 1996 prices.
        The LACDA Project involves raising of 21 miles of existing levees
    which were originally built 40-50 years ago and modifying 21 bridge
    crossings. The Project was authorized by Congress in 1992. Construction
    began in February 1996. Six construction contracts which included 4.5
    miles of levee raising and modifications to seven bridges have been
    completed.
        The President's Proposed Budget for fiscal year 2000 includes $30
    million for this Project, and if not increased, would delay the
    completion of the project by at least one to two more years. This will
    prolong the risk of flooding and continue to jeopardize the safety of
    those living in the 75-square-mile overflow area. Such a condition is
    unacceptable.
        CWC 382--Santa Ana River Mainstem (Includes San Timoteo).--The
    project is located along a 75-mile reach of the Santa Ana River in
    Orange, Riverside, and San Bernardino counties southeast of and
    adjacent to metropolitan Los Angeles, California. Construction of this
    project will primarily provide protection to lands and improvements
    within Orange County downstream of Prado Reservoir. A severe flood
    threat exists in this area, which could cause damages in excess of $15
    billion and could endanger and disrupt the lives of over three million
    people living or working in the floodplain.
        The $28 million request includes $20 million dollars to continue
    construction on Seven Oaks Dam and the Lower Santa Ana River plus $8
    million to begin construction (a new start appropriation is required)
    at Prado Dam. Commencement of construction on improvements to Prado Dam
    is very important. This feature of the SAR Project is the key link in
    providing the level of flood protection envisioned by Congress when it
    authorized the SAR Project in 1986.
        CWC 387--Norco Bluffs Bank Stabilization-Santa Ana River.--The
    study area is located approximately 40 miles southeast of Los Angeles
    in the City of Norco along the south bank of the Santa Ana River. Flood
    induced migration of the main channel of the Santa Ana River to the
    base of the bluffs has resulted in undercutting and subsequent bank de-
    stabilization which threatens residential development along the edge of
    the bluffs.
        The purpose of this project is to protect a susceptible 65 foot
    high bluff in Norco from further retreat into the residential
    neighborhood. Severe bank sloughing results when flood flows within the
    Santa Ana River attack the toe of the bluffs. Water Resources
    Development Act of 1996, Section 101b(4), provided for the
    authorization of the project based on a Chief's Report dated December
    23, 1996 that recommended the project for construction. Certain
    geotechnical design considerations have resulted in an increased cost
    for the project, and the Commission is therefore seeking supplemental
    funding in the amount of $2,200,000 in fiscal year 2000 for completion
    of construction of the Norco Bluffs Bank Stabilization Project.
        CWC 400--Flood Control Act of 1948, Section 205, Flood Damage
    Prevention.--The California Water Commission heard testimony at its
    March 5, 1999 meeting requesting support on individual projects. Each
    of these projects have merit and are needed to prevent recurring flood
    damages in the local areas. The Commission supports these projects for
    funding from this Continuing Authority for small projects.
        The Commission has witnessed many successful projects in California
    over the years that have been funded from this Authority. However, the
    list of project requests are exceeding the funding level. The
    Commission voted to support a request to Congress to increase the
    nationwide funding level from the present $26,000,000 to $50,000,000.
        CWC 420--Water Resources Development Act, 1996, Section 206,
    Aquatic Ecosystem Restoration.--The California Water Commission heard
    testimony at its March 5, 1999 meeting requesting support on individual
    projects. The Commission supports these projects to improve the quality
    of the environment. Section 206 directs the Secretary of the Army to
    carry out such projects if the Secretary determines that the project
    will improve the quality of the environment and is in the public
    interest; and is cost-effective. The cost-sharing provisions state that
    the nonFederal interests shall provide 35 percent of the cost of the
    construction of any project carried out under this section, including
    provision of all lands, easements, rights-of-way, and necessary
    relocation.
        The Commission voted to support a request to Congress to increase
    the nationwide funding level from the present $4,500,000 to
    $10,000,000.
        CWC 430--Water Resources Development Act, 1996, Section 503,
    Watershed Mgt. Restoration & Development.--The California Water
    Commission heard testimony at its March 5, 1999 meeting requesting
    support on individual projects. The Commission supports fiscal year
    2000 appropriations for the projects. This provision gives the
    Secretary of the Army the authority to have the Corps provide
    technical, planning and design assistance to nonFederal interests for
    carrying out watershed management, restoration and development projects
    at locations listed in Section 503, Water Resources Development Act,
    1996.
        The Commission voted to support a request to Congress to increase
    the nationwide funding level from the present $15,000,000 to
    $30,000,000.
        CWC 440--Water Resources Development Act, 1986, Section 1135,
    Project Modification for Improvement of the Environment Program.--The
    California Water Commission heard testimony at its March 5, 1999
    meeting requesting support on individual projects. The Commission
    supports fiscal year 2000 appropriations for each of these projects.
    Water Resources Development Act of 1986, Section 1135, directs the
    Secretary of the Army to review the operation of water resources
    projects constructed before the date of the Act to determine the need
    for modifications in the structures and operations of such projects for
    the purpose of improving the quality of the environment in the public
    interest. The Commission voted to support a request to Congress to
    increase the nationwide funding level from the present $8,500,000 to
    $20,000,000. Additional funds are needed as this list of important
    projects increase.
                           u.s. bureau of reclamation
        CWC 500--Bay-Delta Ecosystem Restoration.--At the confluence of
    California's two largest rivers, the Sacramento and San Joaquin, the
    San Francisco Bay and adjoining Sacramento-San Joaquin Delta (Bay-
    Delta) together form the largest estuary in the western United States.
    The Bay-Delta is a haven for plants and wildlife, supporting over 750
    plant and animal species. The Bay-Delta supplies drinking water for
    two-thirds of California's citizens and irrigation water for over 7
    million acres of the most highly productive agricultural land in the
    world.
        The CALFED Bay-Delta Program is an open collaborative, state-
    federal-stakeholder effort seeking to develop a comprehensive long-term
    plan to restore ecosystem health and improve water management for
    beneficial uses of the Bay-Delta system. The Program is fundamentally
    different from previous efforts because it seeks to address ecosystem
    restoration, water quality, water supply reliability, and levee and
    channel integrity as co-equal program purposes.
        On December 18, 1998, CALFED released the Revised Phase II Report
    which outlined the draft preferred alternative for solving the problems
    in the Bay-Delta system. The CALFED Program expects to release a
    Revised Draft EIS/EIR in the spring of 1999. This release will be
    followed by a public comment period and further refinement of the
    proposed plan. The goal is to have a final EIS/EIR certified by
    December 1999 with implementation of the plan to begin in the year
    2000.
        CWC--612--Coleman National Fish Hatchery Modification.--The Coleman
    National Fish Hatchery was built by the U.S. Bureau of Reclamation
    (USBR) on Battle Creek in 1942 to mitigate damages to salmon spawning
    areas in the Sacramento River system caused by the construction of
    Shasta and Keswick Dams. Federal custody and operation were transferred
    to the U.S. Fish and Wildlife Service (USFWS) in 1948. Title 34 of
    Public Law 102-575 (Central Valley Project Improvement Act) specifies
    that USBR provide funding for completion of the rehabilitation of the
    Coleman National Fish Hatchery: 50 percent will be reimbursable from
    water and power users and 50 percent non-reimbursable.
        Remaining rehabilitation facilities are additional water treatment
    facilities which include one sand filter, an air compressor, and one
    ozone contact/stripper capable of treating 15,000 gallons per minute
    and installation of various ozone equipment. Also, installation of a
    54-inch pipeline from the ozone treatment plant to the large raceways.
    The replacement of facilities for administration, the fish health
    laboratory and public contact area will be the final items to complete
    the modifications at Coleman NFH.
        CWC 621--Winter-Run Chinook Salmon, Captive Broodstock Program.--
    The captive broodstock program arose from shared concerns for the fate
    of the Sacramento River winter-run chinook salmon. Active participants
    have included representatives of U.S. Fish and Wildlife Service,
    National Marine Fisheries Service, U.S. Bureau of Reclamation, Bodega
    Marine Laboratory of the University of California, Steinhart Aquarium
    of the California Academy of Sciences, California Department of Fish
    and Game, California Department of Water Resources, Pacific Coast
    Federation of Fishermen's Associations, Tyee Club and California Water
    Commission.
        The program has promoted the genetic conservation of winter-run
    chinook salmon. Analyses of the effective size of the winter-run stock
    showed that a properly managed artificial propagation program to which
    the captive broodstock program contributes gametes is not likely to
    have a negative effect and may, instead, be helping to maintain or
    slightly increase the genetic diversity of the stock.
        The captive broodstock program was initiated as a rapid response to
    the endangerment of the Sacramento River winter-run chinook salmon. To
    date, the program has realized many of its objectives. Gametes from
    captively reared broodstock have contributed to artificial propagation
    of the winter-run population. In each year since its inception, the
    program has provided progressively better spawners, gamete quality,
    fertilization and production of juvenile fish. The artificial
    propagation program is actively pursuing improvements to rearing
    facilities and genetics and mating protocols to eliminate concerns
    about hybridizing Spring run. The recently completed Livingston Stone
    NFH below Shasta Dam is expected to successfully imprint the young fry
    on Sacramento River water. Most important, the scientific and technical
    advances by the program will provide an important legacy to salmon
    biology.
        CWC 622--Hamilton City Pumping Plant Fish Facility.--Finding a
    solution to the fish passage problem at Glenn-Colusa Irrigation
    District's Pump Station is an important element to Central Valley fish
    restoration. The agencies that have worked cooperatively to develop the
    Glenn-Colusa Irrigation District's Fish Screen Improvement Project
    include Glenn-Colusa Irrigation District, the United State Bureau of
    Reclamation, the United States Army Corps of Engineers, the Department
    of Fish and Game, the National Marine Fisheries Service, the United
    States Fish and Wildlife Service, the Department of Water Resources and
    the Reclamation Board.
        The project consists of two important elements, the fish screen
    facility and the gradient facility. Construction began on the
    approximately 600-foot extension to the existing flat-plate fish screen
    in May of 1998. Included in the screen structure are three internal
    bypasses that will allow for reduced fish exposure to the screen. The
    bypasses will exit the fish into the lower oxbow channel. Significant
    improvements are being made to the lower oxbow channel and training
    wall to meet hydraulic criteria past the facility. In addition, a water
    control structure (weir) with a removable bridge to allow access to
    Montgomery Island for routine dredging operations has been designed by
    Glenn-Colusa Irrigation District and constructed under Reclamation's
    contract.
        Adequate funding for completion of construction is essential to
    meeting the important goals of a long-term fish passage solution at
    Glenn-Colusa Irrigation District's main pump station and to assist with
    Central Valley fish restoration.
        CWC 663--Arroyo Pasajero Studies--Cantua Creek Strm Group-EIS.--The
    Cantua Creek Stream Group consists of seven western San Joaquin Valley
    ephemeral streams, as well as several smaller unnamed drainages located
    west of the San Luis Canal segment of the California Aqueduct extending
    between 20 and 50 miles north of the Arroyo Pasajero.
        Flood water overtopped the western embankment of the Canal in 1969
    and 1995, causing extensive damage to the concrete lining. Since the
    1960s, over 40,000 acre-feet of Cantua Creek Stream Group flood water
    and an estimated 2.5 million cubic yards of sediment have entered the
    Canal from overtopping or through the drain inlets. These streams have
    also deposited as much as 2.9 million cubic yards of sediment upslope
    of the Canal, eliminating 1,600 acre-feet (about 50 percent) of the
    original impounding capacity. The Cantua Creek Stream Group poses a
    flood risk with a potential to breach the Canal and disrupt water
    service to millions of people in southern California and the southern
    San Joaquin Valley. In addition, the cost associated with the
    degradation to water quality from uncontrolled flood inflow is a
    substantial expense to both the Canal operators and water customers.
    The situation is continually worsening as additional sediment is
    deposited along the west side of the Aqueduct.
        The Department of Water Resources, with cost sharing by USBR, is
    completing a reconnaissance study of these drainage and sedimentation
    problems and will be performing feasibility level investigations during
    fiscal year 2000 to seek solutions. In addition, interim improvements
    to restore diminished impounding capacity and improve sediment
    decanting capabilities for smaller flood flows will extend into fiscal
    year 2000. Under the San Luis Unit Joint-Use Facilities Agreement, USBR
    is responsible for 45 percent of the cost of this work.
        CWC 701--Central Valley Project.--The Nation's public works
    infrastructure is aging. We must ensure that adequate levels of funding
    are provided to protect the public's investment in facilities which we
    rely upon daily to provide water supply, flood protection, public
    safety, and other benefits. California's population of 32 million
    people depends upon a network of local, state, and federal
    infrastructure developed over the past decades. Today, governments at
    all levels are finding it increasingly difficult to find funds to
    properly maintain existing facilities. The competition for funding
    raises important public policy questions about the relationship of
    funding for new projects and programs as opposed to funding to maintain
    and rehabilitate existing infrastructure.
        Too often, the temporary solution used by all levels of government
    to meet budgetary constraints is to defer maintenance funding. However,
    deferred maintenance does not come without a price.
        Given the increasing competition for federal dollars, we must be
    prepared to make the difficult choice of deferring studies and new
    projects until we are assured that existing federal facilities are
    receiving appropriate levels of safety review and maintenance.
        CWC 900--Public Law 102-575, Title XVI and Amended by Public Law
    104-266 (Mid-Pacific Region); CWC 1000--Public Law 102-575, Title XVI
    and Amended by Public Law 104-266 (Lower Colorado Region).--The
    California Water Commission has long recognized water recycling as an
    important element in the management of California's water resources,
    both for cleanup of municipal, industrial and agricultural discharges
    and to improve the quantity and quality of water supplies. The
    Department of Water Resources' Bulletin 160-98, California Water Plan
    Update, January 1998, identifies up to 800,000 acre-feet of total
    potential additional water recycling in California by the year 2020.
        It is the Commission's view that both water recycling programs and
    the other ongoing USBR programs are highly important and that they
    should be supported in concert, within the limitations of available
    federal funds, giving due consideration to other potential sources of
    funds that could be available to effect their implementation. The
    Commission agreed to work with USBR on language which will give the
    local sponsor greater assurance of future year support. This will also
    encourage sponsors to go ahead with expanded facilities with greater
    expectation of out-year funding.
        CWC 1108--Salton Sea Research Project.--Over the last several
    decades there has been concern over the increasing salinity of the
    Salton Sea and the impacts it has had on the Sea's ecology. Increasing
    salinity and other water quality issues are threatening biological
    values and recreational uses of the Sea. An additional concern is the
    rising water surface elevation. The raising water surface has flooded
    much of the developed area and the shoreline wildlife habitat used by a
    number of different bird species. The rising sea also has inundated
    much of the Salton Sea National Wildlife Refuge at the south end of the
    sea. The full impacts of increasing salinity, the decline in other
    water quality attributes, and water surface elevation on endangered
    species that inhabit the sea are unknown, but studies are presently
    ongoing. In order to identify and evaluate possibilities for improving
    the condition of the sea, a program of additional planning, research,
    and environmental impact analysis are needed.
        The objectives of this program are to identify and evaluate
    alternatives to: improve water quality conditions; maintain quality
    habitat for migratory birds and endangered species; enhance the
    fishery; and protect human recreation values in and around the Salton
    Sea. Environmental scoping and scientific research of remediation
    alternatives currently is underway.
        CWC 1300--Colorado River Salinity Control Program; CWC 1302--Title
    I Division (Lower Colorado).--The California Water Commission heard
    testimony at its March 5, 1999 meeting requesting support for federal
    funding levels that are required to meet the numeric criteria and
    standards that have been established for salinity on the Colorado
    River.
        The Commission supports fiscal year 2000 appropriations of
    $13,092,000 for Title I of the Colorado River Basin Salinity Control
    Act, which covers delivery of water to Mexico, pursuant to the 1944
    Mexican Water Treaty and Minute 242 of the International Boundary and
    Water Commission.
        CWC 1304--Basin-wide Program.--The California Water Commission
    heard testimony at its March 5, 1999 meeting requesting support for
    federal funding levels for water quality programs under Title II of the
    Colorado River Basin Salinity Control Act. The Commission voted to
    support a request to Congress to increase the Basin-wide funding level
    from the present $12,300,000 to $17,500,000. The Commission believes
    that this increase is necessary to meet the established numeric
    criteria and standards for salinity in the Colorado River.
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                                     ______

     Prepared Statement of Barbara LeVake, President, and Peter D. Rabbon,
    General Manager, the Resources Agency and the Reclamation Board, State
                                 of California

      THE RECLAMATION BOARD FINAL RECOMMENDATIONS FOR FEDERAL FLOOD CONTROL
                       PROJECTS--FISCAL YEAR 2000 SUMMARY
                             [Dollars in thousands]
    ------------------------------------------------------------------------
                                                President's        Board
      Corps of Engineers' projects     Page       budget        recommends
    ------------------------------------------------------------------------
    I. GENERAL INVESTIGATIONS--
     SURVEYS
        Sacramento and San Joaquin         1          $2,000          $3,000
         River Basins Comprehensive
         Study.....................
        Northern California Streams
        --Middle Creek.............        1             150             300
        San Joaquin River Basin....
        --Stockton Metropolitan            1             200             380
         Area (Section 211)........
        --West Stanislaus County...        2             250             400
        Sutter Basin (Sutter)......        1              60             100
    PRECONSTRUCTION ENGINEERING AND
     DESIGN
        American River Watershed...        4           5,000           5,000
        Yuba River.................        4             150             700
        South Sacramento County            4             500           4,000
         Streams...................
        San Joaquin River Basin....
        --Tule River...............        4             150             800
        Arroyo Pasajero............        4             150           2,685
        Kaweah River (Tulare)......        4             582             582
    III. CONSTRUCTION--GENERAL
        Sacramento River Bank              5           7,000           7,000
         Protection................
        Mid-Valley Area Levee              5           4,000           4,000
         Reconstruction............
        Marysville/Yuba City Levee         5             300             300
         Reconstruction............
        West Sacramento Project....        5           7,700           7,700
        American River Watershed           5          17,000          17,000
         (Common Elements).........
        Kaweah River (Tulare)......        5  ..............           2,500
        Lower Sacramento Area Levee        5           2,317           2,317
         Reconstruction............
        Upper Sacramento Area Levee        5           3,055           3,055
         Reconstruction............
        American River Watershed           5           4,000           7,900
         (Natomas).................
        Merced County Streams......        5             500             500
    ------------------------------------------------------------------------

                    the reclamation board's recommendations
        The Reclamation Board, as the State agency which furnishes required
    local assurances for a majority of the federal flood control projects
    in California's Central Valley, respectfully submits this statement of
    support for U.S Army Corps of Engineers flood control projects.
        The Board in general supports the President's budget for federal
    flood control projects in the California Central Valley. The projects
    described below are of particular importance to the health, safety, and
    well-being of Central Valley residents and are especially important to
    The Reclamation Board that they are started and/or kept on schedule.
                        general investigations--surveys
    Sacramento and San Joaquin River Basins Comprehensive Study
        The study area includes the entire Sacramento River Basin and San
    Joaquin River Basin in Northern and Central California, respectively.
    Local, State and federal water resources agencies support a coordinated
    multiobjective investigation to balance flood damage reduction,
    environmental restoration, and other water resources proposed along the
    Rivers. The Feasibility Cost-Sharing Agreement was executed in February
    1998. An interim status report will be released in April 1999. The
    Board recommends funding to continue this study.
    Northern California Streams
        This survey, authorized in 1962, is a study of the Sacramento River
    and its tributaries in regard to flood control measures. The following
    is an interim study proposal.
        Middle Creek.-- A reconnaissance study which evaluated several
    alternatives near Middle Creek's confluence with Clear Lake in Lake
    County was completed in 1997. Existing levees which do not provide
    adequate flood protection need to be repaired and upgraded. The Board
    supports funding to continue the feasibility study.
    San Joaquin River Basin
        This survey, authorized in 1964, is a study of the San Joaquin
    River and its tributaries in regard to flood control measures. The
    following are interimstudy proposals.
        Stockton Metropolitan Area (Section 211).--Construction to protect
    the urban areas of Stockton has been completed. This feasibility study
    will evaluate alternatives for protecting the rural areas. The Board
    recommends funding to complete this study.
        West Stanislaus County.--A feasibility study is ongoing to evaluate
    flood control alternatives for the westside communities in Stanislaus
    County. The Board recommends funding to complete the feasibility study.
    Sutter Basin (Sutter)
        A reconnaissance study is being conducted to evaluate increased
    flood protection for Sutter County which has repeatedly sustained flood
    damage. The Board recommends funding to initiate the feasibility study.
                     preconstruction engineering and design
    American River Watershed
        The Sacramento urban area has only a 77-year level of protection
    from flooding by the American River. Although incremental actions have
    occurred, a long-term plan for high levels of protection must be
    developed and implemented. The Board recommends funding to continue
    long-term planning and preconstruction engineering and design.
    Yuba River
        The Marysville and Yuba City areas have experienced seven major
    floods. A feasibility study was completed in April 1998. The Board
    recommends funding to continue preconstruction engineering and design.
    South Sacramento County Streams
        The completed feasibility report recommends levee and channel
    improvements to protect the urbanized area of south Sacramento. The
    Board recommends funding for continued PED.
    San Joaquin River Basin
        Tule River.--The proposed enlargement of Success Dam on the Tule
    River will improve flood protection for the City of Porterville and
    surrounding community. The Board recommends funding to continue PED.
    Arroyo Pasajero
        Flood protection is inadequate for the California Aqueduct (a major
    water transfer facility) and two communities located 50 miles southwest
    of the City of Fresno. The Board recommends funding to continue PED.
    Kaweah River (Tulare)
        This project would provide flood protection to the communities of
    Visalia, Farmersville, Tulare, Ivanhoe, and Goshen. The project was
    authorized in the Water Resources Development Act of 1996. The Board
    recommends funding to continue PED.
                             construction--general
    Sacramento River Bank Protection
        The project, authorized in 1960, is a long-range federal/State
    effort to preserve the existing project levee system along 192 miles of
    the Sacramento River. The Sacramento River Bank Protection Project work
    consists of providing some form of bank stabilization at those points
    which are identified each year as the most critical. The Board
    recommends funding to continue construction.
    Mid-Valley Area Levee Reconstruction
        An evaluation of about 240 miles of the Sacramento River Flood
    Control Project levees in the Sacramento Mid-Valley area identified
    about 20 miles of levees that are structurally deficient and require
    reconstruction. The Board recommends funding to continue construction.
    Marysville/Yuba City Levee Reconstruction
        This program will reconstruct 44 miles of the 134 miles of
    federally authorized levees which protect the Marysville/Yuba City
    area. The first of three construction contracts was awarded in July
    1995. Flooding in 1997 demonstrated the need to extend the work sites,
    modify the design, and investigate new sites in the project area. The
    Board recommends funding to continue construction.
    West Sacramento Project
        The Board is the nonfederal sponsor for the West Sacramento Flood
    Control Project which was authorized for construction by WRDA 1992. The
    Board supports funding to continue construction.
    American River Watershed (Common Elements)
        The Common Elements Project was authorized in WRDA 1996. This
    Project consists of features that would be common to any long-term
    project selected for the American River. The Board recommends funding
    to continue construction.
    Kaweah River--discussed in PED
        The Board recommends funding to initiate construction.
    Lower Sacramento Area Levee Reconstruction
        An evaluation of about 295 miles of the Sacramento River Flood
    Control Project levees in the lower Sacramento Valley area identified
    about 47 miles of levees that are structurally deficient. The project
    includes reconstructing about 2 miles of these levees. The Board
    recommends funding for construction.
    Upper Sacramento Area Levee Reconstruction
        Federally authorized flood control levees in the upper Sacramento
    Area were evaluated and 12 miles were determined to be deficient and
    requiring reconstruction. The Board recommends funding for
    construction.
    American River Watershed (Natomas)
        The project was authorized but not funded in 1992. The local flood
    control agency proceeded with the work. The Board recommends funding to
    reimburse the federal cost-sharing portion to the nonfederal sponsor.
    Merced County Streams
        This project provides increased levels of flood protection to the
    Cities of Merced and Atwater and associated urban areas. First phase of
    construction has been completed. The Board recommends funding to
    continue construction.
                                     ______

       Prepared Statement of Gaye Lopez, Manager, Colusa Basin Drainage
                                    District
    USBR Fiscal Year 2000 Request: $1,000,000
        The Colusa Basin Drainage District requests the Committee's support
    for $1,000,000 for fiscal year 2000. This amount will allow the
    District to begin the final design and preparation of plans and
    specifications for Phase I reservoir projects, the acquisition of
    rights of way, the installation of a water stage and quality monitoring
    system, the clearing of the Colusa Basin Drain, studies of feasibility
    of catchment basins and other innovative facilities and the planning/
    implementation of nonstructural flood control and water quality/
    environmental measures.
        The Colusa Basin Drainage District appreciates your past support
    for our Integrated Resources Management Plan for water management that
    addresses flooding and that provides opportunities for future
    conjunctive use of water resources to meet the diverse needs of
    agricultural, urban and wildlife interests in the Colusa Basin.
        Each of the three phases of the District's Plan consists of three
    components: structural facilities, improved O&M of existing facilities,
    and new nonstructural and environmental enhancements. Phase I of the
    Program includes 3,000 acres of wetland and streambank restoration.
    Background
        The 650,000 acre Colusa Basin Drainage District, located on the
    west side of the Sacramento River, serves a large watershed exceeding
    one million acres. It covers all or part of Glenn, Colusa and northern
    Yolo Counties. It not only is a rich agricultural area, but a rich
    wildlife area as well, including three national wildlife refuges.
        Over the decades, devastating floods have repeatedly struck the
    Colusa Basin resulting in costly damages to public and private property
    and loss of life. In 1995, these three counties suffered an estimated
    $100,000,000 in damages and 1 death due to flooding; in 1998, these
    three counties suffered an estimated $40,000,000 in damages due to
    flooding. In November 1995, a majority of landowners voted to implement
    the District's Integrated Resources Management Plan to address flood
    damage while obtaining the other benefits of increasing groundwater
    supplies, surface water storage, and improved environmental and
    wildlife uses in the watershed.
        Through a stakeholder/local, state and federal agency collaborative
    process, four projects have been initially selected to be developed to
    serve as a demonstration of the integrated resources management
    approach to resolving the Basin's flooding problems. Hydraulic studies
    on proposed facilities were completed in 1998. The preparation of
    Basin-wide programmatic environmental documentation commenced during
    1998 and is scheduled for completion in fiscal year 1999. Project
    specific environmental documentation will begin later this year.
        This request is for an appropriation of $1,000,000 in fiscal year
    2000; however, the District has the capability and need for $2,000,000
    to put this project more on the schedule earlier submitted to your
    Committee. The $2,000,000 would not be used for construction, but we
    believe would be sufficient to complete all necessary pre-construction
    tasks for one or more reservoir projects.
        We believe our Integrated Resource Management approach to solving a
    number of problems across a large area with the same dollar is a wise
    expenditure of public funds.
        Thank you for your continued support.
    US Army Corps of Engineers Fiscal Year 2000 Request: $500,000
        The Colusa Basin Drainage District is requesting $500,000 in
    funding for fiscal year 2000 for use by the U.S. Army Corps of
    Engineers to begin the design, planning, and environmental review
    associated with a 3,000 acre wetlands project. The project will be
    located in the southern portion of the Sacramento Valley, California.
        The District--in conjunction with the U.S. Bureau of Reclamation,
    the U.S. Fish and Wildlife Service, the Corps of Engineers and a number
    of state and local agencies--is using the technique of integrated
    resource management in order to provide flood protection and
    environmental restoration to the Colusa Basin, which is located on the
    west side of the Sacramento Valley. The Colusa Basin Watershed Program
    includes structural flood protection measures (small off stream
    detention basins on ephemeral streams that lack anadromous fisheries),
    improved operation and maintenance of existing flood control
    facilities, and nonstructural flood protection measures (creation of
    wetlands, riparian and upland habitats and the introduction of best
    management practices to control erosion and sedimentation). One of the
    goals of the Program is to create 10,000 acres of habitat in the Colusa
    Basin over the next 20 to 30 years. The Program is fully compatible
    with the ecosystem restoration projects being proposed and implemented
    by the CALFED Bay-Delta Program.
        The site of the proposed wetlands will be northern Yolo County and
    southern Colusa County, in the midst of the Pacific Flyway. These lands
    are located adjacent to the Colusa Basin Drain and have regularly been
    flooded in past years. The project would involve constructing one or
    more detention basin(s) that would store floodwaters and so create
    seasonal wetlands. The proposed site of the project also contains
    groundwater wells, which may permit the creation of permanent wetlands
    or other habitat. In order to reduce the costs of operation and
    maintenance, agricultural activities that are consistent with the use
    of the property as habitat may be permitted during the summer months on
    portions of the property.
                                     ______

         Prepared Statement of Joseph L. Campbell, President, Board of
                     Directors, Contra Costa Water District
    Subject: Contra Costa Canal Fish Screen fiscal year 2000 Appropriation
        The Contra Costa Canal (Rock Slough) intake of the Central Valley
    Project (CVP) is the largest urban water intake in California's
    Sacramento-San Joaquin Delta. The intake is the primary source of water
    for 400,000 people in Central and Eastern Contra Costa County.
        Because this 60-year-old intake is not screened, its impact on the
    aquatic life of the Delta has been a subject of concern for many years
    as local, state and federal interests work together to restore the
    health of Bay-Delta estuary. Under provisions of the Central Valley
    Project Improvement Act [PL 102-575, Sec. 3406 (b) (5)], the Secretary
    of Interior is required to screen the Contra Costa Canal intake, which
    is owned by the US Bureau of Reclamation (USBR).
        Over the past five years, the relevant federal, state and local
    agencies have worked together to develop a plan to screen the intake,
    have completed the permitting, and have completed the design for the
    fish screen that will protect threatened and endangered species in the
    vicinity of the Contra Costa Canal intake. The project went to bid in
    February.
        Appropriations have been requested for the fish screen in each of
    the past four years. In response, the Congress has appropriated
    $4,330,000 to the Department of Interior for the fish screen. A final
    appropriation of $5,000,000 is critical, because construction is
    scheduled to begin this summer. If additional funds are provided by the
    State of California, the level of Congressional appropriation could be
    reduced.
        Completion on the current schedule is critical to the Contra Costa
    Water District's continued ability to draw water for its 400,000
    customers. The US Fish and Wildlife Service (USFWS), requires that the
    Rock Slough screen be completed and provided authority for USFWS to
    shut down all pumping if the screen is not completed in a timely
    manner. Thus, it is essential that the remaining construction funds be
    provided in the fiscal year 2000 appropriation.
        The fish screen is one element of a larger program to mitigate
    fishery impacts in the Delta. The progress to date on the Contra Costa
    Canal Fish Screen is a success story both for this facility and in the
    broader context of the multi-party effort to restore the deteriorated
    Bay-Delta estuary, the largest estuary on the West Coast.
        Your active support for this essential appropriation is
    appreciated. It will complete a congressionally mandated facility,
    protect Delta fisheries, and insure that water supplies for 400,000
    people served by the Contra Costa Water District are not jeopardized.
                                     ______

    Prepared Statement of Carl W. Mosher, Director, Environmental Services
                    Department, City of San Jose, California
        My name is Carl W. Mosher, and I am Director of Environmental
    Services for the City of San Jose, California. I am testifying on
    behalf of the San Jose Water Reclamation and Reuse Program, now known
    as South Bay Water Recycling. San Jose is the lead agency of a joint
    powers authority which owns and operates the San Jose/Santa Clara Water
    Pollution Control Plant, a regional wastewater treatment facility
    serving more than 1,200,000 residents, businesses and industries in
    Silicon Valley. South Bay Water Recycling, which recycles effluent from
    the treatment plant, is the largest urban water recycling project in
    northern California.
        We are requesting your assistance in increasing the Bureau of
    Reclamation (BOR) funding for South Bay Water Recycling from the
    $3,000,000 in the President's budget to $10,000,000. The first phase of
    the program, completed in 1998, will deliver up to 15,000,000 gallons
    of water per day. It was financed by the cities of San Jose, Santa
    Clara and Milpitas and five other agencies, in cooperation with the
    Santa Clara Valley Water District. The City is now planning a second
    phase to double recycled water use at a cost of an additional
    $100,000,000.
        As you know, Title XVI of the CVPIA (Public Law 92-575) authorizes
    the Bureau of Reclamation to contribute up to 25 percent of eligible
    project costs. However, due to competing demands, BOR's Mid-Pacific
    Region has budgeted less than half of the $35,000,000 authorized by
    Congress. The Bureau has indicated that they will be unable to
    participate in future planning or construction until Congress
    appropriates sufficient funds to meet their existing obligations. The
    President's fiscal year 1999/00 Budget includes a request for SBWR for
    $3,000,000. At the current rate of funding, that will not occur until
    2007.
        Through the efforts of San Jose, the Santa Clara Valley Water
    District and other Silicon Valley cities and agencies, our region is
    becoming a leader in sustainable water use, integrating water supply
    and wastewater discharge through innovations in water recycling and
    conservation. Long-term local plans anticipate up to 100,000,000
    gallons of reuse per day by 2020, through projects coordinated with our
    regional effort, the Bay Area Regional Water Recycling Program.
        If sufficient federal funds are not available to leverage local
    funding, Silicon Valley and other California communities will not soon
    achieve sustainable water use. Given the need for water in the
    environment, competing demands of agriculture and cities, and the
    constant threat of drought, water recycling just makes sense. The
    California Department of Water Resources projects a deficit of six
    million acre-feet of water during a critical dry year. During the
    1970's and early 80's, the federal government spent tens of billions of
    dollars to fund facilities so we could stop treating our rivers and
    lakes as sewers and cesspools. Certainly this smaller investment is
    justified to use water more wisely and more often, and restore our
    environment.
        In order to obtain funding authorized by Congress and allow Bureau
    participation in future phases, the City is seeking a write-in
    appropriation for SBWR for $10,000,000 next fiscal year. We appreciate
    your support for this level of funding during upcoming committee
    hearings.
                                     ______

        Prepared Statement of Donald Bransford, President, Glenn-Colusa
                              Irrigation District
        Mr. Chairman, Members of the Subcommittee, my name is Don
    Bransford. I am a rice farmer from Colusa County, California, and I am
    President of the Board of Directors of the GlennColusa Irrigation
    District (GCID or District).
        I appreciate the opportunity to provide you this statement
    regarding the federal funding priorities for GCID. I also appreciate
    the Subcommittee's past efforts to address our concerns.
        GCID is the largest and one of the oldest diverters of water from
    the Sacramento River. The District delivers water to approximately
    1,200 families who have about 141,000 acres of land in cultivation in
    Glenn and Colusa Counties. More than $270,000,000 in agricultural
    products are produced annually on GCID farms, helping to sustain an
    estimated 12,000 jobs in the region.
        The District is also the sole source of surface water for three
    wildlife refuges--the Sacramento, Delevan and Colusa National Wildlife
    Refuges--that cover some 20,000 acres in the heart of the Sacramento
    Valley. The District and the United States Bureau of Reclamation have
    negotiated an agreement that provides for long-term conveyance of water
    to these refuges as well as cost sharing. Winter water supplied by GCID
    to thousands of acres of rice land also provides a rich oasis for
    migrating waterfowl.
        The District is firmly committed to obtaining lasting protection of
    the winterrun salmon and other fishery resources at the Hamilton City
    Pump Station. Over the last several years, the District has invested
    over $3,000,000 in the construction of an interim flatplate fish screen
    and other improvements to provide immediate protection to the
    endangered winterrun chinook salmon and other fish species, and on
    biological monitoring. In addition, GCID has deposited $5,500,000 into
    an account to be used solely for the purpose of design and construction
    of the new fish screen extension and gradient facility, known as the
    ``long term solution'' for the fish passage problems at the Hamilton
    City Pump Station. Finally, GCID has spent an additional $5,500,000 on
    environmental review, land acquisition, environmental mitigation and
    downstream channel improvements, design and construction of the long
    term fish passage solution.
        While the interim flatplate screen, installed in late 1993, has
    been very effective, it is only an interim solution. In order to
    provide this permanent protection of the fisheries resources, the
    permanent fish screen has been under construction since the spring of
    1998, and completion is anticipated in late 1999. Construction of the
    gradient facility portion of the project is scheduled to begin in 2000
    and be completed in 2001. Until completion of the fish screen
    extension, the gradient facility, and testing of the performance of the
    structures, the District will continue to face restrictions which
    result in pumping only 75 percent of the District's full water
    entitlement.
        Unlike some other projects, the availability of nonfederal
    costsharing is not in doubt at GCID. The District has, in addition to
    the funds already invested in the fish screen project, set aside
    $5,500,000 to date to help pay for the nonfederal, 25 percent costshare
    of a new permanent fish screen. California voters have approved almost
    a billion dollars for projects like the GCID fish screen to help
    restore fisheries throughout the Central Valley. We are ready and able
    to costshare any federal funds provided by this Committee.
        On behalf of GCID, the fishery and all of those whose economic fate
    is tied to the recovery of the winterrun salmon, I respectfully request
    that you provide $3,750,000 for the Bureau of Reclamation in fiscal
    year 2000 to continue work on a permanent new fish screen at the
    Hamilton City Pump Station. The President's Budget includes $2,252,000
    for the fish screen extension portion of the project. GCID urges an
    increase because construction of the fish screen extension is
    approximately one year ahead of schedule, resulting in an accelerated
    schedule of biological and hydrological testing that must occur after
    completion of construction to verify that the structure meets the
    resource agencies' fish screening criteria. Specifically, an allocation
    of $3,750,000 is needed to allow completion of construction and
    initiation of testing of the facility in 2000.
        Without such a commitment of funds, construction may be delayed,
    and testing of the facility will be delayed. That will mean less water
    for the farmers and a less speedy recovery of the fishery. Failure to
    provide the funds necessary to complete the project represents a lose-
    lose proposition. It is bad for the farmers and it is bad for the
    fishery resource. Again, I urge you to provide an allocation of
    $3,750,000 to keep the project moving forward on an optimum schedule.
        For the U.S. Army Corps of Engineers, GCID requests the Committee's
    support of an appropriation of $6,000,000 to the Corps of Engineers to
    continue work on the Sacramento River gradient or riffle restoration
    project. Construction of the gradient restoration project will
    stabilize the river elevation and improve the effectiveness of the new
    fish screen built at the District's pumping plant. In addition, the
    gradient facility is critical to ensuring the long-term viability of
    the new fish screen structure under changing river conditions. The
    President's Budget includes $3,000,000 for the gradient facility. GCID
    urges the increase to $6,000,000 because preliminary estimates from the
    Corps indicate that $3,000,000 is far short of what is needed. The
    Corps currently anticipates that the construction of this element of
    the project could begin in 2000 and be completed in 2001. Thus, GCID is
    concerned that the amount presently in the President's Budget will not
    be adequate to allow the Corps to award a construction contract for the
    gradient facility in the fall of 1999, as this low level of funding
    will not allow for completion of the construction in the one year time-
    frame.
        In addition to the budget impacts of the short construction
    schedule, GCID is currently requesting that Congress increase the cost
    ceiling for the gradient facility from $20,700,000 to $26,000,000. The
    original cost estimates were based upon a 30 percent basis of design.
    Further design work and other factors indicate that the total cost of
    the gradient facility will exceed the $20,700,000 ceiling. GCID is also
    seeking a post-authorization change to the gradient facility to expand
    the scope of work to include bank stabilization work at approximately
    River Mile 208, north of the fish screen project. Geomorphological
    studies indicate that flood damage at River Mile 208 potentially puts
    the entire project at risk. These post-authorization changes also
    indicate an increase of the fiscal year 2000 budget for this element of
    the project.
        Finally, Mr. Chairman, GCID requests that the Subcommittee earmark,
    from within the funds made available for refuge water supply,
    $2,400,000 for fiscal year 2000 to continue work on the upgrade of GCID
    canal facilities necessary to make refuge deliveries. The President's
    Budget request includes $4,500,000 for all central valley refuge
    conveyance projects, and GCID requests that $2,400,000 be earmarked for
    the District's project designed to expand water service to the
    Sacramento Refuge complex. In addition, GCID requests that the budget
    for all Central Valley refuge supply projects be increased to
    $6,900,000 to assure that the necessary funds will be available for
    completion of the GCID Refuge Conveyance Project. Preliminary estimates
    by Reclamation indicate that the proposed budget of $4,500,000 for
    refuge supply projects is far short of the total amount actually needed
    for completion of the GCID Refuge Conveyance Project and the initiation
    of work on the other supply projects in the Central Valley. A shortfall
    in the refuge supply budget could adversely impact the GCID Refuge
    Conveyance Project by interfering with the completion of construction
    in progress. Thus, GCID urges an increase in the overall budget for
    refuge supply projects, which would assure that the funds earmarked for
    the GCID Refuge Conveyance Project will be available, and may alleviate
    funding problems associated with other Central Valley refuge supply
    projects which are also essential.
        GCID's Refuge Conveyance Project will enable the District to make
    year-around water deliveries to the three National Wildlife Refuges in
    the GCID service territory (the Sacramento, Delevan and Colusa National
    Wildlife Refuges) as well as make Stony Creek available for possible
    fish restoration activities. It will also allow water deliveries during
    the winter for crop diversification and to expand the acreage flooded
    for rice straw decomposition and wildlife habitat. This project is the
    most efficient and least costly way to provide expanded water service
    to the Sacramento Refuge complex, as required by the Central Valley
    Project Improvement Act.
        Mr. Chairman, Members of the Subcommittee, on behalf of GCID, I
    would like to express my appreciation for your past support of our
    efforts to address the fish bypass problem at the Hamilton City Pump
    Station and our refuge water supply project, and I respectfully request
    your support once again in the fiscal year 2000 Energy and Water
    Development Appropriations Act.
        Thank you for your consideration.
                                     ______

           Prepared Statement of the Coachella Valley Water District
                             whitewater river basin
        The U.S. Army Corps of Engineers, with the Coachella Valley Water
    District as local sponsor, is nearing completion of the feasibility
    study for the Whitewater River Basin flood control project. This
    statement provides a brief status report on this important project.
        The Whitewater River Basin feasibility study is defining a flood
    control project in the northern portion of the Coachella Valley in the
    low desert area of Southern California. This area is subject to
    alluvial fan type flooding originating from sources as far north as
    Joshua Tree National Park. This area has existing businesses and
    residences and is forecast to be a potential growth area.
        The feasibility study is formulating a plan which will have a
    favorable benefit cost ratio for the flood control project. The
    feasibility study is also identifying a major environmental restoration
    component. The study will identify nonstructural flood control
    components which will enhance the Coachella Valley Fringe-Toed Lizard
    Preserve, protecting the endangered Coachella Valley fringe-toed lizard
    as well as providing a multispecies habitat area protected from
    development. Without this flood control project, protecting the sand
    source for the dune environment of the preserve could be very difficult
    to achieve.
        The local community supports the flood protection goals of this
    project and the local environmental community supports the project as
    well.
        Thank you for the continued funding of the feasibility study. The
    project proposed in the feasibility study will be put forward for your
    consideration for the Water Resources Development Act of 2000, if
    possible. Your careful consideration of this important flood control/
    environmental enhancement project will be appreciated.
                                     ______

     Prepared Statement of Ross Rogers, General Manager, Merced Irrigation
                                    District
        Mr. Chairman and Members of the Committee: My name is Ross Rogers,
    General Manager of the Merced Irrigation District. I am respectfully
    submitting this statement on behalf of the County of Merced, the City
    of Merced, and the Merced Irrigation District, which jointly form an
    informal coalition commonly known as the Merced County Streams Group
    for the purpose of performing maintenance functions along portions of
    the Merced County Streams Project. The County of Merced, together with
    the State of California, is the sponsor of the Merced County Streams
    Project. The El Nido Irrigation District and the Le Grand Athlone Water
    District are also concerned in this matter.
        Federal authorization for the project construction was granted as
    part of the Supplemental Appropriations Act of 1985. Authorized
    facilities include constructing dry dams on Canal (Castle Dam) and
    Black Rascal Creeks (Haystack Mountain Dam), enlargement of the
    existing Bear Creek Dam, and modifications of levees and channels along
    more than 25 miles of Fahrens, Black Rascal, Cottonwood, and Bear
    Creeks. The completed project will provide flood protection worth more
    than $10,000,000 per year to 263,000 acres of urban and agricultural
    lands. Total project cost is currently estimated to be $133,000,000 of
    which $40,000,000 or roughly 31 percent will be paid during
    construction by the local beneficiaries.
        When completed, more than 240,000 residents occupying 55,000
    housing units within the greater metropolitan Merced area will live
    with assurance of 125-year flood protection, while the lower rural area
    will receive 25-year protection.
        The first component of the project, Castle Dam, was completed in
    1992. This component was constructed under budget, ahead of schedule,
    and without a lost-time accident. Without Castle Dam during the intense
    storms of January, February, March 1995, January 1997 and January,
    February, March, 1998, the city of Merced would have been partially
    inundated.
        As a result of a request by the County of Merced, the Corps of
    Engineers has reevaluated project components and will extend the
    boundaries of the levee and channel portion of the project to better
    match growth that has taken place in the city of Merced. This
    willingness to remain flexible throughout the lengthy planning and
    design process is also a credit to the Corps and its staff.
        The Merced County Streams Project is a modification and expansion
    of an earlier flood project constructed between 1948 and 1957. It has
    undergone considerable review and modification since first authorized
    as part of the Flood Control Act of 1970. Approximately $18,000,000 has
    been spent to date on the Merced County Streams Project. This has been
    matched with local contributions of approximately $3,000,000. As
    partners in the construction of this project, the local agency sponsors
    have worked closely with the Corps to establish an economic balance
    between costs and benefits. As a result of this combined effort,
    nonessential project components were first scaled back and eventually
    eliminated. This scaling to fit the economic reality resulted in
    substantial federal and local savings.
        On January 15, February 3 and March 25, 1998, due to El Nino-driven
    storms, Bear Creek overtopped its banks in several locations within and
    downstream of the city of Merced, flooding 33 homes, county, city and
    Merced Irrigation District infrastructure, and thousands of acres of
    prime agricultural land, with total damages in the millions of dollars.
    The U. S. Army Corps of Engineers, with input from the National Weather
    Service, estimates that the January 15th and March 25th events were
    both one-in-100 year events, unprecedented for the area. The greatest
    storm intensity in both storms centered in northeastern Merced County
    in and around the watershed of Black Rascal Creek, tributary to Bear
    Creek, upstream of the Merced County Streams Project's proposed
    Haystack Mountain Dam site. According to Corps of Engineer's rating
    tables for the Black Rascal Creek Bypass gaging station, January flows
    reached 4,300 cubic feet per second (cfs) in a channel with a rated
    maximum capacity of 3,000 cfs, 143 percent of channel capacity. March
    flows exceeded 4,700 cfs, or 157 percent of channel capacity. Had the
    Merced County Streams Project's Haystack Mountain Dam been in place, no
    flooding would have occurred along Bear Creek during the January,
    February or March events.
        Due primarily to the New Years, 1997 devastating California flood,
    the U. S. Congress and the California legislature authorized a four
    year study, identified as: ``Sacramento and San Joaquin River Basins
    Comprehensive Study.'' The study was authorized under the Flood Control
    Act of 1962 (Sacramento River) and the 1964 Congressional Resolution
    (San Joaquin River). According to a brochure distributed by The
    Reclamation Board of the State of California and the U. S. Army Corps
    of Engineers, Sacramento District, the study:

              ``. . . will initially identify problems, opportunities,
            planning objectives, constraints, and measures to address
            flooding and ecosystem problems in the study area. It will
            ultimately develop a strategy for flood damage reduction and
            integrated ecosystem restoration along with identification of
            projects for early implementation. Solutions will include
            consideration of both structural and non-structural measures .
            . .''

        According to the study timeline, in April, 1999, an interim report
    will be presented to Congress. In 2001, a Draft Strategy for Flood
    Management and Related Environmental Restoration will be completed. By
    the Spring of 2002, the final Strategy and EIS/EIR, including an
    implementation plan will be completed.
        There is great concern on the part of the City of Merced, County of
    Merced and the Merced Irrigation District officials that the Merced
    County Streams Project will be ``swallowed up'' by the Comprehensive
    Study, becoming one of many new flood control projects that have not
    yet received Congressional authorization. The Merced County Streams
    Project has been authorized by Congress. This important and urgent
    Project must not lose its priority for Congressional funding or be
    further delayed while the Comprehensive Study is undertaken.
        The project has the support of state and local authorities and
    funding of the non-federal portion has been addressed.
        We request the Committee's support for the inclusion of $500,000 in
    the 1998/99 budget, as recommended by the California Water Commission
    and the Corps of Engineers, for the orderly progress of the Merced
    County Streams Project, which is so vital to the community, state, and
    the nation.
                                     ______

          Prepared Statement of Milton Losoya, Mayor, City of Woodland
        The City of Woodland requests Congressional support for adding
    $750,000 to the fiscal year 2000 federal budget, to enable the Corps of
    Engineers to begin the Cache Creek Flood Protection Feasibility Study
    in fiscal year 2000. The study, estimated to cost $2,500,000 million
    over a 2-3 year period, will be 50 percent federally funded, 50 percent
    state and local funded. The City Council has approved the City funding
    for the local share.
        FEMA has recently completed a new Flood Insurance Study for the
    Woodland area, showing approximately a 600 percent increase in the area
    of the city in the 100 year flood plain. This creates a significant
    impact to existing residences and businesses, and a virtual building
    moratorium on new industrial development, which is now predominately in
    an unnumbered A zone. This will have major economic impact on the City
    of Woodland if not addressed in an expeditious and proactive manner.
        The Corps of Engineers has completed two Reconnaissance Studies
    (Reconnaissance Report, Westside Tributaries to Yolo Bypass, CA June
    1994, and Northern California Streams Reconnaissance Report, Cache
    Creek Environmental Restoration, California, December 1995) which
    address structural solutions to this problem. The Corps studies show a
    benefit cost ratios of between 1.3 and 1.8 depending on the solution
    selected. Analysis indicates that the flood threat has been intensified
    by the construction of Interstate Highway I-5, which diagonally bisects
    the community. Considering projected damage estimates for the 100 year
    flood, the project shows a 1.8 benefit cost ratio. The annualized cost
    for flood protection is about half the annualized cost of damages from
    a 100 year flood. With the receipt of the proposed revisions to FEMA's
    Flood Insurance Rate Maps, there is clear community support to proceed
    with a structural fix to the flood protection system.
        The next step is completion of a Corps feasibility study to
    determine the optimum solution for the community, so that design can
    begin. Given the impacts to the community, a two year schedule for the
    study is desired so that we may proceed as soon as possible with a
    structural fix (costs of which are estimated by the Corps to range from
    $42,000,000 to $84,000,000).
                                     ______

     Prepared Statement of the Honorable George Pettygrove, Mayor, City of
                             Fairfield, California
        Mr. Chairman, Members of the Subcommittee, my name is George
    Pettygrove. I am the Mayor of the City of Fairfield, California. The
    City of Fairfield requests $400,000 in the fiscal year 2000 Energy and
    Water Appropriations bill to continue funding for the Ledgewood Creek
    Section 205 Small Flood Control Project.
        In fiscal year 1999, Congress provided $300,000 to begin study of
    flooding on Ledgewood Creek. The requested appropriation in fiscal year
    2000 will complete the feasibility study necessary to determine
    appropriate flood control measures for this area of the City.
        When the Corps of Engineers studied Ledgewood Creek in preparation
    for the design of the Fairfield Vicinity Streams Project improvements,
    the Corps predicted that Ledgewood Creek, within the unincorporated
    area of Solano County, could bifurcate and flood Interstate Highway 80
    (I-80). On Tuesday, February 3, 1998, the prediction came true. Runoff
    from the Ledgewood Creek drainage basin could not be contained within
    the unimproved creek channel and the creek overflowed. At 7:44 a.m. all
    four westbound lanes of I-80 and three of the four eastbound lanes were
    closed. Within an hour after the closure, the freeway became a giant
    parking lot, spanning nearly 15 miles east to Interstate 505. At its
    worst, 18 inches of water covered four westbound lanes for roughly 600
    feet. Caltrans reopened the freeway at 12:38 p.m., the result of
    naturally receding water, lighter showers, and Caltrans' crews pumping
    water back into the creek. The five hour closure of I-80 caused some
    commuters to be three hours late to work, as well as trucking delays in
    delivery of goods.
        Due to a combination of the construction of the Fairfield Vicinity
    Streams Project and the construction of developer improvements, a
    portion of Ledgewood Creek has been improved to carry a 100-year storm
    water event from the Fairfield City limits to the Suisun Marsh. The
    solution to the flooding problem on I-80 is to extend the 100-year
    improvements to the north to include an upper reach of Ledgewood Creek
    from the Fairfield City limits to Abernathy Lane. If the Abernathy Lane
    crossing and the downstream channel of Ledgewood Creek are improved,
    bifurcation will be eliminated and so will the flooding of I-80. Also,
    the Corps of Engineers could submit their design with calculations to
    FEMA and obtain a letter of map revision to remove all of the
    properties below I-80 that are within the AO flood zone. The benefit to
    the community is not only the prevention of the I-80 flooding, but the
    removal of approximately 300 acres of residential, commercial, and
    industrial property from the FEMA flood zone, thereby eliminating the
    need to buy flood insurance.
        Again, I appreciate the opportunity to testify on behalf of the
    City of Fairfield, and I urge your support for this priority project
    for our region.
                                     ______

        Prepared Statement Jon D. Mikels, Chairman, Supervisor, Second
                       District, County of San Bernardino
        The Board of Supervisors of San Bernardino County, State of
    California, appreciates the opportunity to bring the following flood
    control and water conservation projects to your attention for
    consideration in the fiscal year 1999-2000 Federal Budget.

    Corps of Engineers:
        Santa Ana River Mainstem--Construction of Seven Oaks
          Dam, San Timoteo Creek Reach 3B and Lower Santa
          Ana River Reaches 8 & 9. New construction start
          for Prado Dam.....................................     $28,000,000
        Upper Santa Ana River Watershed--Reconnaissance
          Study.............................................         100,000
        Orange County, Santa Ana River Basin--Feasibility
          Study.............................................         100,000
        Mojave River Forks Dam--Feasibility Study...........         300,000
        San Bernardino County Feasibility Studies--a. Lytle
          Creek, b. Wilson, Potato and Wildwood Creeks......         100,000
        Mission Zanja Creek--Feasibility Study..............         ( \1\ )
    Bureau of Reclamation: San Sevaine Creek Water Project--
        Public Law 84-984 Small Reclamation Projects Act
        Loan Program........................................      10,180,000

    \1\ Support.

        The Board, once again, wishes to express its deep appreciation for
    your past and present support of these priority programs in San
    Bernardino County.
                        santa ana river mainstem project
    Project Description
        The Santa Ana River Mainstem Project includes seven interdependent
    features: Mill Creek Levee, Oak Street Drain, San Timoteo Creek, Lower
    Santa Ana River, Seven Oaks Dam, Prado Dam and Santiago Creek. Mill
    Creek Levee, Oak Street Drain, San Timoteo Creek Reaches 1, 2 and 3A
    and the Lower Santa Ana River Reaches 1, 2, 3, 4, 5, 6, 7 and 10 are
    complete. Completion of all of the features will provide (a) the
    necessary flood protection within Orange, Riverside and San Bernardino
    Counties; (b) enhancement and preservation of marshlands and wetlands
    for endangered waterfowl, fish and wildlife species; (c) recreation
    amenities; and (d) floodplain management of the 30 miles of Santa Ana
    River between Seven Oaks Dam and Prado Dam.
    San Bernardino County Features Status
        Seven Oaks Dam: Intake structure excavation, abutment stripping and
    outlet works/diversion tunnel contract is complete. Embankment and
    spillway construction contract was awarded in March 1994. Construction
    is progressing satisfactorily and is 91 percent complete as of January
    1999. Construction can be completed in fiscal year 1999/2000.
        San Timoteo Creek: San Timoteo Creek/Reach 1 construction was
    completed in September 1996. Construction on Reaches 2 & 3A was
    completed in April 1998. Overall, construction is approximately 60
    percent complete.
    Funding Required
        The funding amount required exceeds the President's proposed budget
    by $3,000,000 due to necessary studies and mitigation for endangered
    species. In addition, $5,000,000 is requested for Design and
    Construction start for Prado Dam. To continue construction of the
    Mainstem Project on schedule in fiscal year 1999/2000, federal funding
    in the amount of $28,000,000 would be required as follows:

    Seven Oaks Dam: Construction and Mitigation.............      $3,000,000
    Lower Santa Ana River:
        Construct Reaches 8 & 9.............................      13,000,000
        Landscaping and Sediment Removal....................       5,000,000
        Engineering Design..................................       2,000,000
    Prado Dam: Design and Construction start................       5,000,000

        PROJECT AUTHORIZED: Public Law 94-587, Section 109, Approved
    October 22, 1976, Public Law 99-662, Water Resources Development Act of
    1986
        TOTAL PROJECT COST: $1,400,000,000--Includes $473,000,000 local
    share

    PRESIDENT'S BUDGET FISCAL YEAR 1999/2000................     $20,000,000
    FUNDING SHORTFALL FISCAL YEAR 1999/2000.................       8,000,000
    REQUIRED FUNDING FISCAL YEAR 1999/2000..................      28,000,000

        REQUESTED ACTION: Approval of $28,000,000 for Santa Ana River
    Mainstem, F.Y. 1999/2000.
                               san timoteo creek
    Project Description
        The San Timoteo Creek is a major tributary to the Santa Ana River
    in the east San Bernardino Valley. A large watershed of approximately
    126 square miles drains into the creek which flows through the cities
    of Redlands, Loma Linda and San Bernardino before discharging into the
    Santa Ana River. The existing creek, in all three cities, has an
    earthen bottom and partially improved embankments reinforced with rail
    and wire revetments.
        Major storm flows along the creek in 1938, 1961, 1965, 1969 and
    1978 caused considerable damage to the creek itself as well as
    overtopping the banks and causing loss of life and severe property
    damage.
        The Energy and Water Development Appropriations Act of 1988
    authorized improvement of San Timoteo Creek as part of the Santa Ana
    River Mainstem Project. The improvements include the construction of
    approximately 5.5 miles of concrete-lined channel from the Santa Ana
    River upstream through the cities of San Bernardino, Loma Linda and
    Redlands plus the construction of debris retention facilities at the
    upstream end of the project in the form of in-channel sediment storage
    basins.
    Project Status
        Overall project construction is 60 percent complete. An alternative
    has been developed for Reach 3B that will include the construction of
    approximately 1300 feet of improved channel and 18 in-channel
    sedimentation basins. Plans for the final phase will be developed
    during the remaining 1998/1999 fiscal year with completion anticipated
    during the mid 1999/2000 fiscal year.
    Completed Phases
        Reach 1: 0.7 Mile of Channel, COMPLETED, September 1996; Waterman
    Avenue Bridge, COMPLETED, September 1996.
        Reach 2: 1.9 Miles of Channel, COMPLETED, December 1997; Redlands
    Boulevard Bridge, COMPLETED, March 1998.
        Reach 3A: 0.8 Mile of Channel, COMPLETED, May 1998.
    Remaining Construction and Schedule
        Reach 3B: 0.2 Mile of Channel and 18 Sedimentation Basins along 2.2
    Miles of channel. Plans and Specifications: June 1998-December 1999;
    Right-of-Way Acquisition: April 1999-December 1999; Construction Start:
    April 2000; and Construction Completion: September 2001.
    Estimated Project Cost
        The total estimated project cost is approximately $67,000,000 with
    the federal participating cost at 75 percent or $50,250,000 and the
    local participating cost at 25 percent or $16,750,000. The cost of the
    remainder of the project is estimated to be $35,000,000, with the
    Federal share at $26,250,000 and the local share at $8,750,000
        REQUESTED ACTION: Approval of continued funding for the San Timoteo
    Creek Project.
              upper santa ana river watershed reconnaissance study
        The area will focus on the watershed of the Santa Ana River and
    tributaries located above Prado Dam and primarily in San Bernardino
    County. The study is to describe all watershed characteristics and uses
    to define problem areas under present and future conditions and assist
    county and local interests in developing a long term master plan for
    watershed management in the interest of improving specific water
    resource uses including environmental preservation and restoration,
    urbanization water supply and conservation and water-related recreation
    activities.
        The San Bernardino County Flood Control District supports the
    reconnaissance study for management of the upper Santa Ana River
    Watershed.
        REQUESTED ACTION: Approval of $100,000 for upper Santa Ana River
    Watershed, F.Y. 1999/2000.
         orange county, santa ana river basin feasibility study (chino
                           agriculture preserve area)
        The Chino Dairies are located in a 30 square mile area immediately
    north of Prado Dam reservoir, in the unincorporated portion of San
    Bernardino County, California. The study provides information on the
    following elements: operations of Chino Dairies, water conservation in
    Chino Groundwater Basin, flood control facilities to relieve runoff
    from upstream development in the City of Ontario, water quality
    concerns of Orange County residents and the regulatory enforcement of
    the Chino Dairies. The Chino Dairies provide 25 percent of all the milk
    consumed in California and it is a one billion dollar industry.
        The San Bernardino County Flood Control District supports the
    feasibility study to help with flood control facilities, water
    conservation and keep the dairies maintain their viability.
        REQUESTED ACTION: Approval of $100,000 for Orange County, Santa Ana
    River Basin, F.Y. 1999/2000.
                    mojave river forks dam feasibility study
        The Mojave River flows north out of the San Bernardino Mountains
    into the desert communities of Victorville and Barstow. The Mojave
    River Forks Dam (Dam) is an ungated facility designed and constructed
    by the U.S. Army Corps of Engineers to alleviate flooding. Since that
    time, environmental regulations such as the Endangered Species and
    Clean Water Acts and the recent water rights adjudication have changed
    the River's uses. The study will consider factors such as the current
    water rights adjudication while facilitating balance among the River's
    competing uses and diverse interest. Alternatives include modification
    of the Dam's operation and outlet works, construction of a release
    tower and operable gates and construction of one or more off-line
    detention basins.
        The San Bernardino County Flood Control District supports this
    feasibility phase study to evaluate viable water conservation
    alternatives while optimizing the balance between environmental, flood
    control and water supply needs.
        REQUESTED ACTION: Approval of $300,000 for Mojave River Forks Dam,
    F.Y. 1999/2000.
      san bernardino county feasibility studies (lytle creek and wilson,
                           potato & wildwood creeks)
        The Lytle Creek drainage basin comprises 173 square miles in the
    north-central part of the Santa Ana River Basin, San Bernardino County,
    California. The purpose of the study is to conduct an investigation of
    the Lytle Creek watershed to determine opportunities for water quality/
    flood control enhancement, sediment/erosion control and environmental
    restoration. Sand and gravel operations along the Creek have resulted
    in damages to the drainage patterns, sediment movement and the riparian
    habitat. In addition, a high rate of urbanization in the ``Inland
    Empire'' region has led to increased runoff. These factors pose an
    increase flood risk in the basin.
        Wilson, Potato and Wildwood Creeks originate in the San Bernardino
    Mountains and flow in a south and southwesterly direction through the
    city of Yucaipa, San Bernardino County. The study would investigate
    methods to control erosion and reduce the impacts to the downstream
    open space areas, residences and commercial areas within the watershed.
    The runoff creates a large volume of debris and sediment within the
    City of Yucaipa. Flooding along these creeks is threatening to damage
    residential and commercial development and infrastructure facilities.
        The San Bernardino County Flood Control District is requesting
    these feasibility studies to evaluate the systems and determine
    appropriate methods of protection through new facilities and management
    of the existing floodplain.
        REQUESTED ACTION: Approval of $100,000 for San Bernardino County,
    F.Y. 1999/2000.
                     mission zanja creek feasibility study
        The area is located in the City of Redlands, San Bernardino County.
    The Mission Zanja Creek (Creek) project begins at about 2,000 feet east
    of Interstate 10 to the Reservoir Canyon Drain, just west of 8th
    Street. Floods of 1965, 1976 and 1980 caused about $4,300,000 million
    (1988 price level) in damages. Frequent flooding along the Creek is
    caused by inadequate capacity of the existing inlet to the covered
    channel near 9th Street. The U.S. Army Corps of Engineers study
    indicates that expansion of inlet on the Creek will result in a small
    increase in the level of protection, but will increase flooding the
    areas surrounding Reservoir Canyon Drain. Even though, this project
    will cause flooding at the downstream area, but it will be much
    smaller.
        The San Bernardino County Flood Control District supports the
    feasibility study to improve the inlet of Mission Zanja Creek to reduce
    flooding area.
        REQUESTED ACTION: Support of Mission Zanja Creek, F.Y. 1999/2000.
                        san sevaine creek water project
    Project Description
        The San Sevaine Creek Water Project includes ten recharge
    facilities, two miles of levees; construction of seven miles of
    drainage ways to convey runoff to the recharge facilities; six miles of
    linear parkways; and the preservation of 137 acres of sensitive
    wildlife habitat. This project will provide water conservation and
    flood protection to a drainage area of approximately 51 square miles
    within the cities of Fontana, Rancho Cucamonga and Ontario as well as
    San Bernardino and Riverside Counties. There will be an average of
    approximately 25,000 acre-feet per year of groundwater recharge from
    the San Sevaine and Etiwanda Creeks' tributaries in the project area.
    Project Status
        The Loan Application was signed by the Bureau of Reclamation
    Commissioner Eluid Martinez on April 11, 1996, approved by the
    Secretary of Interior Bruce Babbitt on May 9, 1996. As of July 15,
    1996, the San Sevaine Creek Water Project completed 60-day
    congressional approval process. On December 17, 1996, the project
    Repayment Agreement was approved by the Board of Supervisors of San
    Bernardino County and approved on January 8, 1997 by Robert Johnson,
    Regional Director of the Bureau of Reclamation. The Bureau has
    indicated an eight-year construction schedule with project completion
    by the Year 2006.
        Although considerable levee, channel and interim basin work has
    already been completed at various locations of this major water
    project, continued federal assistance from this Small Reclamation
    Project Act loan and grant are required to complete the project's
    construction. Without these funds it will be decades before local
    interests can accrue sufficient funds to construct this vital water
    project. To date, the Bureau of Reclamation has provided approximately
    $10,500,000 million towards construction of the project.
        The California Water Commission has consistently, since the late
    1980's, supported the construction of this project.
                                                          Public Law 84-984,
            Federal Authority                             as amended in 1956
    Bureau of Reclamation grant contribution approximately..     $27,400,000
    Bureau of Reclamation loan contribution approximately...      19,200,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total B of R project (not additive) Approximately.      52,900,000
                        ========================================================
                        ____________________________________________________
    Total Local Contribution Approximately..................      33,700,000
    1997/98 fiscal year Federal Budget (New Project Start)..       1,333,000
    1998/99 fiscal year Federal Budget......................       1,177,000
    President's Budget fiscal year 1999/2000................      10,180,000

        The District and County have coordinated with the Bureau of
    Reclamation and the National Water Resources Agency in a cooperative
    effort to obtain the continued funding for this project. The District
    and County appreciate the continuing support provided by the Bureau of
    Reclamation towards this project.
        REQUESTED ACTION: Support President's proposed F.Y. 1999/2000
    budget in the amount of $10.18 Million.
                                     ______

    Prepared Statement of Keith E. Beier, Mayor Pro Tem, City of Escondido,
       California, and Marie Waldron, Council Member, City of Escondido,
                                   California
                    san diego area water reclamation program
        Mr. Chairman and members of the subcommittee, for the seventh
    straight year, we are pleased to have the opportunity submit this
    testimony in support of continued funding for the San Diego Area Water
    Reclamation Program, including the Escondido portion. Let us say again
    how much we appreciate what you have done for the people of Escondido.
        Last year, the Congress provided $13,000,000 for this project, as
    requested by the Administration. And, as we reported to you last year,
    with the support we had received through fiscal year 1999 from Congress
    and the Administration, we were able to move the project forward in
    full compliance with our agreement with the Bureau of Reclamation. We
    hope you will be able to provide $10,600,000 for the total project,
    fully funding the President's fiscal year 2000 Budget Request. We know
    that the budget caps and the other priorities in the President's budget
    request place you under enormous fiscal pressure, but we feel confident
    in asking for full funding because the people of Escondido still need
    usable water and it is still a fact that our surrounding area is a
    desert with increasing dependence on reusable water. Let us again point
    out that we will reclaim and reuse a large amount of the wastewater
    that we now pump into the Pacific Ocean at a rate of 14,500,000 gallons
    per day.
                    the escondido water reclamation program
        As we must continue to report to you, San Diego County, especially
    the North County where Escondido is located, continues to experience a
    tremendous population influx that has gone on since the early 1960s.
    With the population growth that Escondido continues to experience, has
    come dramatic new economic development, both in the number of new
    businesses and our existing, historical agriculture industry. All place
    new demands on our infrastructure and our water supply--both potable
    and nonpotable. Through local planning and leadership, Escondido
    continues to attempt to meet the challenge of maintaining a high
    quality of life for its people, and, with this subcommittee's continued
    support, can make it a reality.
        While our specific program is important to the citizens of
    Escondido, we remain a key part of the overall water planning effort of
    San Diego County. As part of the San Diego Area Water Reclamation
    Program, we are pleased with the increased amount of water that will be
    made available to the county as a result of this program.
                             cost and funding data
        With respect to the Escondido portion of the project, we are please
    to report that, through fiscal year 1999, Escondido has spent more than
    $14,000,000 on design, preliminary studies, environmental documents,
    right of way purchases and construction of improvements at the Hale
    Avenue Resource Recovery Facility (HARRF) and reclaimed water
    pipelines. With your approval, since fiscal year 1994, Bureau of
    Reclamation funding has reached $3,485,649. Phase I improvements to the
    HARRF construction is well under way, and Phase II, which includes
    completion of the improvements at the HARRF and construction of the
    reclaimed water pipelines, pump stations and reservoir, will commence
    construction in early fiscal year 2000.
        We would be remiss in our stewardship of your support if we did not
    report to you that the cost of the Escondido Regional Water Reclamation
    Program in 1999 dollars has increased to $76,575,000. This is a sharp
    increase in the project costs and is a reflection of a robust
    construction economy in southern California. Region wide construction
    costs have increased by a magnitude of 20 percent in the last two
    years.
        We are pleased that the California Water Commission again has
    supported our program as a recommended program, and continue to be
    thankful for the support of our sister agencies that comprise the San
    Diego Area Water Reclamation Program. This program has been favorably
    reviewed by this subcommittee and your counterpart in the other body,
    the Bureau of Reclamation, the California Water Commission, and
    regional officials back home in San Diego County.
        In closing, we are at the point of making large financial
    commitments to our water reclamation and redistribution program and
    would not be able to do so without the past and present support of the
    Senate and House Appropriations Subcommittees on Energy and Water. And,
    as our fiscal commitments increase, our dependence upon support from
    Congress and the Bureau of Reclamation funding increases. Let us again
    express our thanks and our appreciation for the support you have
    provided. We respectfully request your continued support, and would be
    delighted to respond to any questions the Subcommittee may have.
                                     ______

      Prepared Statement of the County of San Joaquin and the San Joaquin
        County Flood Control and Water Conservation District, California
        San Joaquin County, located in the heart of California's central
    valley, has both a vibrant agricultural economic base and a burgeoning
    metropolitan growth. Both of these vital elements are vulnerable to the
    forces of nature. The 1997 flood inundated thousands of acres and
    threatened our major urban areas. The actual economic loss to the
    County in 1997 was staggering ($100+ million) and the potential loss
    due to flooding is enormous. The San Joaquin Area Flood Control Agency
    (SJAFCA) has been formed and construction is nearly complete (a
    $70,000,000 investment) to restore the Stockton Metropolitan Area to a
    100-year level of flood protection. We have aggressively moved ahead
    with this work to protect our people in anticipation that a credit for
    our work would be forthcoming against a Corps-developed project. We are
    anxiously waiting for the Corps' completion of the Section 211
    reimbursement study.
        At the other extreme of the weather spectrum, San Joaquin County is
    very vulnerable to drought-induced water shortages. Due to the export
    of our water by East Bay Municipal Utility District to the Oakland area
    and by the Bureau of Reclamation to the CVP, San Joaquin County is
    deficient of an adequate water supply in quantity and quality. Our
    groundwater levels dramatically drop during a less-than-average water
    year. During these drops, the threat of salt water intrusion in our
    groundwater basin from the Delta is a major concern. Our local water
    district (Stockton-East Water District) has invested $65,000,000 to
    allow transfer of Stanislaus River flows to supplement our water
    supplies, but this project is dependent on the coordinated operation of
    New Melones Reservoir and local storage capability during wet years. We
    need to have the Corps complete the feasibility study of the Farmington
    Dam recharge project in order to increase the yield of the severely
    limited Stanislaus River supply.
        As you can see, we are willing to invest in our future and we will
    continue to do so. The timely funding of these important studies is
    crucial to the economic well-being of San Joaquin County. These
    projects represent studies that need to be conducted in order to
    resolve problems on flood control, water supply, water quality,
    groundwater and the environment in San Joaquin County. We need Federal
    help in several of these projects and we request Federal appropriations
    during fiscal year 2000 for the following Corps of Engineers and Bureau
    of Reclamation projects:

    U. S. Army Corps of Engineers--General Investigations-Surveys:
        Sacramento and San Joaquin Rivers Comprehensive Study.....$3,000,000
        Sacramento and San Joaquin Delta Investigations...........   200,000
        San Joaquin River Basin Stockton Metropolitan Area
          (Section 211) Requesting an Additional $180,000.........   380,000
        San Joaquin River Basin Stockton Metropolitan Area
          (Farmington Dam)........................................   150,000
        San Joaquin River Basin Cosumnes and Mokelumne Rivers.....    50,000
        Port of Stockton and San Joaquin River Channel Deepening..   150,000
    Bureau of Reclamation:
        South Delta Barriers......................................    20,000
        Bay-Delta Ecosystem Restoration--CALFED...................95,000,000
                               detailed comments

    U.S. Army Corps of Engineers

    Sacramento and San Joaquin Rivers Comprehensive Study.........$3,000,000

        The San Joaquin Rivers Comprehensive Study is an ongoing $9,000,000
    study of the water resources needs of the San Joaquin and Sacramento
    Rivers. Flood control and environmental needs will receive equal
    consideration. We expect setback levees, dredging and re-operation of
    existing reservoirs will receive a careful review in this study. A
    status report to Congress is expected to be released this April, which
    will outline $16,000,000 to $20,000,000 of studies to be performed in
    future years. The President approved $3,500,000 for fiscal year 1999
    and $2,000,000 for fiscal year 2000 for the collective San Joaquin and
    Sacramento River Basin Studies. At this time, we do not know the exact
    allocation between each of the basins, although 50-50 seems likely. The
    State is the cost-sharing partner in these studies.

    Sacramento-San Joaquin Delta Investigation....................  $200,000

        This is a special study and a regional planning report which
    addresses multiple resource needs, including flood control, recreation,
    environmental restoration, navigation, water supply, etc. The
    California Department of Water Resources is the cost-sharing partner
    with the CALFED process. To date, field test levee-strengthening
    methods have been pursued and the study provides input to the CALFED
    process. The President's budget for this investigation for fiscal year
    2000 is $200,000.

    San Joaquin River Basin Stockton Metropolitan Area............  $380,000

        Before Federal dollars can be appropriated to reimburse the local
    agency (up to 75 percent reimbursement), a Section 211 Report must be
    approved by the Secretary of the Army. The 211 Report should be
    completed later this year or early next year. The President's fiscal
    year 2000 budget of $200,000 is adequate to complete the required 211
    Report, but an additional $180,000 is required to adequately proceed
    with the Feasibility Report addressing rural flood control
    improvements. The Corps' Draft Feasibility Report is due in August 1999
    and the Final Feasibility Report is due in March 2000.

    San Joaquin River Basin Stockton Metropolitan Area Farmington
        Dam.......................................................  $150,000

        The study costs for this investigation will determine if a Federal
    interest may exist for a groundwater recharge project and environmental
    enhancements. The President has included $150,000 in his fiscal year
    2000 budget. The current fiscal year 1999 budget includes $400,000.
    Since this is a feasibility study, all Federal funds must be matched by
    local funds. The local cost-sharing sponsor for this study will be the
    Stockton East Water District.

    San Joaquin River Basin Cosumnes and Mokelumne Rivers.........   $50,000

        A Reconnaissance Study of ecological restoration and non-structural
    flood control improvements is being performed on the Mokelumne and
    Cosumnes Rivers. The current fiscal year 1999 funding is $18,000 and
    the President's fiscal year 2000 budget is $50,000. Separate studies
    and reports are being prepared by April 1999 for the Cosumnes River
    (between the Delta and Michigan Bar) and the Mokelumne River (between
    the Delta and Camanche Reservoir).

    Port of Stockton and San Joaquin River Channel Deepening......  $150,000

        This is an ongoing feasibility study which is being performed for
    dredging and deepening the San Joaquin River channel through the Delta
    to the port of Stockton to depths of 40 feet. Greater depths will
    enhance navigation through the Delta to and from the Port. A fiscal
    year 2000 budget of $150,000 has been proposed to perform the surveys.
    Please note that this project is not included on the California Water
    Commission's project listing because it is included in the California
    Marine Affairs and Navigation Conference (CMANC) listing of projects.

    Bureau of Reclamation

    South Delta Barriers..........................................   $20,000

        The project provides temporary barriers in the south Delta to
    improve water quality. The fiscal year 1999 Budget includes funding for
    $200,000 and the President's fiscal year 2000 Budget includes funding
    for $20,000. In order to maintain the temporary program, $20,000 is
    needed and the California Water Commission may be requested to
    recommend an increase in funding.

    Bay-Delta Ecosystem Restoration.........................     $95,000,000

        Current year funding is for $143,300,000 and the President's fiscal
    year 2000 Budget has included $95,000,000. Funds for this program have
    been used primarily for acquisition of lands, development of habitat,
    and fishery enhancement/protection improvements. Although we support
    CALFED's assistance with Woodbridge Irrigation District's efforts of
    enhancing the Mokelumne River, we are concerned that the overall CALFED
    program is overlooking the need of surface and groundwater supply
    requirements within the County of San Joaquin. The CALFED program does
    not recognize county area of origin protections; and there are no water
    quality improvement objectives to improve the water quality of San
    Joaquin County water supplies. There is no documentation of the
    benefits that will be derived from the expenditure of funds,
    particularly to displace agricultural lands.
                                     ______

    Prepared Statement of the Santa Clara Valley Water District, San Jose,
                                   California
                            calfed bay-delta program
        Background.--In an average year, half of Santa Clara County's water
    supply is imported from the San Francisco Bay/Sacramento-San Joaquin
    Delta estuary (Bay-Delta) watersheds through three water projects: The
    State Water Project, the federal Central Valley Project, and San
    Francisco's Hetch Hetchy Project. In conjunction with locally-developed
    water, this water supply supports nearly 1,700,000 residents in the
    Santa Clara County, the most important high-tech center in the world.
    In average to wet years, there is enough water to meet the county's
    long-term needs. In dry years, however, the county could face a water
    supply shortage of as much as 100,000 acre-feet per year, or roughly 20
    percent of the expected demand. In addition to shortages due to
    hydrologic variations, the county's imported supplies have been reduced
    due to regulatory restrictions placed on the operation of the state and
    federal water projects.
        There are also water quality problems associated with using Bay-
    Delta water as a drinking water supply. Organic materials and
    pollutants discharged into the Delta, together with salt water mixing
    in from San Francisco Bay, have the potential to create disinfection-
    by-products that are carcinogenic.
        Santa Clara County's imported supplies are also vulnerable to
    extended outages due to catastrophic failures such as major earthquakes
    and flooding. And as demonstrated by the recent flooding in Central
    Valley, the levee systems can fail and the water quality at the water
    project intakes in the Delta can be degraded to such an extent that the
    projects cannot pump from the Delta.
        Project Synopsis.--The CALFED Bay-Delta Program is an
    unprecedented, cooperative effort among federal, state, and local
    agencies to restore the Bay-Delta. With input from urban, agricultural,
    environmental, fishing, and business interests, and the general public,
    CALFED is developing a comprehensive, long-term plan to address
    ecosystem and water management issues in the Bay-Delta.
        Restoring the Bay-Delta ecosystem is important not only because of
    its significance as an environmental resource, but also because failing
    to do so will stall efforts to improve water supply reliability for
    millions of Californians and the state's $700,000,000,000 economy and
    job base.
        Although the CALFED Bay-Delta Program is a long-range planning
    process, ecosystem restoration is an immediate priority because of the
    substantial lead time needed to produce ecological benefits. Species in
    the Bay-Delta continue to be proposed for listing under the Endangered
    Species Act. Recovery efforts cannot begin until adequate funding
    becomes available to implement the array of critical ecosystem
    restoration and water quality projects.
        Fiscal Year 1999 Funding.--$75,000,000 was authorized in fiscal
    year 1999 for CALFED Bay-Delta ecosystem restoration.
        Fiscal Year 2000 Funding Recommendation.--It is requested that the
    Congressional Committee support $95,000,000 in the Administration's
    fiscal year 2000 Budget to finance early implementation of ecosystem
    restoration in the Bay-Delta, provide critical improvement in water
    supply and water quality, and the continuance of final programmatic
    EIS/EIR.
                            guadalupe river project
        Background.--The Guadalupe River is a major waterway flowing
    through a highly developed area of San Jose, California. Historically,
    the river has flooded downtown San Jose and Alviso beyond local
    prevention capabilities. According to the 1991 General Design
    Memorandum, estimated damages from a 1 percent flood in the urban
    center of San Jose are over $526,000,000. The Guadalupe River
    overflowed in February 1986, January 1995, and March 1995, damaging
    homes and businesses in the St. John and Pleasant Street areas of
    downtown San Jose. In March 1995, heavy rains resulted in four separate
    breakouts along the river, inundating close to 300 homes and business.
        Project Synopsis.--In 1971, the local community requested that the
    U.S. Army Corps of Engineers (Corps) reactivate its earlier study.
    Since 1972, substantial technical and financial assistance has been
    provided by the local community through the Santa Clara Valley Water
    District in an effort to accelerate the project's completion. To date,
    more than $70,500,000 in local funds have been spent on planning,
    design, land purchases, and construction, and projects in the Corps'
    project reach, as well as in reaches downstream of the Corps' limits,
    have been completed through the local community's efforts.
        The Guadalupe River Project received authorization for construction
    under the Water Resources Development Act of 1986; the final General
    Design Memorandum was completed in 1992; the local cooperative
    agreement was executed in March 1992; construction of the first phase
    of the project was completed in August 1994; construction of the second
    phase was completed in August 1996. Completion of the last phase in
    2002 is dependent on federal funds and mitigation issue resolution.
        To achieve a successful, long-term resolution to the issues of
    flood protection, environmental mitigation, avoidance of environmental
    impacts, and project maintenance cost, a multi-agency ``Guadalupe Flood
    Control Project Collaborative'' was created in 1997. A key outcome of
    the collaborative process was the signing of the Dispute Resolution
    memorandum in 1998, which resolved major mitigation issues and allows
    the project to proceed.
        Fiscal Year 1999 Funding.--$7,000,000 was authorized in fiscal year
    1999 to continue Guadalupe River Project construction.
        Fiscal Year 2000 Funding Recommendation.--Based upon the need to
    continue construction to provide critical flood protection for downtown
    San Jose and the community of Alviso, it is requested that the
    Congressional Committee support $5,000,000 in the Administration's
    fiscal year 2000 budget for the continuance of construction and
    mitigation work on the Guadalupe River Flood Protection Project.
                         upper guadalupe river project
        Background.--The Guadalupe River is one of two major waterways
    flowing through a highly urbanized area of Santa Clara County,
    California. Historically, the river has flooded the central district of
    San Jose and southern areas beyond local prevention capabilities.
    According to U.S. Army Corps of Engineers (Corps) 1998 feasibility
    study, severe flooding in the Upper Guadalupe River's densely populated
    residential floodplain south of Interstate 280 could potentially cause
    $280,000,000 in damages.
        The probability of a large flood occurring before implementation of
    flood prevention measures is high. The Upper Guadalupe River overflowed
    in March 1982, January 1983, February 1986, January 1995, March 1995,
    and February 1998, causing damage to several residences and businesses
    in the Alma Street and Willow Street areas. The 1995 floods in January
    and March, as well as in February 1998, closed Highway 87 and the
    parallel light-rail line, a major commute artery.
        Project Synopsis.--In 1971, the Santa Clara Valley Water District
    requested the Corps to reactivate its earlier study. From 1971 to 1980,
    the Corps established the economic feasibility and federal interest in
    the Guadalupe River only between Interstate 880 and Interstate 280. In
    light of the 1982 and 1983 floods, the Santa Clara Valley Water
    District requested that the Corps reopen its study of the Upper
    Guadalupe River upstream of Interstate 280. The Corps completed a
    reconnaissance study in November 1989, which established an
    economically justifiable solution for flood prevention in this reach.
    The report recommended proceeding to the feasibility study phase, which
    began in 1990. In January 1997, the Corps determined that the National
    Economic Development Plan would be sized to only provide a 2 percent or
    50-year level of flood protection rather than the 1 percent or 100-year
    level. The Santa Clara Valley Water District strongly emphasized
    overriding the development plan's determination, providing compelling
    reasons for the higher 1 percent or 100-year level of protection. In
    1998, the Acting Secretary of the Army did not concur to extend the
    National Economic Development Plan's 50-year plan to 100 years,
    resulting in a project that will provide less flood protection, and
    therefore, be unable to reduce flood insurance requirements and
    reimbursements, as well as eliminate recreational benefits and increase
    environmental impacts. The Santa Clara Valley Water District has
    requested that the costs of providing 50-year and 100-year flood
    protection be analyzed again during the preconstruction /engineering
    design phase and figured into the determination of the National
    Economic Plan.
        Fiscal Year 1999 Funding.--$575,000 was authorized in fiscal year
    1999 for the Upper Guadalupe River Project to proceed with
    preconstruction engineering and design.
        Fiscal Year 2000 Funding Recommendation.--Based upon the high risk
    of flood damage from the Upper Guadalupe River and the need to continue
    preconstruction engineering and design, it is requested that the
    Congressional Committee support $300,000 in the Administration's fiscal
    year 2000 budget for the Upper Guadalupe River Flood Protection
    Project. Statement of
                         upper penitencia creek project
        Background.--The Upper penitencia Creek Watershed is located in
    northeast Santa Clara County, California, near the southern end of the
    San Francisco Bay. In the last two decades, the creek has flooded in
    1980, 1982, 1983, 1986, 1995, and 1998. While the January 1995 flood
    damaged a commercial nursery, a condominium complex, and a business
    park, the February 1998 flood damaged many homes, businesses, and
    surface streets.
        The proposed project on Upper Penitencia Creek, from the Coyote
    Creek confluence to Dorel Drive, will protect portions of the cities of
    San Jose and Milpitas. The watershed is completely urbanized;
    undeveloped land is limited to a few scattered agricultural parcels and
    a corridor along Upper Penitencia Creek. Based on the U.S. Army Corps
    of Engineers' (Corps) 1995 reconnaissance report, 4,300 buildings are
    located in the flood prone area, 1,900 of which will have water
    entering the first floor. The estimated damages from a 1 percent or
    100-year flood exceed $121,000,000.
        Study Synopsis.--Under authority of the Watershed Protection and
    Flood Prevention Act (Public Law 83-566), the National Resource
    Conservation Service (NRCS) completed an economic feasibility study
    (Watershed Plan) for constructing flood damage reduction facilities on
    Upper Penitencia Creek. Following the 1990 U.S. Department of
    Agriculture Farm Bill, the NRCS watershed plan stalled due to the very
    high ratio of urban development compared to agricultural development in
    the project area.
        The Santa Clara Valley Water District requested that the Corps
    proceed with a reconnaissance study in April 1994 while the NRCS plan
    was on hold. Funds were appropriated by Congress for fiscal year 1995
    and the Corps started the reconnaissance study in October 1994. The
    reconnaissance report was completed in July 1995, with the
    recommendation to proceed with the feasibility study phase. The
    feasibility study, initiated in February 1998, is scheduled for
    completion in 2001.
        Fiscal Year 1999 Funding.--$250,000 was authorized in fiscal year
    1999 for the Upper Penitencia Creek Flood Protection Project for
    project investigation.
        Fiscal Year 2000 Funding Recommendation.--Funding Recommendation.
    Based upon the high risk of flood damage from the Upper Penitencia
    Creek and the need to proceed with the feasibility study, it is
    requested that the Congressional Committee support $250,000 in the
    Administration's fiscal year 2000 Budget for the Upper Penitencia Creek
    Flood Protection Project. Statement of
                              llagas creek project
        Background.--The Llagas Creek Watershed is located in southern
    Santa Clara County, California, serving the communities of Gilroy,
    Morgan Hill and San Martin. Historically, Llagas Creek has flooded in
    1937, 1955, 1958, 1962, 1963, 1969, 1982, 1986, 1996, and 1997. The
    January 1997 flood damaged many homes, businesses, and a recreational
    vehicle park located in areas of Morgan Hill and San Martin areas where
    protection is proposed. Overall, the proposed project will protect the
    floodplain from a 1 percent flood affecting more than 1,100 residential
    buildings, 500 commercial buildings, and 1,300 acres of agricultural
    land.
        Project Synopsis.--Under authority of the Watershed Protection and
    Flood Prevention Act (PL 83-566), the National Resource Conservation
    Service (NRCS) completed an economic feasibility study in 1982 for
    constructing flood damage reduction facilities on Llagas Creek. The
    NRCS completed construction of the last segment of the channel for
    Lower Llagas Creek in 1994, providing protection to the project area in
    Gilroy. The Santa Clara Valley Water District is currently updating the
    1982 environmental assessment work and applying for a U.S. Army Corps
    of Engineers (Corps) 404 Permit for the project areas in Morgan Hill
    and San Martin.
        Until recently, the Llagas Creek Project was funded through the
    traditional PL-566 federal project funding agreement with the NRCS
    paying for channel improvements and the Santa Clara Valley Water
    District paying local costs including utility relocation, bridge
    construction, and right of way acquisition. Due to a steady decrease
    since 1985 of annual PL-566 appropriations, the Llagas Creek Project
    has not received adequate funding from U.S. Department of Agriculture
    to complete the PL-566 project. To remedy this situation, the Santa
    Clara Valley Water District has been working with congressional
    representatives to legally transfer the construction authority from the
    Department of Agriculture to the Corps. In order for Congress to
    support this authorization transfer, the Corps must prepare a decision
    documents to accompany the request. Using available fiscal year 1999
    general investigation funds, the Corps will initiate and complete a
    Limited Re-evaluation report, which will function as the decision
    document.
        Fiscal Year 1999 Funding.--No federal appropriation received in
    fiscal year 1999.
        Fiscal Year 2000 Funding Recommendation.--Based upon the high risk
    of flood damage from Llagas Creek, it is requested that the
    Congressional Committee support the addition of $880,000 in the
    Administration's budget to continue construction of the Llagas Creek
    Project.
               santa clara basin watershed management initiative
        Background.--The Santa Clara Basin Watershed Management Initiative
    was spearheaded in 1996 by the U.S. Environmental Protection Agency,
    the State Water Resources Control Board, and the San Francisco Bay
    Regional Water Quality Control Board for the purpose of establishing a
    practical management process to oversee the effort to balance natural
    systems with urban development in the Santa Clara Basin. Recognizing
    the importance of quality of life and diversity, the initiative's goal
    is to establish an on-going process of managing activities and natural
    processes to maximize benefits and minimize adverse environmental
    impacts for the benefit of the community as a whole. The Santa Clara
    Basin Watershed includes areas in northern Santa Clara County which
    drain into San Francisco Bay, and portions of Alameda and San Mateo
    counties.
        The initiative will address the integration of activities within
    the watershed while focusing on water quality protection. Some of the
    specific issues being addressed include land use and development, water
    supply, flood management, environmental restoration, and the regulatory
    process.
        The Santa Clara Valley Water District is one of many stakeholders
    who continue to demonstrate commitment to this multi-year effort by
    providing funds and actively participating with the initiative's Core
    Group and Working Group. Providing the initiative's direction, the Core
    Group includes representatives of the business community, local
    government, environmental groups, agriculture, resource and regulatory
    agencies, and other interested stakeholders.
        The Initiation phase was completed in December 1996, and the 4-year
    planning phase has commenced with a watershed assessment report that
    provides a preliminary assessment of the watershed's condition based on
    available data. The assessment report is scheduled to be completed in
    March 2000. A state of the watershed report describing alternatives to
    managing the watershed is scheduled to be completed in December 2000.
    The final product of the planning phase will be a comprehensive
    watershed management plan, incorporating stakeholder input and
    extensive public outreach, intended to guide watershed activities into
    the next century as the Santa Clara Basin Watershed Management
    Initiative moves into its implementation phase.
        Section 503 of the 1996 Water Resources Development Act, authorizes
    the U.S. Army Corps of Engineers (Corps) to provide technical and
    planning assistance in the development of a watershed plan for the
    Santa Clara Valley. The Watershed Management Initiative has progressed
    to the point where the Corps' participation is now necessary for
    continuing the watershed assessment and addressing pressing regulatory
    issues.
        Fiscal Year 1999 Funding.--No federal appropriation was authorized
    in fiscal year 1999 for the Santa Clara Basin Watershed Management
    Initiative.
        Fiscal Year 2000 Funding Recommendation.--In order to continue the
    initiative's progress to date, it is requested that the Congressional
    Committee support the addition of $300,000 in the Administration's
    fiscal year 2000 budget to cost-share Santa Clara Basin Watershed
    Management Initiative work, including conducting a watershed
    assessment, developing a data management system, identifying project
    alternatives, and directing stakeholder meetings.
                             central valley project
        Background.--The San Luis Unit of the Central Valley Project is
    located near Los Banos on the west side of the San Joaquin Valley in
    Fresno, Kings, and Merced counties. The San Luis Unit is an integral
    part of the Central Valley Project, delivering water and power supplies
    from the American, Shasta and Trinity rivers to users located in the
    service area.
        Specific facilities of the San Luis Unit are owned, operated, and
    maintained jointly with the state of California. These Joint Use
    Facilities consist of O'Neill Dam and Forebay, San Luis Dam and
    Reservoir, San Luis Pumping-Generating Plant, Dos Amigos Pumping Plant,
    Los Banos and Little Panoche reservoirs, and the San Luis Canal. These
    facilities are essential to the State Water Project's ability to serve
    numerous agricultural, municipal, and industrial water users in the San
    Joaquin Valley and Southern California. Funding for the Joint Use
    Facilities are divided to 55 percent state and 45 percent federal,
    under provisions of Federal-State Contract No. 14-06-200-9755, December
    31, 1961.
        Within the Central Valley Project, the Joint Use Facilities of the
    San Luis Unit are an important link to the San Felipe Division, which
    serves as the largest source of water imported into the Santa Clara
    Valley Water District and the San Benito County Water District. All of
    the Central Valley Project water delivered through the San Felipe
    Division must be pumped through O'Neill Dam and Forebay and San Luis
    Dam and Reservoir.
        Project Synopsis.--Annual invoices from the state of California for
    the federal share of operation and maintenance costs average
    approximately $10,000,000. For several years, federal funding was
    inadequate to cover the pro-rated federal share of Joint Use Facility
    costs. The Santa Clara Valley Water District intervened by using the
    contributed Funds Act to direct a $20,000,000 advance payment of its
    Central Valley Project capital costs toward an operations and
    maintenance payment.
        As a contractor of both the Central Valley Project and the State
    Water Project, the Santa Clara Valley Water District hopes to
    expediently resolve the issue of unreimbursed operations and
    maintenance expenses. These expenses are carried by the state without
    interest, seriously impairing the cash flow and financial management of
    the State Water Project.
        In fiscal year 1998, an agreement was reached between the U.S.
    Bureau of Reclamation and project contractors to provide direct funding
    for project conveyance and pumping facilities, reducing annual
    appropriations from approximately $10,000,000 to $3,500,000.
        Fiscal Year 1999 Funding.--$3,500,000 was authorized in fiscal year
    1999 for operations and maintenance of the San Luis Joint Use
    Facilities.
        Fiscal Year 2000 Funding Recommendation.--Based upon past
    expenditures, it is requested that the Congressional Committee support
    $4,525,000 in the Administration's fiscal year 2000 budget to continue
    operations and maintenance of the San Luis Unit Joint Use Facilities.
               san jose area water reclamation and reuse program
        Background.--The San Jose Area Water Reclamation and Reuse Program,
    also known as the South Bay Water Recycling Program, will allow the
    city of San Jose and its tributary agencies of the San Jose /Santa
    Clara Water Pollution Control Plant to protect endangered species
    habitat, meet receiving water quality standards, supplement Santa Clara
    County water supplies, and comply with a mandate from the U.S.
    Environmental Protection Agency and the California Water Resources
    Control Board to reduce wastewater discharges into San Francisco Bay.
        The Santa Clara Valley Water District is participating with the
    city of San Jose in the development of the reclamation and reuse
    program. Toward this end, the Santa Clara Valley Water District is
    assisting the city of San Jose by providing financial support and
    technical assistance, and acting as a liaison for water retailers. The
    design, construction, construction administration, and inspection of
    the program's transmission pipeline and Milpitas 1A Pipeline was
    performed by the Santa Clara Valley Water District under contract to
    the city of San Jose.
        The city of San Jose is the program sponsor for Phase 1, consisting
    of almost 60 miles of transmission and distribution pipelines, pump
    stations, and reservoirs. Completed at a cost of $140,000,000, Phase 1
    is scheduled for full operation in May 1999 with expected deliveries of
    5,000 acre-feet per year of recycled, nonpotable water.
        Phase 2 planning is now underway. A study, to be completed in 1999
    at a cost of approximately $3,500,000, will provide a master plan for
    the years 2005 and 2020. Phase 2's near-term objective is to increase
    deliveries by the year 2005 to 15,000 acre-feet per year.
        In 1992, PL 102-575 authorized the Bureau of Reclamation to work
    with the city of San Jose and the Santa Clara Valley Water District to
    plan, design, and build demonstration and permanent facilities for
    reclaiming and reusing water in the San Jose metropolitan service area.
    The city of San Jose reached an agreement with the Bureau of
    Reclamation to cover 25 percent of Phase 1's costs, or approximately
    $35,000,000; however, federal appropriations have not reached the
    authorized amount.
        Fiscal Year 1999 Funding.--$3,000,000 was authorized in fiscal year
    1999 for project construction.
        Fiscal Year 2000 Funding Recommendation.--It is requested that the
    Congressional Committee support an additional appropriation of
    $7,000,000 to the $3,000,000 included in the Administration's fiscal
    year 2000 budget, for a total of $10,000,000 to fund the Phase 2 study
    and cover congressionally authorized appropriations for Phase 1 work.
                                     ______

      Prepared Statement of the San Diego, California, Water Reclamation
                                    Program
        The City of San Diego provides water service as well as wastewater
    collection, treatment and disposal service to a growing metropolitan
    area of two million people. The City receives 90 percent of its water
    supply from Colorado River and northern California sources, hundreds of
    miles distant from the City. Located at the tail end of this extensive
    aqueduct supply system, San Diego is most vulnerable to outages or
    reductions in supplies from these sources. In conjunction with its
    wholesale water supplier, the San Diego County Water Authority, the
    City is engaged in a long-term effort to reduce regional reliance on
    imported water supplies. The San Diego Water Reclamation Program is
    critical to the success of this effort.
        The City will have invested over $365,000,000 in water reclamation
    facilities through this fiscal year, and has programmed another
    $70,000,000 in fiscal year 2000 to continue these efforts. Upon
    completion of the water reclamation and recycling projects in the next
    20 years, the City will have well over $1,000,000,000 of capital
    investment in this program. The City's projects include 4 new and one
    expanded water reclamation plants with a combined capacity of
    70,000,000 gallons per day. The 30 mgd North City Water Reclamation
    Plant has been in operation and delivering reclaimed water to customers
    since September 1997, and the 7 mgd first phase of the South Bay Water
    Reclamation Plant is currently under construction. Also included are
    over 125 miles of reclaimed water distribution system pipelines, and a
    groundwater project providing for conjunctive use of reclaimed water
    and other sources of supply.
        Section 1612 of Public Law 102-575, the Central Valley Project
    Improvement Act, authorizes the Secretary of the Department of Interior
    to provide financial support for water reclamation projects in the San
    Diego area. The U.S. Bureau of Reclamation is authorized to participate
    in the planning, design and construction of water reclamation projects
    serving the San Diego area at a federal cost-share of up to 25 percent.
    Based on the criteria established by the Bureau of Reclamation
    regarding funding eligibility, approximately $168,000,000 through this
    fiscal year, and $193,000,000 of the projected expenditures through
    fiscal year 2000 are eligible for federal funding. Nearly half of the
    $1,000,000,000 of projected expenditures over the next 20 years would
    be eligible for the 25 percent federal funding.
        These costs represent a heavy financial burden for the City to bear
    alone. Federal participation will help make this innovative water
    supply program a reality. Therefore, the City of San Diego respectfully
    requests the Committee to recommend appropriating funds in the amount
    of at least $10,600,000 in fiscal year 2000 for the San Diego region
    through the Bureau of Reclamation program.
    San Diego Area Water Reclamation Program
        The San Diego Area Water Reclamation Program is an ambitious, long-
    term program designed to decrease regional reliance on imported water
    supplies. The Program is a cooperative effort by the cities of San
    Diego, Escondido, and Poway; the Otay Water District; the Padre Dam
    Municipal Water District; the Sweetwater Authority; the Tia Juana
    Valley County Water District; and San Diego County Water Authority.
    Together, these agencies have developed a system of interconnected
    water reclamation projects that will make the best use of existing and
    planned water reclamation facilities and result in a cost effective and
    efficient use of local water resources.
        When completed, the San Diego Area Water Reclamation Program will
    serve an area of more than 700 square miles, from the agricultural
    valleys near the City of Escondido in the north to the expanding
    business centers along the international border with Mexico in the
    south. Ultimately, over 27,000,000,000 gallons (83,000 acre-feet) will
    be added annually to the region's scarce local water supply, more than
    doubling the current average local water supply. Facilities to be
    constructed include up to ten new or expanded water reclamation plants,
    hundreds of miles of reclaimed water delivery pipeline, and a
    groundwater project providing for conjunctive use of reclaimed water
    and other sources of supply.
        Implementation of the San Diego Area Water Reclamation Program will
    produce both economic and environmental benefits. The development of
    local reclaimed water supplies will provide opportunities for
    environmental enhancement projects within San Diego County and reduce
    the demand for imported water from the Sacramento-San Joaquin River
    Delta, an environmentally sensitive water body of national
    significance. The availability of a reliable local water supply is also
    critical to the region's long-term economic health and its ability to
    attract and retain employers. In the near-term, construction of the
    reclamation facilities will stimulate the local economy by creating
    jobs in construction-related industries. After the facilities are
    completed, many high-wage, high-skill jobs will be created in the
    operation and maintenance fields.
        Construction is already under way or completed for a number of
    these reclamation facilities. The City of San Diego has completed the
    construction of its flagship reclamation facility, the 30 mgd North
    City Water Reclamation Plant. Reclaimed water has been delivered to
    numerous customers in the North City area and the City of Poway since
    September 1997. And construction of the City of San Diego's 7 mgd first
    phase of the South Bay Water Reclamation Plant is under way.
        With an annual cost in the range of $900-$1,200 per acre-foot, the
    San Diego Area Reclamation Program is competitive with the development
    of new imported or other local water supplies. However, the level of
    capital investment makes it a heavy financial burden for the local
    agencies. The vast majority of the capital costs would have to be
    funded by local ratepayers. The financial feasibility of this ambitious
    water supply development project, if funded solely with local
    resources, is questionable. Federal participation would provide the
    means to ensure the project is constructed and the benefits realized.
    City of San Diego Regional Water Reclamation Project
        The City of San Diego is undertaking a regional water reclamation
    program which will ultimately provide over 19,600,000,000 gallons
    (60,200 acre-feet) of reclaimed water annually to users within the City
    of San Diego and surrounding communities. The proposed regional
    reclamation system will include four new and one expanded water
    reclamation plants: two in northern San Diego, one in central San
    Diego, and two in southern San Diego near the international border with
    Mexico. These water reclamation facilities will serve agricultural,
    commercial, industrial and residential customers through a network of
    over 125 miles of distribution pipeline, as well as a groundwater
    recharge and extraction project providing for conjunctive use of
    reclaimed water and other sources of supply.
    Northern/Central Regional Water Reclamation System
        The City of San Diego completed construction of its flagship
    reclamation facility, the 30-million-gallon-per-day (mgd) North City
    Water Reclamation Plant (North City WRP), in April 1997. The North City
    WRP could ultimately provide up to 9,800,000,000 gallons (30,000 acre-
    feet) of reclaimed water annually to meet commercial, industrial and
    landscape irrigation demands in northern and central San Diego and the
    southern portions of the neighboring City of Poway. Reclaimed water
    will be delivered to over 750 user sites via an extensive network of
    pump stations and pipelines. The City of Poway has completed a portion
    of its southern reclaimed water distribution system and has been taking
    deliveries from the North City WRP. Initial users in San Diego include
    the internationally known Torrey Pines Golf Course, Marine Corps Air
    Station Miramar, and CalTrans, as well as numerous schools, parks,
    nurseries and residential homeowner associations. The existing North
    City reclaimed water distribution system could be extended to the north
    and the south, and various alternatives are being investigated to
    replace the previously-planned Water Repurification Project, which has
    been discontinued by the City.
        Construction of the North City WRP created badly needed jobs in San
    Diego's construction-related industries. The City estimates that this
    project alone generated 4,400 job-years of work for the local
    community. Construction of the northern/central distribution system is
    expected to generate an additional 4,200 job-years of work. Now that
    the plant is completed, many high-wage, high-skill jobs have also been
    created in the operation and maintenance fields. The development of a
    reliable local water supply will improve the long-term health of the
    San Diego economy by enhancing the region's ability to attract and
    retain employers.
        A future reclamation plant is planned for the commercial center of
    San Diego to supplement reclaimed water from the North City WRP. The
    proposed 8-mgd Mission Valley Water Reclamation Plant (Mission Valley
    WRP) could provide 1,300,000,000 gallons (4,000 acre-feet) of reclaimed
    water annually for the irrigation of schools, parks, commercial and
    tourist facilities, cemeteries, nurseries, golf courses, freeway
    embankments and street medians. This supplemental source of reclaimed
    water would allow the North City WRP to serve new customers in the
    developing communities in northern San Diego.
    South Bay Regional Water Reclamation System
        Construction of the North City WRP has been followed by the
    construction of the 7-mgd first phase South Bay Water Reclamation Plant
    (South Bay WRP) near the international border with Mexico. The Phase I
    South Bay WRP will provide almost 2,300,000,000 gallons (7,000 acre-
    feet) of reclaimed water annually to commercial, industrial, and
    agricultural users in Southern San Diego County. The South Bay WRP and
    southern distribution system, currently scheduled for completion by
    2001, will complement reclamation projects proposed by Otay Water
    District, the Sweetwater Authority, and the Tia Juana Valley County
    Water District, as well as potentially providing reclaimed water to
    Mexico. A future 8 mgd Phase II of the South Bay WRP could provide an
    additional 2,600,000,000 gallons (8,000 acre-feet) of reclaimed water
    annually.
        A future 12 mgd Otay Valley Water Reclamation Plant is also planned
    to provide additional reclaimed water supplies for the southern service
    area.
    San Pasqual Regional Water Reclamation and Groundwater Project
        The City of San Diego recently completed a comprehensive Water
    Resource Management Plan for the San Pasqual Valley. The San Pasqual
    Valley (Valley) is an agricultural preserve located within the
    incorporated limits of the City of San Diego. The majority of the land
    is owned by the City of San Diego and is located between the City of
    Escondido to the north and the community of Rancho Bernardo and City of
    Poway to the south. Based on recommendations resulting from the
    Management Plan, San Diego plans to upgrade the existing 1 mgd San
    Pasqual Reclamation Plant to 5 mgd. The reclaimed water from the
    treatment facility would provide a reliable and noninterruptible water
    supply for agricultural irrigation purposes within the Valley and
    residential and commercial markets within the surrounding community of
    Rancho Bernardo and the northern region of the City of Poway. The
    reclaimed water would also be recharged into the 50,000 acre-foot
    alluvial groundwater basin within the Valley. Groundwater would then be
    extracted and used as peaking water for the reclaimed system in the
    summer months, as well as for domestic potable water supply.
        The expanded San Pasqual Water Reclamation Plant would include
    advanced water treatment in addition to tertiary treatment. Injection
    of the high quality water from the plant would reduce the salinity of
    the groundwater within the basin. This will enhance sensitive
    environmental habitats as well as help farmers reliant on groundwater
    supplies remain economically viable and maintain the San Pasqual
    Valley's agricultural identity. This groundwater/reuse regional project
    will add approximately 2,600,000,000 gallons (8,000 acre-feet) annually
    to local water supplies. Implementation of the project will be subject
    to funds being made available.
        The estimated costs (in 1999 dollars) which are eligible for Bureau
    of Reclamation Title XVI funding for the City of San Diego Water
    Reclamation Program are as follows:

    Northern/Central Regional Water Reclamation System:
        North City WRP......................................     $52,379,000
        North City WRP Demineralization Facilities..........      10,500,000
        Mission Valley WRP..................................      25,541,000
        Northern/Central San Diego Distribution System......     233,914,000
                        --------------------------------------------------------
                        ____________________________________________________
            Subtotal Northern/Central Regional System.......     322,334,000
    South Bay Regional Water Reclamation System:
        South Bay WRP.......................................      33,990,000
        Southern San Diego Distribution System..............      25,768,000
        Otay Valley WRP.....................................      14,880,000
                        --------------------------------------------------------
                        ____________________________________________________
            Subtotal South Bay Regional System..............      74,638,000
    San Pasqual Regional Water Reclamation/Groundwater
        Project.............................................      63,854,000
                        ========================================================
                        ____________________________________________________
            Total City of San Diego Water Reclamation
              Program.......................................     460,826,000
                                     ______

      Prepared Statement of Tib Belza, Chairman, Yuba County Water Agency
    Request
        Please appropriate $700,000 for fiscal year 2000 for the U.S. Army
    Corps of Engineers (USACE) for preconstruction engineering and design
    for the Yuba River Basin, California, levee flood protection
    improvements.
    Issue
        The USACE has completed the Draft Feasibility Report, Yuba River
    Basin Investigation, California, January 1998. The report identifies
    federal interest in approximately $26,000,000 of improvements to
    existing levees. To keep the effort to provide critically needed higher
    levels of flood protection for the area moving forward, the USACE has
    identified that they need $700,000 of federal funding in fiscal year
    2000. The California State Reclamation Board is on record as supporting
    this levee improvement work, and the Yuba County Water Agency (YCWA)
    Board has committed money that is in hand for the local share of this
    critically needed flood protection work.
    Identified Levee Improvements that are Needed
        The USACE recommended plan involves constructing or deepening 6.7
    miles of slurry walls, deepening 9 miles of interior toe drains and
    constructing or modifying 9.5 miles of berms along section of the Yuba
    and Feather Rivers and constructing about 5 miles of slurry walls and
    berms along the ring levee around the City of Marysville. The proposed
    work has an overall benefit-cost ratio of 2.6.
    Flood Protection Need
        The City of Marysville is located at the confluence of two major
    California Rivers, the Feather and the Yuba. Historically the area on
    the average has been subject to major floods about every 8.5 years.
    During the the past 50 years, the area has had five major river floods,
    resulting in a total of 43 deaths and an estimated total damage cost of
    $818,000,000 when brought to 1997 dollars. None of these floods have
    been from levee overtopping, all have been the result of levee
    failures. The most recent major Yuba County flood in January 1997, took
    3 lives, destroyed in excess of 800 homes, flooded 16,000 acres and
    resulted in the largest evacuation in California history. An estimated
    100,000 people were evacuated as a result of this flood. The
    environmental damage was enormous, including vast destruction of
    designated habitat for endangered species.
        Yuba County has probably done more to provide flood protection for
    itself than any County in California. Unfortunately Yuba County is
    consistently in the bottom three counties for per capita income in
    California. Substantial efforts are continuously being undertaken to
    bring economic development to the area, but each time progress is being
    made, another flood occurs, scaring away potential investors.
    Congressional Support Leading to Where We Are
        In 1988 Congress appropriated $500,000 for a USACE Yuba River Basin
    Flood Control Reconnaissance Study. The Reconnaissance Study identified
    federal interest in levee improvements and recommended a Feasibility
    Study. In 1991 the USACE undertook a $2,100,000 Feasibility Study that
    ultimately cost $2,600,000. Half the cost of the Feasibility Study was
    non-federal. The Feasibility Study has identified federal interest in
    approximately $26,000,000 in levee improvements. The $700,000 being
    requested is part of the federal share of levee improvement work
    identified in the recently completed Feasibility Study that has been
    underway since 1991. Since 1988, $1,800,000 in federal funds and a
    total of $3,100,000 have been spent identifying the problem. It is now
    time to move forward with some fixes on the ground.
        On behalf of the flood devastated people of Yuba County, I urge
    that you find a way to provide the USACE with the $700,000 they have
    identified is needed to keep urgently needed flood protection
    improvements for our County moving forward. We are grateful for the
    financial assistance Congress has provided in the past. Thank you.
                                     ______

      Prepared Statement on Behalf of the Nuisance Flooding Near the 3B's
     Portion of the Butte Basin Overflow, Sacramento River, Butte County,
                                   California
        Gentlemen: This project directly affects properties in Butte, Glenn
    and Colusa Counties, as well as the Butte Basin Overflow flood relief
    structure for the Sacramento River.
        Nuisance flooding near the 3B's structure, on the Sacramento River
    north of Ord Ferry Road, has been reported for more than 15 years.
    Butte County has noted a multiplicity of flooding problems in the area,
    bounded by the Sacramento River Big Chico Creek, River Road, Little
    Chico Creek and Ord Ferry Road. Unfortunately, we do not have the
    resources to define the source of all of the problems or to provide
    solutions.
        The most notable and destructive problem is nuisance flooding that
    crosses Ord Ferry and River Roads, when the Ord Ferry Gage on the
    Sacramento River reads between 110, and 114 feet. The Butte Basin flood
    relief facilities are designed to overflow when the Ord Ferry Gage
    exceeds 114 feet. This flooding interrupts interstate commerce closing
    and damaging roads, as well as damaging crops and prohibiting their
    planting/harvesting in all three counties. This also fills the Butte
    Basin Overflow facility, which reduces its flood holding capacity when
    the real flood hits.
        Butte County is requesting a Section 205 Reconnaissance
    Investigation by the Reclamation Board and U.S. Army Corps of Engineers
    to define the problems and solutions.
        If you have any additional questions please contact Stuart Edell,
    Butte County Public Works, 7 County Center Drive, Oroville, CA 95965,
    Telephone (530) 538-7266, FAX (530) 538-7683.
                                     ______

     Prepared Statement on Behalf of the Cherokee Canal, Sediment Removal
                 and Streambed Alteration Project, Butte County
        Gentlemen: This project affects properties in central Butte County,
    between Highway 70 at Pentz Road and Highway 162 at Butte Creek.
        Changes in environmental policies in the last 10 years have
    severely attenuated the mining practices, which have abated the excess
    sediment transport, which is the source of the problem. The sediment is
    the remains of the hydraulic mining operations by the Cherokee Mine in
    the late 1800's. Winter storms transport this sediment from the
    foothills to the flat valley floor where it is deposited in the
    Cherokee Canal Flood Control Project. The excess sediment fills the
    flood control facilities, which reduces their capacity and endangers
    the lives and properties of the resident of Butte County.
        The potential loss of prime agricultural land combined with the
    loss of the Agricultural Experimental Station (the primary source of
    rice seed in California), and the potential pollution from inundation
    fertilizers is too great of a hazard to ignore.
        Re-institution of environmentally sound mining practices upstream,
    combined with a downstream excess sediment removal program, is a
    potential solution. It should reduce the maintenance costs and resolve
    the downstream problem of repeated disturbances to habitat for excess
    sediment removal.
        Butte County's goal is to request a Reconnaissance Investigation by
    the Reclamation Board and U.S. Army Corps of Engineers, looking toward
    an 1135 study.
        If you have any additional questions please contact Stuart Edell,
    Butte County Public Works, 7 County Center Drive, Oroville, CA 95965,
    Telephone (530) 538-7266, FAX (530) 538-7683.
                                     ______

     Prepared Statement of the Department of Water and Power, City of Los
                                    Angeles
        The Department of Water and Power of the City of Los Angeles
    (Department) is the largest municipal utility in the United States
    serving a city of 3,700,000. The Department has traditionally relied
    heavily on imported sources of water to meet the City's needs. Imported
    water continues to be a primary supply. However, drought conditions,
    increased environmental concerns, and limitations on the development of
    additional supplies have led Los Angeles and other cities to utilize
    water conservation and water recycling as alternatives to importing
    more water. The Department's goal is to displace up to 10 percent of
    the city's water supply needs with recycled water by 2010.
        In support of this goal the Department respectfully requests the
    subcommittee's approval and support of an appropriation of $7,500,000
    for the Los Angeles Area Water Reclamation Program as contained in the
    President's budget for fiscal year 1999-00. The budgeted amount for the
    city's East Valley Water Recycling Project (reference Grant Agreement
    No. 1425-5-FG-30-00070) and for the Terminal Island (Los Angeles
    Harbor) Water Recycling Project ( reference Draft Cooperative Agreement
    No. 1425-8-FC-30-00031) is $6,580,000. These projects were authorized
    pursuant to Section 1613 of Public Law 102-575, the Reclamation
    Projects Authorization and Adjustment Act of 1992. Included within this
    budget is $920,000 for the West Basin Municipal Water District.
        The East Valley project will utilize recycled water to recharge a
    local groundwater basin to supplement the city's drinking water supply.
    About 10 of the 13 miles of pipe and over 95 percent of the pump
    station have been constructed. Over $47,000,000 of the total estimated
    $55,000,000 have been spent. Construction is scheduled to be completed
    in April 1999. Project commissioning and testing will start at this
    time. This is the city's largest water recycling project and the
    cornerstone of the city's water recycling program.
        The Terminal Island (Los Angeles Harbor) Water Recycling Project
    will provide advanced treatment of tertiary wastewater and a
    distribution system to deliver recycled water for groundwater recharge,
    and to industrial and irrigation customers. The treatment plant has
    been awarded and construction will begin in May 1999. Design of the
    distribution system is nearly complete. Pipeline construction is
    scheduled to start in March 1999. The total project cost is estimated
    to be $52,000,000. The project will begin supplying water to customers
    by February 2001.
        Mr. Chairman, the Department appreciates the opportunity to submit
    this statement. Thank you for your longstanding support of water
    recycling projects in Southern California.
                                     ______

    Prepared Statement of R. L. Schafer, Secretary/Watermaster, Tule River
                      Association, Porterville, California
        Mr. Chairman and Members of the Committee: The Tule River
    Association hereby request your consideration of an appropriation of
    $800,000 in the fiscal year 2000 Federal budget for the United States
    Army Corps of Engineers for preconstruction engineering and design
    (PED) of the Tule River, Success Reservoir Enlargement Project. The
    President's budget for this line item contains $150,000 which is
    inadequate for an orderly continuation of design of the project.
        The Draft Success Reservoir Enlargement Feasibility Study and EIS/
    EIR are complete, in reproduction and will be issued to the public
    later this month, March 1999. A public hearing has been scheduled in
    Porterville, California on April 22, 1999 and a Chief's report to the
    Congress is scheduled in September 1999. The Success Reservoir
    Enlargement Project is simplistic in design involving raising of the
    existing spillway 10 feet and widening the spillway 165 feet.
        The enlargement project would provide 28,000 acre-feet of
    additional storage space in Success Reservoir and increase the flood
    protection from a 1 in 47 year event to a 1 in 100 year event for the
    City of Porterville and downstream agricultural lands.
        The Corps intends to commence PED in June 1999 and the fiscal year
    1999 appropriation bill contains $100,000 for PED. The estimated Corps
    cost for PED is $1,200,000 which is cost shared 75 percent Federal and
    25 percent non-Federal, and results in a Federal cost of $900,000. The
    Corps has the capability, and as the project is readily designed, PED
    could be completed in fiscal year 2000 with adequate funding.
        The Association urges the subcommittee to support an appropriation
    of $800,000 in fiscal year 2000 for Corps preconstruction engineering
    and design of the Success Reservoir Enlargement Project.
                                     ______

      Prepared Statement of R. L. Schafer, District Engineer Cawelo Water
                       District, Bakersfield, California
        Mr. Chairman and Members of the Committee: The County of Tulare,
    Cawelo Water District, North Kern Water Storage District and Semitropic
    Water Storage District request your consideration of an appropriation
    of $500,000 in the fiscal year 2000 Federal budget for the United
    States Army Corps of Engineers for feasibility studies for the Poso
    Creek Stream Group (Deer Creek, White River, Rag Gulch and Poso Creek).
    The President's budget for the Poso Creek Stream Group Corps general
    investigation for fiscal year 2000 contains $60,000 which is
    inadequate.
        The Corps of Engineers are currently developing a reconnaissance
    study of the four streams of the Poso Creek Stream Group for flood
    control, and it is the opinion of the local sponsors, identified above,
    that the Corps will determine that at least two of the stream studies
    will indicate a Federal interest for continuation of a 50/50 cost
    sharing feasibility study.
        Poso Creek, White River and Deer Creek are uncontrolled streams
    that continue to devastate agricultural lands and flood the communities
    of Earlimart, McFarland, Alpaugh and Allensworth. The major arterials
    State Route 99 and SR 43 have been closed, resulting in the disruption
    of commerce by time delaying detours for several days, during the past
    two years due to flooding from the streams under investigation by the
    Corps.
        Since the Corps of Engineers typically expend up to $1,000,000 over
    a two year period for a feasibility study, the fiscal year 2000 federal
    appropriation for the Poso Creek Stream Group needs to be $500,000 for
    an orderly continuation of flood control investigations by the Corps.
        The local sponsors urge the subcommittee's appropriation of
    $500,000 in fiscal year 2000 for Poso Creek Stream Group feasibility
    studies by the Corps.
                                     ______

    Prepared Statement of Ed Henderson, Chairman, Napa County Flood Control
                        and Water Conservation District
                        napa river flood control project
    Background
        The Napa River is the main waterway into which all tributaries on
    the Napa Valley flow. The river reaches its highest flow and the main
    point of concentration of storm water in the heart of the downtown city
    of Napa. The original town of Napa was established at the head of the
    navigable Napa River channel in 1848 as its only port for
    transportation and commerce until the railroad extended from Benicia to
    Napa in 1902.
        The project is located in the city and county of Napa, California.
    The population in the city of Napa, approximately 67,000 in 1994, is
    expected to exceed 77,000 by the year 2000. Excluding public
    facilities, the present value of damageable property within the project
    flood plain is well over $500,000,000. The Napa River Basin, comprising
    426 square miles, ranging from tidal marshes to mountainous terrain, is
    subject to severe winter storms and frequent flooding. In the lower
    reaches of the river, flood conditions are aggravated by high tides and
    local runoff. Floods in the Napa area have occurred in 1955, 1958,
    1963, 1965, 1986 (flood of record), 1995 and 1997. Last February, the
    river rose just above flood stage on three occasions, but subsided
    before major property damage occurred.
        Over the years, the community has expressed a strong desire for
    increased flood management. Since 1962, twenty-seven major floods have
    struck the Valley region, exacting a heavy toll in loss of life and
    property. The flood of 1986, for example, killed three people and
    caused more than $100,000,000 in damage. The town of Napa is
    particularly vulnerable to floods: during a typical 100-year flood,
    more than 325,000 gallons of water flow through the downtown river area
    per second, with the potential of inundating 2,000,000 square feet of
    businesses and offices and nearly 3,000 homes.
        Flood damage in downtown Napa has recurred in January 1993, January
    and March 1995, January 1997 and February 1998, resulting in disaster
    declarations and Damage Survey Reports filed with FEMA, reaffirming the
    urgent need to implement the cost-effective project. In March 1995 and
    January of 1997, additional flood disasters occurred and FEMA is
    reviewing the damage claims.
        Damages throughout Napa County totaled about $85,000,000 from the
    January and March 1995 floods. The floods resulted in 27 business and
    843 residences damaged countywide. Almost all of the damages from the
    1986, 1995 and 1997 floods within the project area would have been
    prevented by the project; this was just the latest in a long history of
    flooding disasters. During the past 36 years of flooding, Napa County
    residents have suffered devastating loss of lives and livelihoods, and
    over $542,000,000 in property damage alone. According to the most up-
    to-date models, uncontrolled flooding over the next 100 years will
    likely cause $1,600,000,000 worth of property damage.
        Locally developed flood measures currently in place provide minimal
    protection and include levees, floodwalls, pump stations, upstream
    reservoirs, restrictive flood plain management ordinances, and
    designated flood evacuation zones. Vast areas of flood plain are
    restricted to agricultural and open space uses, precluding development
    that would be damaged by flooding. These local measures still leave
    most of the city of Napa vulnerable to frequent damaging floods.
    Congress has authorized flood control projects since 1944, but due to
    their expense, lack of public consensus on the design and concern about
    environmental impacts, a project has never been realized. The most
    recent Corps of Engineers project plan consisted of a deepening and
    channelization project. In mid-1995, federal and state resource
    agencies reviewed the plan and gave notice to the Corps that this plan
    had significant regulatory hurdles to face.
                         revised plan--project overview
        In an effort to identify a meaningful and successful plan, a new
    approach emerged that looked at flood control from a broader, more
    comprehensive perspective. Citizens for Napa River Flood Management was
    formed, bringing together a diverse group of local engineers,
    architects, aquatic ecologists, business and agricultural leaders,
    environmentalists, government officials, homeowners and renters and
    numerous community organizations.
        Through a series of public meetings and intensive debate over every
    aspect of Napa's flooding problems, the Citizens for Napa River Flood
    Management crafted a flood management plan offering a range of benefits
    for the entire Napa region. The Corps of Engineers served as a partner
    and a resource for the group, helping to evaluate their approach to
    flood management. The final plan produced by the Citizens for Napa
    River Flood Management was successfully evaluated through the research,
    experience and state-of-the-art simulation tools developed by the Corps
    and numerous international experts in the field of hydrology and other
    related disciplines. The success of this collaboration serves as a
    model for the nation.
        Acknowledging the river's natural state, the project utilizes a set
    of living river strategies that minimize the disruption and alteration
    of the river habitat, and maximizes the opportunities for environmental
    restoration and enhancement throughout the watershed. This strategy
    replaces the former project and now entails flood plain acquisition and
    restoration, restoration of a geomorphically stable river channel,
    replacement of bridges and environmentally sensitive stream bank
    treatment in the urban reaches of the city of Napa.
        The revised plan, which provides 100-year protection, has been
    developed by the Corps with the assistance of the community and its
    consultants into the Supplemental General Design Memorandum (SGDM) and
    its accompanying draft Environmental Impact Statement/Environmental
    Impact Report (SEIS/EIR). These reports were released for public
    comment in December of 1997 and are now under final review by Corps
    Headquarters. Land acquisition is planned to begin this spring with a
    goal of a new construction start in the summer of 2000.
        The coalition plan now memorialized in the Corps draft SGDM
    includes the following engineered components: lowering of old dikes,
    marsh plain and flood plain terraces, oxbow dry bypass, Napa Creek
    flood plain terrace, upstream and downstream dry culverts along Napa
    Creek, new dikes, levees and flood walls, bank stabilization, pump
    stations and detention facilities, and bridge replacements. The
    benefits the plan will provide include reducing or elimination of loss
    of life, property damage, cleanup costs, community disruption due to
    unemployment and lost business revenue, and the need for flood
    insurance. The plan will protect access to businesses, public services,
    and create opportunities for recreation and downtown development,
    boosting year-round tourism. As a key feature, the plan will improve
    water quality, create urban wetlands and enhance wildlife habitats.
        The plan would protect over 7,000 people and over 3,000
    residential/commercial units from the 100-year flood event on the Napa
    River and its main tributary, the Napa Creek, and the project has a
    positive benefit-to-cost ration under the Corps calculation. One
    billion in damages will be saved over the useful life of the project.
    The Napa County Flood Control District is prepared to meet its local
    cost-sharing responsibilities for the project. A countywide sales tax,
    along with a number of other funding options, was approved last year by
    a two-thirds majority of the county's voters for the local share. Napa
    is California's third highest repetitive loss community. This plan is
    demonstrative of the disaster resistant community initiative, as well
    as the sustainable development initiatives of FEMA and EPA.
                                project synopsis
    Fiscal Year 1999 Funding
        The 1999 budget included $744,000 to prepare plans and
    specifications and finalize the Project Cooperation Agreement for the
    project.
    Necessary fiscal year 2000 Funding
        Funding for the Napa River Project during 2000 in the amount of
    $6,500,000 is needed to initiate construction of the project.
    Recommendation
        Based on continuing high flood risk and severe damage from the Napa
    River, we request that the Committee support $6,5000,000 to initiate
    construction of the Napa River Flood Control Project.
                                project elements
    March 1999
        The current plan, which is the result of the Coalition effort in
    concert with the Corps of Engineers, includes land acquisition for
    river widening, levee and flood wall construction, recreational
    facilities, open space and an oxbow dry bypass, among other items. The
    Corps has incorporated the refined design into its key preconstruction
    documents. Design documents are under final review and the construction
    drawings are being prepared. The County is negotiating the Project
    Cooperation Agreement (PCA) with the Corps and is planning to begin
    acquiring lands this spring. The County is working to ensure that
    construction of the project will start in fiscal year 2000.
                               project components
        The following redesigned project components were developed by the
    Community Coalition, incorporated by the Corps and listed here with a
    brief description. These components are included in the Corps' final
    design plan.
    Marsh Plain and Flood Plain Terraces
        Providing room for rising floodwaters, terraces are natural
    attributes of all river systems. Two types of terraces are included in
    the project, beginning near Kennedy Park and extending to the southern
    end of the oxbow. Marsh plain terraces are submerged during the twice-
    daily high tide cycles, creating a diverse wetland habitat. Elevated
    slightly from the marsh plain terraces, flood plain terraces are
    inundated by floods every several years, providing room for large
    floods.
    New and Restored Wetlands
        Through concerted planting efforts and the removal and lowering of
    levees, the project will create over 650 acres of new wetland habitat,
    including emergent marsh, riparian and seasonal wetlands.
    Bank Stabilization and Protection
        Bank stabilization techniques combined with native vegetative cover
    in both marsh and flood plains; maintenance of existing trees; planting
    of new trees; the addition of rock bank toe protection and a grade
    control structure are all included in this component.
    Napa Creek Conveyance
        Napa Creek conveyance will be increased by the construction of a
    flood terrace on the north bank of the creek, removal of a number of
    bridges and the construction of culvert dry bypasses.
    Napa River Dry Bypass
        A dedicated dry bypass allows the safe flow of excess water and
    serves as recreational and open space during normal flows, when the
    river returns to the meandering oxbow.
    Napa Creek Bypass Culverts
        Two concrete dry bypass culverts will be constructed, each designed
    to convey 100-year flood flows.
    Roadway Bridge Reconstruction
        Overall, a total of seven bridges will be removed and replaced to
    allow the safe passage of water and debris during a 100-year flood.
    Pump Stations and Detention Facilities
        During large events, the new floodwalls and levees will trap local
    storm water. The project includes the construction of three pump
    stations to safely return this water through the floodwall into the
    Napa River.
    Floodwalls
        Located at the tops of the riverbanks, floodwalls offer substantial
    protection from large floods.
                        napa valley watershed management
    Background
        The Napa Valley watershed faces many challenges and stresses to its
    environmental health and flood management abilities. From a healthy
    river point of view, the Napa River has been on a recovery path since
    its low point in the 1960's, when the last of the native salmon were
    taken from the system by severe water pollution and habitat
    destruction. Steelhead trout have survived as a remnant population of
    two hundred that is presently in need of higher quality and more
    extensive spawning areas for recovery to a significant population.
    Beginning populations of fall run Chinook salmon have taken up
    residence in the watershed in those few areas available for spawning.
    While the chemical and wastewater pollution of earlier years has been
    effectively dealt with, excess sediment is still a critical stress on
    the salmon population, as it is to the spawning and rearing areas of
    the river in the estuarine zone upstream of San Pablo Bay, populated by
    delta smelt, splittail, green sturgeon and striped bass.
        The River has been prioritized as an impaired water body by the
    U.S. EPA and Region II Water Quality Control Board because of the
    sediment production. The excess sediment generated in the watershed
    suffocates spawning areas, reduces the stream's flood-carrying ability,
    fills deep pools, increases turbidity in the stream and estuary,
    carries with it nutrients that bring significant algae blooms during
    the summer and fall, and changes the morphological balance of the
    streams and river toward more unstable conditions.
        Over time, both private and public diversions and levees have been
    constructed in a chaotic way. The accumulated encroachment has
    constrained the river and its riparian corridor to approximately one
    third of its optimum morphological width for much of its length. The
    Napa Valley has also been extensively drained in the last century,
    eliminating nearly all of the sloughs and extensive wetlands that once
    covered the valley floor. Combined with increasing agricultural and
    urban development, the narrowed channel and loss of wetlands has
    greatly changed the river and its major tributaries, limiting its flood
    management capabilities. The river now regularly scours extensively on
    both bed and banks, generating large amounts of sediment that settle in
    the lower river and estuary, only to be stirred and moved by the tides
    during the dry season. Loss of tidal wetlands in the lower river due to
    70 years of dike construction has resulted in a much smaller area to
    disperse sediment, exacerbating losses in all types of riverine and
    estuarine-related complex habitats in the system.
        In an effort to address these conditions and to develop local tools
    for improving natural resource management, Napa County Resource
    Conservation District is proceeding with a local effort entitled the
    Napa River Watershed Stewardship program. This project, which has
    recently received funding through the CALFED Category III Program, is
    intended to address a broad range of ecological and biological values
    in the Napa River watershed, including steelhead and salmon
    populations, and improved wetlands and flood plain functions.
        One of the key elements of the program, from the Napa County Flood
    Control District's perspective, is the watershed monitoring and
    computer modeling of watershed functions. Their goal is to use these
    modeling and monitoring efforts to form strategies in developing flood
    management and restoration approaches for the upper Napa Valley
    watershed. The overall project is intended to extend the implementation
    of the recommendations included in the Napa River Watershed Owner's
    Manual, a framework for watershed management for the Napa River basin.
    It will address the issues of habitat and fishery degradation, and will
    enhance and expand riparian, riverine, estuarine, and freshwater
    aquatic habitats for species. It will provide services to the project
    collaborators in the form of training, education, computer-assisted
    design and modeling of enhancement projects, and financial assistance
    for implementation. It will also provide training in specific project
    monitoring, as well as general watershed monitoring, to be included in
    the database and GIS at the Resource Conservation District. Services
    will be delivered through work with existing and new local tributary
    stewardship groups throughout the Napa Valley.
        The approach to implementation is the Stewardship Watershed
    Management, which relies on a large degree of participation by
    landowners and residents of tributary and mainstream regions. The
    stewardship process has been very successful in developing and
    supporting local responsibility for natural resources management, with
    a heavy emphasis on monitoring and adaptive management of the resources
    based on monitoring feedback. Planning is done using interest-based
    consensus, with implementation from a wide variety of partners that may
    vary from one specific project to another. Watershed education exchange
    typically takes place through existing groups. Project implementation
    is commonly done by the landowner, whether public or private with
    support from the District, rather than by the district on behalf of the
    landowner.
                                    request
        In an effort to develop a complementary approach to this total
    effort, the Napa County Flood Control District is seeking that the Napa
    Valley Watershed Management Study be continued by the Corps of
    Engineers. The authority for this study is the Northern California
    Streams Study Authority stemming from the Rivers and Harbors Act of
    1962, Public Law 87-874. Specifically, the Napa County Flood Control
    District is beginning to work closely with the Corps in examining the
    watershed management needs, including flood control, environmental
    restoration, storm water retention, storm water runoff management,
    water conservation and supply and wetlands restoration in the Napa
    Valley, including the communities of Yountville, St. Helena and
    Calistoga in Napa County. To ensure maximum utility, the District has
    requested the Corps to work closely in this effort with the Napa County
    Flood Control District, the Natural Resources Conservation Service, the
    Napa County Resource Conservation District, the Napa County Farm
    Bureau, the California Department of Fish and Game, the local
    communities, and the Napa River Watershed Task Force, which was
    recently appointed by the Napa County Board of Supervisors to develop a
    collaborative process to assess the watershed management needs of the
    Napa Valley. In particular, the County is requesting the Corps to
    examine the following issues: Up-Valley communities flood protection
    strategies;Hillside erosion mitigation strategies in conjunction with
    the agricultural industry and Groundwater preservation and water supply
    issues
        The study must be conducted in close coordination with the Napa
    County Resource Conservation District's on-going Napa River Watershed
    Stewardship Program.
                                project synopsis
    Fiscal Year 1999 Funding
        Congress appropriated $100,000 to initiate the Napa Valley
    Watershed Management Study.
    Necessary Fiscal Year 2000 Funding
        Funding for the Napa Valley Watershed Management Study during
    fiscal year 2000 in the amount of $100,000 is needed to have the Corps
    of Engineers continue the study to examine watershed management needs.
                                     ______

             Prepared Statement of the City of Stockton, California
        The City of Stockton supports the following Corps of Engineers and
    Bureau of Reclamation water, flood control and fishery projects:

    Stockton Metropolitan Area....................................  $200,000
    Farmington Dam................................................   150,000
    San Joaquin Watershed......................................... 2,000,000
    Cosumnes and Mokelumne River..................................    50,000
    Water Resources Development Act, 1996, Section 206, Aquatic
        Ecosystem Restoration, Stockton Waterfront................   ( \1\ )
    Port of Stockton and San Joaquin River Channel................   150,000
    South Delta Barriers..........................................    20,000

    \1\ No additional funds requested.
    ---------------------------------------------------------------------------
                            u.s. corps of engineers
    Stockton Metropolitan Area--$200,000
        This project was analyzed by the United States Army Corps of
    Engineers' (Corps) 1997 Reconnaissance Report, which concluded that
    there was a Federal interest in a flood project for the Stockton area.
    During this same period, a levee project was authorized under Section
    211 of the Water Resources Development Act of 1996 for the San Joaquin
    Area Flood Control Agency (SJAFCA) levee project. Before Federal
    dollars can be appropriated to reimburse SJAFCA (up to 75 percent
    reimbursement), a Section 211 Report must be approved by the Secretary
    of the Army. The requirements of this Report, since the project is
    essentially complete, and the funding of the report (potentially 100
    percent local with reimbursement upon completion), are currently under
    negotiation. The President's budget of $200,000 is adequate to complete
    the required study if it is determined that the study can be cost-
    shared. The local view is that the Reconnaissance Report by the Corps
    found the project to be highly beneficial and that additional
    expenditures on studies of nearly constructed projects are unwarranted.
    The United States Army Corps of Engineers proposes $1,000,000 of
    additional studies to secure approval of the existing project and to
    analyze the rural areas for a feasible project. The funding in the
    President's budget is adequate to allow completion of the studies
    required. The San Joaquin Area Flood Control Agency will provide local
    funding for this study. The Corp's draft feasibility report is due in
    August 1999, and the final feasibility report is due in March 2000.
    Farmington Dam--$150,000
        The study costs for this investigation will determine if a Federal
    interest may exist for converting Farmington Dam into a multiple
    purpose reservoir inclusive of flood control, water supply, groundwater
    recharge, and environmental enhancement. The President has included
    $150,000 in his fiscal year 2000 budget. The current fiscal year 1999
    budget includes $500,000. Since this is a feasibility study, all
    Federal funds must be matched by local funds. The sponsor for this
    study is the Stockton East Water District.
    San Joaquin River Watershed--$2,000,000
        The San Joaquin River Comprehensive Study is an ongoing $9,000,000
    study of the water resource's needs of the San Joaquin and Sacramento
    Rivers. Flood control and environmental needs will receive equal
    consideration. We expect setback levees and reoperation of existing
    reservoirs will receive a careful review in this study. A status report
    to Congress is expected to be released this April, which will outline
    $16,000,000 to $20,000,000 of studies to be performed in future years.
    The President approved $3,500,000 million for fiscal year 1999 and
    $2,000,000 for both the San Joaquin and Sacramento River Basin studies.
    At this time, we do not know the exact allocation between each of the
    basin, although 50-50 seems likely. The State is the cost sharing
    partner in these studies.
    Cosumnes and Mokelumne Rivers--$50,000
        A reconnaissance study of ecological restoration and non-structural
    flood control improvements is being performed on the Mokelumne and
    Cosumnes Rivers. The current fiscal year 1999 funding is $18,000, and
    the President's fiscal year 2000 budget is $50,000. Separate studies
    and report are being prepared by April 1999 for the Cosumnes River
    (between the Delta and Michigan Bar) and the Mokelumne River (between
    the Delta and Camanche Reservoir).
    Water Resources Development Act, 1996, Section 206, Aquatic Ecosystem
            Restoration--Stockton Waterfront--No additional funds
        The City of Stockton, CalTrans and the Port of Stockton have
    combined to initiate a study to restore the aquatic ecosystem of the
    Stockton Waterfront. The assistance of the Corps of Engineers to study,
    plan and eventually construct improvements will expedite this
    restoration project. An essential element of the study will be the
    development of a model of the channel to determine the appropriate
    level of oxygen required to restore aquatic life and improve water
    quality conditions in the channel. The channel is currently a dead-end
    slough, contaminated by urban storm runoff and boating discharges.
    Potential solutions include the installation of pumps to create flow
    and/or aeration devices to oxygenate the water. This project will not
    only improve water quality but significantly complement economic
    development in downtown Stockton. Additionally, restoring this segment
    of the lower San Joaquin River is consistent with the objectives of
    American Heritage Rivers program, a designation recently given by the
    President to the lower San Joaquin River.
                             bureau of reclamation
    South Delta Barriers--$20,000
        The project provides temporary barriers in the south Delta to
    improve water quality. The fiscal year 1999 budget includes funding for
    $16,000 and the President's fiscal year 2000 budget includes funding
    for $20,000.
        The City of Stockton conditionally supports the following project:
                             bureau of reclamation
    Bay-Delta Ecosystem Restoration--$95,000,000
        Current year funding is for $143,000,000 and the President's fiscal
    year 2000 budget has included $95,000,000. Funds for this program have
    been used primarily for acquisition of lands and development of the
    habitat. We are concerned with the loss of agricultural lands and the
    lack of accountability with the funds. No documentation of benefits
    will be derived from expenditure of funds. This program does not help
    with water supply. There are no water quality improvement objectives
    and the program does not recognize area of origin protections.
                  Resolution No. 99-0108 Stockton City Council
        WHEREAS, during the week of March 22, 1999, appropriate committees
    of the Congress of the United States will conduct hearings to consider
    federal appropriations for water, flood control, and fishery projects
    for fiscal year 2000; and
        WHEREAS, several projects to be considered at said Congressional
    hearings will directly impact the City of Stockton and its environs;
    and
        WHEREAS, the expeditious construction of said projects is required
    to protect the health, welfare and safety of the residents of this
    area; now, therefore,
        BE IT RESOLVED BY THE COUNCIL OF THE CITY OF STOCKTON AS FOLLOWS:
        1. That the City of Stockton does hereby support the appropriation
    by the Congress of the United States of funds for fiscal year 2000 for
    the planning, continuation and completion of flood control and
    reclamation projects, namely: a. Stockton Metropolitan Area, $200,000;
    b. Farmington Dam, $150,000; c. San Joaquin River Watershed,
    $2,000,000; d. Consumnes and Mokelumne Rivers, $50,000; e. Water
    Resources Development Act, 1996, Section 206, Aquatic Ecosystem
    Restoration-Stockton Waterfront, No additional funds requested; f. Port
    of Stockton and San Joaquin River Channel, $150,000; and g. South Delta
    Barriers, $20,000.
        2. That the City of Stockton does hereby support the appropriation
    by the Congress of the United States of funds for fiscal year 2000,
    with conditions, namely: a. Bay-Delta Ecosystem Restoration,
    $95,000,000.
        (1) The City of Stockton is concerned that the CALFED Program
    continues to overlook the need of surface and groundwater supply
    requirements within the County of San Joaquin.
        (2) The City of Stockton is concerned that the CALFED Program does
    not recognize County area of origin protections and there are no water
    quality improvement objectives to improve the water quality of San
    Joaquin County water supplies.
        (3) The City of Stockton is concerned that the CALFED Program does
    not provide documentation of the benefits that will be derived from the
    expenditure of funds, particularly to displace agricultural lands.
        3. That the Statement by the City of Stockton, California, before
    the Committee on Appropriations, Subcommittee on Energy and Water
    Development of the Senate and House of Representatives, is hereby
    approved as the official Statement of the City Council. A copy of said
    document is attached as Exhibit ``A'' and incorporated by this
    reference.
        4. That the Mayor is hereby directed to forward a copy of said
    Statement to the appropriate Congressional Committees and to the City
    of Stockton's representatives in the Senate and House of
    Representatives, and the City Manager will monitor and initiate proper
    follow-up communication and correspondence to reflect the City
    Council's position.
                PASSED, APPROVED and ADOPTED March 2, 1999.

                                       GARY A. PODESTO,
                                 Mayor of the City of Stockton.
    ATTEST:
         KATHERINE GONG MEISSNER, City Clerk of the City of Stockton
                                     ______

      Prepared Statement of Jim Venable, Chairman, Board of Supervisors,
         Riverside County Flood Control and Water Conservation District
    Resolution No. 99-5 Supporting Federal Appropriations for Flood Control
                         Projects for Fiscal Year 2000
        WHEREAS, the United States House of Representatives Committee on
    Appropriations, Sub-Committee on Energy and Water Development, and the
    United States Senate Committee on Appropriations, Sub-Committee on
    Energy and Water Development are holding hearings to consider
    appropriations for Flood Control and Reclamation Projects for fiscal
    year 2000 and have requested written testimony to be submitted to the
    committees prior to March 31, 1999; and
        WHEREAS, the Riverside County Flood Control and Water Conservation
    District supports the completion of construction for the project to
    reduce flooding and bank destruction along the Santa Ana River at Norco
    Bluffs, California; the completion of a feasibility study and
    initiation of design efforts for a flood control project on Murrieta
    Creek, a sub basin of the Santa Margarita River watershed in Riverside
    and San Diego Counties, California; the initiation of a flood control
    reconnaissance study for the San Jacinto River; the continuation of
    construction of the Santa Ana River Mainstem project; and the
    initiation of construction at Prado Dam; now, therefore,
        BE IT RESOLVED by the Board of Supervisors of the Riverside County
    Flood Control and Water Conservation District in regular session
    assembled on February 16, 1999, that they support appropriations by
    Congress for fiscal year 2000 for the following projects:

    U.S. Army Corps of Engineers

    Santa Ana River at Norco Bluffs: Construction--General..      $2,200,000
    Murrieta Creek:
        Feasibility Study--Flood Control....................         232,000
        Preconstruction Engineering & Design................         100,000
    San Jacinto River: Reconnaissance Study--Flood Control &
        Other Purposes......................................         100,000
    Santa Ana River Mainstem: Construction--General.........      23,000,000
    Prado Dam: Construction--General........................       5,000,000

        BE IT FURTHER RESOLVED that the General Manager-Chief Engineer is
    directed to distribute certified copies of this resolution to the
    Secretary of the Army, Members of the House of Representatives
    Committee on Appropriations and Sub-Committee on Energy and Water
    Development, the Senate Committee on Appropriations and Sub-Committee
    on Energy and Water Development, and the District's Congressional
    Delegation--Senators Dianne Feinstein and Barbara Boxer, Congressmen
    Ron Packard and Ken Calvert, and Congresswoman Mary Bono.
    Santa Ana River at Norco Bluffs
        The Santa Ana River passes along the northerly border of the City
    of Norco. The southerly bank of the river is a bluff varying in height
    from 46 to 96 feet above the streambed, atop which is a residential
    neighborhood. The floods of January and February 1969 caused flow
    impingement on the riverbank, which undermined the toe of the slope,
    causing severe bank sloughing. Although 50 to 60 feet of the bluff
    retreated to the south, and no improvements were lost, the threat to
    improvements from future river actions became apparent. The floods of
    1978 and 1980 impinged further, causing another 30 to 40 feet of bluff
    retreat, and the loss of a single family residence.
        Section 101(b)(4) of the Water Resources Development Act of 1996
    provided for the authorization of the project, dependent upon the
    project receiving a favorable Chief's Report. On December 23, 1996, the
    Corps' Chief of Engineers issued a Chief's Report recommending the
    Norco Bluffs project for construction.
        Design of the project by the Corps is nearly complete, and is fully
    funded. Certain geotechnical design considerations have resulted in an
    increased cost for the project. We, therefore, are now seeking the
    Committee's approval of supplemental funding in the amount of
    $2,200,000 in fiscal year 2000 for completion of construction of the
    Santa Ana River at Norco Bluffs Bank Stabilization Project. The
    Riverside County Flood Control and Water Conservation District is fully
    prepared to meet its cost-sharing obligation.
    Santa MargaritA Watershed--Murrieta Creek Feasibility Study
        The Santa Margarita Watershed lies in the south and northwesterly
    areas of Riverside and San Diego Counties, respectively. Murrieta Creek
    passes through the cities of Murrieta and Temecula in Riverside County,
    then confluences with Temecula Creek to form the Santa Margarita River
    which flows into San Diego County, through the Camp Pendleton Marine
    Base, and into the Pacific Ocean.
        Murrieta and Temecula experienced severe flood damage in January
    1993, estimated in excess of $10,000,000, from Murrieta Creek overflow.
    Camp Pendleton also suffered extensive flood damage, estimated at
    $88,000,000, to facilities and aircraft due to overflow of the Santa
    Margarita River. For the past several years, a coalition of local
    citizens, community leaders, environmentalists, and developers have
    worked closely with the District to identify solutions to the flooding
    problems within the Murrieta Valley.
        A U. S. Army Corps of Engineers Feasibility Study addressing flood
    control, environmental enhancement, and recreation for Murrieta Creek
    was initiated in April 1998. We request that the Committee approve
    $232,000 in fiscal year 2000 appropriations to complete the Feasibility
    Study for a flood control project on Murrieta Creek within the Santa
    Margarita Watershed.
    Murrieta Creek--Preconstruction Engineering & Design
        The District anticipates the Corps completing the Murrieta Creek
    Feasibility Study in February 2000, and issuing a favorable Chief's
    Report in May 2000. The Corps will then be in a position to initiate
    the detailed engineering design necessary to develop construction plans
    and specifications for a Murrieta Creek Flood Control Project. The
    District respectfully requests that the Committee approve a fiscal year
    2000 appropriation of $100,000 for the Corps to initiate the
    Preconstruction Engineering and Design phase for a Murrieta Creek Flood
    Control Project.
    San Jacinto River
        The 730-square mile San Jacinto River watershed drains into Lake
    Elsinore in western Riverside County. The San Jacinto River originates
    in the San Jacinto Mountains and passes through the cities of San
    Jacinto, Perris, Canyon Lake and Lake Elsinore. The only major flood
    control structures on the river are levees in the City of San Jacinto
    built by the Corps of Engineers in the early 1960's. In the 30-mile
    reach of the river between Lake Elsinore and the City of San Jacinto,
    only minor channelization exists as the river is characterized by
    expansive overflow areas, including the Mystic Lake area. The San
    Jacinto River has caused major flooding damage to agricultural areas
    and rendered Interstate 215 and several local arterial transportation
    routes impassable. However, the river is an important resource that
    provides water supply, wildlife habitat, drainage and recreation values
    to the region.
        The District is requesting that the Corps of Engineers conduct a
    reconnaissance study of the San Jacinto River between the City of San
    Jacinto and the City of Lake Elsinore to investigate whether there is a
    Federal interest in flood control, environmental enhancement, water
    conservation and supply, recreation and related purposes.
        We wish to request that the Committee approve $100,000 in fiscal
    year 2000 appropriations to undertake a Reconnaissance Study on the San
    Jacinto River. In fiscal year 1999 the House Committee on
    Transportation and Infrastructure through Docket No. 2588, directed the
    Corps to undertake the study, however, the necessary funding was not
    provided as a part of that Resolution.
    Santa ANA River--Mainstem
        The Water Resources Development Act of 1986 (Public Law 99-662)
    authorized the Santa Ana River All River project which includes
    improvements and various mitigation features as set forth in the Chief
    of Engineers' Report to the Secretary of the Army. The Boards of
    Supervisors of Orange, Riverside, and San Bernardino Counties continue
    to support this critical project as stated in past resolutions to
    Congress.
        The Local Cooperation Agreement (LCA) was signed in December 1989
    by the three local sponsors and the Army. The first of five
    construction contracts started on the Seven Oaks Dam feature in the
    Spring of 1990. Significant construction has been completed on the
    lower Santa Ana River Channel and on the San Timoteo Creek Channel.
    Construction activities on Oak Street Drain and the Mill Creek Levee
    have been completed. The Seven Oaks Dam construction effort is over 90
    percent complete, and proceeding on schedule. We anticipate
    construction on Seven Oaks Dam to be completed in August of 1999. For
    fiscal year 2000, an appropriation of $3,000,000 is requested to
    address various endangered species issues, including that of the San
    Bernardino Kangaroo Rat, in the Santa Ana River wash in the vicinity of
    the damsite.
        An appropriation of $8,000,000 is being sought to complete
    construction of ``Reach 8'', the last remaining segment of the lower
    Santa Ana River Channel. An appropriation of $5,000,000 is requested to
    initiate construction of ``Reach 9'' (immediately downstream of Prado
    Dam), a section of streambed to receive some floodwall/slope revetment
    work to protect existing development along its southerly bank. The
    removal of accumulated sediment within an already completed section of
    the Santa Ana River Channel near its outlet to the Pacific Ocean, along
    with much delayed landscaping work, will necessitate a fiscal year 2000
    appropriation of $7,000,000 which includes engineering and project
    management support.
        The Prado Dam feature of the Santa Ana River Mainstem project
    continues to move closer to an eventual construction start. Engineering
    design for the dam embankment and outlet works is approximately 90
    percent complete. Design work has been initiated on the various
    interior dikes included in the project, and additional design contracts
    are ready to be let for the balance of engineering work necessary prior
    to construction. A fiscal year 2000 appropriation of $5,000,000 would
    allow the Corps to complete its design efforts on the Prado Dam
    project, including construction plans and specifications in advance of
    awarding construction contracts.
        We, therefore, respectfully request that the Committee support an
    overall $28,000,000 appropriation of Federal funding for fiscal year
    2000 for the Santa Ana River Mainstem project.
                                     ______

      Prepared Statement of Carl L. Blum, Deputy Director, Department of
                  Public Works, Los Angeles County, California
    Background
        Floods are a part of the history of the Los Angeles area.
    Widespread floods have periodically devastated vast areas of the region
    and were responsible for taking lives, damaging property and
    interrupting commerce and trade.
        The U.S. Army Corps of Engineers and County of Los Angeles, acting
    on behalf of the Los Angeles County Flood Control District, have built
    one of the most extensive flood control systems in the world.
    Construction of the major elements of the system began in the 1920s and
    consisted of 20 major dams, 470 miles of open channels, and many other
    appurtenant facilities. Fifteen of these major dams are owned and/or
    operated by the County while the remaining five dams (Hansen, Lopez,
    Santa Fe, Sepulveda and Whittier-Narrows), are owned and operated by
    the Corps. Since the major segments were completed, it is estimated
    that the system has prevented $3,600,000,000 in potential flood damage.
        Development which occurred after World War II exceeded the
    projections the Corps used in the 1930s and has increased runoff to the
    point where, even in a moderate storm, the runoff could exceed the
    design capacity of portions of the system. For example, the lower Los
    Angeles River in the City of Long Beach came close to overtopping in
    1980 from a 25-year flood. A storm of greater magnitude would have a
    tremendous impact, both personal and economic, on Los Angeles County,
    the nation's second largest metropolitan area.
        At the request of the County of Los Angeles, the Corps analyzed the
    adequacy of the existing major flood control facilities serving the Los
    Angeles basin in the LACDA Review study. In 1990, a project to upsize a
    portion of the LACDA system received Congressional approval subject to
    a favorable report by the Chief of Engineers (received in 1995), and
    signature of the Record of Decision by the Secretary of the Army, which
    was obtained in July 1995.
        The final report by the Corps identified 100-year flood damages
    totaling $2,250,000,000 covering an 82-square-mile area which houses
    over 500,000 people. These damages would occur in the heavily-urbanized
    Los Angeles basin, where adequate protection from a 100-year flood was
    previously provided.
        The LACDA project is a critical modification to existing
    facilities. Obtaining funds to do the modification is critical for two
    reasons: The threat of flooding to over one-half million people and the
    large economic impact FEMA's final Flood Insurance Rate Maps (FIRMs)
    have on the overflow area that became effective July 6, 1998.
        Until the project is completed, any delay in construction will
    cause great financial hardship on thousands of people, who thought the
    existing river provided adequate protection and now need to buy flood
    insurance (an impact as high as $65,000,000 annually).
        This project, currently estimated to cost approximately
    $240,000,000, is scheduled to be completed within the next three years,
    pending adequate funding. The following table shows the history of
    federal funding for the project:

    ------------------------------------------------------------------------
                                                            Expenditure of
           Federal fiscal year          Federal funding    federal funding
    ------------------------------------------------------------------------
    1994-95..........................          $500,000  Initiation of first
                                                          construction
                                                          contract awarded
                                                          in September 1995
    1995-96..........................        11,300,000  Continuation of
                                                          first contract
    1996-97..........................        14,400,000  Completion of first
                                                          contract and
                                                          initiation of two
                                                          contracts awarded
                                                          in August and
                                                          September of 1996
    1997-98..........................        20,700,000  Completion of
                                                          contracts awarded
                                                          in August and
                                                          September 1996,
                                                          and initiation of
                                                          one contract
                                                          awarded in
                                                          February 1998
    1998-99..........................        50,000,000  Completion of
                                                          contract awarded
                                                          in February 1998,
                                                          and initiation of
                                                          two new contracts
                                                          awarded in
                                                          September and
                                                          December 1998
    ------------------------------------------------------------------------

        Three additional construction contracts will be ready for
    advertising later this fiscal year and design of the entire project
    should be completed by the end of 1999.
        In order to complete the project within an appropriate schedule in
    light of the serious flood threat and the devastating financial impacts
    of the mandatory flood insurance premiums, it is critical to maintain
    the level of construction activity at $50,000,000 this upcoming fiscal
    year. As a result, we strongly support the California Water
    Commission's recommendation for $50,000,000 of Federal funds to
    continue construction of the LACDA Project.
                                     ______

         Prepared Statement of Dick Lyon, Mayor, City of Oceanside, CA
        The City of Oceanside is pleased to submit this request for
    appropriation for the City's Mission Basin Brackish Groundwater
    Desalting Research and Development Project. We would greatly appreciate
    your assistance in funding this important facility.
        The existing Mission Basin Groundwater Desalting Facility has been
    an unqualified success. Since its completion in 1994, the facility has
    produced 2,000,000 gallons per day of superior-quality water from
    previously unusable brackish groundwater. This represents seven percent
    of the City's daily water supply needs--enough water to serve 4,000
    Oceanside households. As our only water source that does not cross
    major earthquake fault lines, it is also a critically-needed emergency
    water supply.
        The Mission Basin Brackish Groundwater Desalting Research and
    Development Project will be a genuine win-win project. It will expand
    the capacity of the facility to 6,200,000 gallons per day, serving
    twenty-two percent of Oceanside residents. By reducing our dependence
    on imported water from the Colorado River and the Sacramento-San
    Joaquin River Delta, Oceanside will be part of the solution to
    California's water supply dilemma. Closer to home, the project will
    significantly increase the reliability of our water supply--an
    essential ingredient in the long-term health of our regional economy.
    When the facility expansion becomes a demonstrable success, the City
    will explore the use of reclaimed water injected into the groundwater
    basin to increase its capacity to 20,000,000 gallons per day.
        The cost of the expansion is estimated at $11,600,000. The
    authorization for this project recommends funding for twenty-five
    percent of 3,000,000 gallons per day of the 4,300,000 gallon per day
    expansion. It is estimated that the 3,000,000 gallon per day expansion
    will cost $8,100,000. Therefore an appropriation of $2,030,000 for the
    3,000,000 gallons per day authorization from the Bureau of Reclamation
    will enable the City to complete the project while reducing the
    financial impact on rate payers, and will advance the City towards our
    ultimate goal of producing 20,000,000 gallons per day. The funding will
    create a ripple effect in Southern California and beyond by
    demonstrating the efficient use of groundwater desalting technology,
    stimulating other agencies to develop their own projects. Ultimately,
    appropriating funds to the City of Oceanside will provide some much-
    needed relief to the water supply crisis affecting the entire
    Southwestern United States. Construction is due to begin in mid-1999,
    and to be complete in 2001.
        The City of Oceanside respectfully requests that you appropriate
    $2,030,000 in the fiscal year 2000 Energy and Water Development
    Appropriation bill for this project.
        The City of Oceanside is requesting appropriations of $2,030,000 in
    the fiscal year 2000 budget for the Mission Basin Brackish Groundwater
    Desalting Research and Development Project.
                           appropriation request 1999
        The City of Oceanside is requesting appropriations of $2,030,000 in
    the Fiscal Year 2000 budget for the Mission Basin Brackish Groundwater
    Desalting Research and Development Project.
        Construction cost estimate is $11,600,000.
        Benefits to the City of Oceanside and the Southern California
    Region include the following:
      --Provides an emergency water supply for the City and the Camp
            Pendleton Marine Corps Base.
      --Creates a highly reliable water supply, which is critical to the
            region's long-term economic health and its ability to attract
            and retain businesses.
      --Provides benefits to California and the rest of the nation by
            reducing the region's demand for imported water from the
            Colorado River and the environmentally sensitive Sacramento-San
            Joaquin River Delta.
        The existing Mission Basin Brackish Groundwater Desalting Facility.
    Background
        The City of Oceanside owns and operates a 2,000,000-gallon-per-day
    facility that recovers and desalts brackish Groundwater from the San
    Luis Rey Mission Groundwater Basin. Oceanside proposes to expand this
    facility to 6,300,000 gallons per day.
        Water from the Mission Basin was previously considered unusable as
    a municipal water source due to its high salinity and mineral content.
        The current desalting facility produces 2,200 acre-feet of potable
    water annually--enough water to meet the annual needs of 4,000
    households.
        Oceanside's local water supply development has received support
    from many agencies including the State of California, which loaned the
    City $5,000,000 to build the initial small-scale demonstration project.
         proposed brackish groundwater desalting & development project
        The project will increase production capacity of the existing
    desalting facility to 6,300,000 gallons per day, or 6,400 acre-feet per
    year. This new water supply will be sufficient to meet 22 percent of
    the City's average annual water supply needs.
        The project will benefit Oceanside and the larger San Diego region
    by creating a local, highly reliable water supply. Unlike imported
    water, this local water supply does not cross major earthquake fault
    lines to reach consumers. A reliable water supply is critical to the
    region's long-term economic health, and its ability to attract and
    retain businesses.
        The project will also serve as a model for other groundwater
    desalting projects in San Diego County and elsewhere in Southern
    California. The proposed expansion involves the use of Energy Saving
    Polyamide (ESPA) reverse osmosis membrane elements. The membranes offer
    significant savings in both investment and operation expenses that
    exceed other membrane elements currently on the market.
        The Mission Basin Brackish Groundwater Desalting Research and
    Development Project will use reverse osmosis technology to produce
    potable water of higher quality than the City's imported water supply.
        The reverse osmosis process involves pumping water at high pressure
    through semi-permeable membranes. Membrane pores are large enough to
    let water molecules through, but small enough to remove salts, metals,
    and other dissolved impurities.
      --Groundwater pumped from the basin is treated first with chemicals
            to optimize membrane operations, then filtered.
      --The pretreated water then is pumped through the reverse osmosis
            membranes to remove all but the smallest molecular compounds.
            Dissolved minerals and other impurities removed by the reverse
            osmosis membranes are discharged to the City's ocean outfall
            for disposal.
      --The water receives additional chemical treatment to meet drinking
            water standards before it is added to the City's potable water
            system.
                                     ______

    Prepared Statement of Donald R. Kendall, Ph.D., P.E., General Manager,
                       Calleguas Municipal Water District
           calleguas municipal water district recycled water program
        Mr. Chairman and members of the Committee, thank you for the
    opportunity to submit this written testimony on the U.S. Bureau of
    Reclamation appropriations for fiscal year 2000. The Calleguas
    Municipal Water District is listed in the Bureau's budget as a ``new
    start'' for Title XVI water recycling funding ($1,500,000).
                              project description
    A. Main Features
        The Calleguas Municipal Water District proposes to implement a
    regional water reuse program. The principal objectives of the proposed
    program are: Increase the reliability of water service within the
    District's service area; Assist in achieving regional solutions to
    meeting wastewater discharge requirements; Provide necessary facilities
    to achieve long-term salt balance in the region; and Implement the
    Calleguas Creek Watershed Plan.
        The program is made up of several water recycling projects which
    include wastewater reclamation and groundwater recovery projects which
    will use reverse osmosis (RO) technology for demineralization. The
    treatment facilities will be connected by a Brine Disposal Pipeline
    designed to collect the concentrated effluent from the various
    demineralization facilities which are planned.
        The source of water for the water recycling projects are eight
    wastewater treatment plants located throughout the District's service
    area. The source water for the RO plants will be local brackish
    groundwater high in total dissolved solids (TDS). Most of the area is
    underlain by two aquifer systems and generally the upper aquifer system
    is high in TDS as a result of over extraction, the concentration
    effects of agricultural use, and discharges from the local publicly
    owned treatment works (POTW) that percolate to the upper aquifer
    system.
        The water which will be developed through this program will provide
    a wide range of beneficial potable and non-potable uses and will
    substantially reduce the region's demand for additional imported water
    supplies. The time frame for project implementation extends through the
    year 2020. The individual projects which make up the program include:
        Simi Valley Wastewater Reclamation Project.--The project will
    construct distribution and related facilities to enable the use of
    recycled water produced at the Simi Valley Water Quality Control Plant.
    Ultimate project yield is 5,000 AF.
        Conejo Creek Diversion Project.--This project will construct
    distribution and related facilities to enable the reuse of secondary
    treated wastewater from the City of Thousand Oaks Hill Canyon
    Wastewater Treatment Plant. The secondary effluent is currently
    discharged into Conejo Creek, a tributary of Calleguas Creek. The
    project will construct a diversion structure on Conejo Creek which will
    be used to diver the treated wastewater for deliveries to Pleasant
    Valley County Water District and Camrosa Water District. The two
    Districts will in turn deliver the reclaimed water to their customers
    for use in agricultural and landscape irrigation applications. The two
    Districts, which produce a good portion of their supply from the
    Pleasant Valley Groundwater Basin, will use the recycled water in-lieu
    of pumped groundwater. In exchange, the groundwater will remain in
    storage. The ultimate yield of the project is 14,000 AFY.
        Camarillo Wastewater Reclamation Project Expansion.--The project
    will expand the reuse of recycled water form the Camarillo Wastewater
    Treatment Plant. Recycled water will be used for agricultural and turf
    irrigation. The ultimate yield of the project is 2,840 AFY.
        Oak Park/North Ranch Wastewater Reclamation System Expansion.--The
    proposed project will expand an existing recycled water distribution
    system to enable the additional use of recycled water produced at the
    Tapia Water Reclamation Facility in Los Angels County. The proposed
    expansion will construct facilities to expan d service to an additional
    200 acres within the North Ranch area of Ventura County and will serve
    recycled water to a 27 hold golf course, two public parks, and about 35
    landscape irrigation customers. The additional amount of recycled water
    which will be used is 750 AFY.
        South Las Posas Brackish Groundwater Recovery Project.--This
    project will construct wells, treatment and distribution facilities to
    enable the recovery and use of groundwater from the south Las Posas
    Groundwater Basin. The project will entail the extraction of
    groundwater, desalination, and the conveyance of the product water to
    the Calleguas MWD potable water distribution system for further deliver
    to Calleguas' retail water customers. The ultimate project yield is
    5,300 AFY,
        West Simi Valley Brackish Groundwater Project.--The project will
    construct facilities to enable the recovery of groundwater from the
    western portion of the Simi valley Basin. The extracted and
    demineralized groundwater will be delivered to Calleguas' potable water
    distribution system for delivery to C alleguas' retail water customers.
    The project will convert five existing wells, drill and equip three new
    wells, construct well collection and transmission pipelines, a reverse
    osmosis treatment facility and related transmission distribution
    facilities. The ultimate project yield is 3,400 AFY.
        Thousand Oaks Brackish Groundwater Recovery Project.--The proposed
    project will construct distribution and related facilities to enable
    the recovery of groundwater from the Thousand Oaks Groundwater basin.
    This groundwater currently cannot be used either for potable or
    agricultural applications due to its poor water quality, mostly due to
    the high mineral content. The project will entail the extraction of
    groundwater, blending the groundwater with imported water which is of
    better quality, and the conveyance of the product water to Calleguas'
    distribution system for further deliver to their retail water
    customers. The ultimate project yield is 900 AFY.
        Regional Brine Line Disposal Facility.--The proposed project will
    construct facilities to dispose of brine which will be generated
    through the demineralization of recycled water and brackish
    groundwater. The proposed pipeline will be a regional facility which
    will collect the brine from six exi sting major wastewater treatment
    plants and two proposed groundwater desalination facilities within the
    Calleguas service area. The brine will be conveyed via the regional
    brine line for disposal to the Pacific Ocean via an ocean outfall.
    B. Operational Aspects
        The Calleguas Recycled Water Program is a series of projects
    involving wastewater treatment facilities, recycled and potable water
    distribution facilities, brackish groundwater treatment facilities and
    a regional brine line. All of these agencies are participating in this
    regional program: Ventura County Waterworks District No. 8 and No. 1,
    Southern California Water Company, City of Simi Valley, Metropolitan
    Water District of Southern California, Pleasant Valley County Water
    District, Camrosa Water District, City of Thousand Oaks, City of
    Camarillo, Camarillo Sanitary District, City of Oxnard, Oceanview
    Municipal Water District, United Water conservation District, City of
    Port Hueneme, Ventura County Public works Agency, Construction
    Battalion Center at Port Hueneme, California Water Service Company, Las
    Virgenes Municipal Water district, Triunfo County Sanitation District,
    City of Moorpark, and California American Water Company.
    C. Schedule
        The Recycled Water Program is comprised of several projects most of
    which will be implemented in phases. It is anticipated that all or most
    of the projects will be implemented by the year 2010. Three of the
    projects are in the advanced stages of implementation. For these
    project, feasibility studies and CEQA compliance documentation have
    been completed and can, therefore, be implemented in 2000.
    D. Project Costs
        The capital costs of the proposed program is estimated at
    $161,350,000 million. Table 1 delineates the program cost by project. A
    summary of the project cost is as follows:

    Simi Valley Wastewater Reclamation Project..............     $18,600,000
    Conejo Creek Diversion Project..........................      23,900,000
    Camarillo Wastewater Reclamation Project................       4,400,000
    Oxnard Wastewater Reclamation Project...................      97,700,000
    OakPark/North Ranch System Expansion....................       2,200,000
    Moorpark Wastewater Reclamation Project.................       2,400,000
    South Las Posas Groundwater Recovery Project............       9,100,000
    West Simi Valley Groundwater Recovery Project...........       6,900,000
    Thousand Oaks Groundwater Recovery Project..............       1,500,000
    Regional Brine Line.....................................      24,100,000
    E. Sources and Status of Nonfederal Funding
        The potential funding sources which have been identified to finance
    the implementation of the water recycling program include: $20,000,000
    USBR Grant; $20,000,000 Proposition 204 Water Recycling Loan; Recycled
    Water Sales--Wholesale; Metropolitan Local Projects Program
    ($35,000,000); Calleguas rates and charges (e.g., connections fees, new
    demand charges); Certificates of Participation or Water Revenue Bonds;
    and POTW's contributed funding to avoid nitrification expenses.
                                  water supply
    A. Amount of Recycled Water Put to Beneficial Use.
        Total ultimate project yield is 54,000 AFY. The recycled water
    produced from these projects will either be utilized for; agricultural
    purposes, landscape irrigation, groundwater recharge or direct
    consumptive use. The irrigation components of the projects increase the
    overall water supply to the region. In-lieu groundwater replenishment
    components of the projects will serve two purposes. First, the
    replenishment of the groundwater basin will aide in the correction of
    the existing groundwater overdraft problem. Secondly, the groundwater
    placed in storage will be subsequently recovered and used as a potable
    supply. The groundwater recovery projects will be put to beneficial use
    groundwater that would otherwise be unusable due to poor water quality
    and will therefore, increase the availability and reliability of the
    region's sources of supply.
    B. Describe and Quantify the Demands That Will Be Met With the Recycled
            Water.
        Calleguas is primarily dependent upon the Metropolitan Water
    District for its water supply. In fact, the District's entire drinking
    water supply is provided by the California State Water Project.
        Since 1964, the Districts population has quadrupled from 138,000 to
    520,000 in 1996 (roughly 75 percent of Ventura County's population.
    Rapid population and economic growth has placed additional demands on
    the District resulting in an increase in annual deliveries from 9,000
    AF to in excess of 95,000 AF in the same period. The projected demand
    for imported supplies in 202 is 148,000 AFY if no additional recycled
    water projects are implemented and 120,000 AFY if a majority of the
    proposed projects are implemented. If the proposed projects are fully
    implemented then Calleguas MWD does not need any additional imported
    supplies from MWD (e.g., Colorado River and SWP). This is very
    significant given the issues with the California 4.4 Plan and the
    CALFED Bay-Delta Program.
    C. How Would the Project Reduce Demand on Existing Federal Water Supply
            Facilities?
        Calleguas' only other water supply alternative is the Metropolitan
    Water District. Metropolitan has two sources of imported supplies, the
    Colorado River and the Sacramento Bay-Delta. In both watersheds the
    Federal government through the US Bureau of Reclamation is the primary
    stakeholder. To the extent Calleguas can lessen its demand for imported
    water from Metropolitan by developing local supplies, Metropolitan will
    correspondingly reduce is demand for Federal water through the Colorado
    River Aqueduct and the Sacramento Bay-Delta.
    D. Regional or Watershed Perspective?
        The program provides the following water supply and management
    benefits:
      --Enhanced Reliability: By enhancing and preserving the local sources
            of supply, the program will provide an increased measure of
            water supply reliability in the event of curtailment of
            imported water deliveries due to drought or earthquake. This
            reliability will ensure adequate supplies for thousands of area
            families and that the region will continue to meet the water
            needs of various industries. Moreover, the program will
            guarantee a long-term water supply for agricultural operations
            in the region.
      --Resource Conservation: Groundwater replenishment of the various
            aquifer systems underlying the Calleguas' service area will
            alleviate the prevailing overdraft condition and will also aide
            in the mitigation and prevention of further seawater intrusion.
      --Increased Level Of Independence: Since the early 1960's, much of
            urbanized Ventura County has become exceedingly reliant upon
            imported water deliveries. The program will assist the region
            in maximizing beneficial use of local water resources thereby
            decreasing the region's precarious dependence on unpredictable,
            imported water deliveries.
      --Delta Protection: Development of the program will benefit
            biological resources in the Sacramento bay-Delta due to reduced
            demands for imported water. To the degree that recycled water
            is utilized to supplant imported deliveries, an equivalent
            amount of water could remain in the Delta to aid in sustaining
            sensitive species and habitat.

        TABLE 1.--CALLEGUAS MUNICIPAL WATER DISTRICT SUMMARY OF WATER RECYCLING PROGRAM, YIELDS AND CAPITAL COSTS
    ----------------------------------------------------------------------------------------------------------------
                                                                                                         Estimated
                           Project Name/Phase                          Project Code    Project Yield      Project
                                                                                           (AFY)       Capital Costs
    ----------------------------------------------------------------------------------------------------------------
                         WASTEWATER RECLAMATION

    Simi Valley Wastewater Reclamation Project:
        Phase I.....................................................        RW.01.01             250      $1,500,000
        Phase II....................................................        RW.01.02           3,250     $15,000,000
        Phase III...................................................        RW.01.03           1,500      $8,500,000
                                                                     -----------------------------------------------
          Subtotal..................................................             N/A           5,080      25,000,000
                                                                     ===============================================
    Conejo Diversion Project (Hill Canyon Wastewater Reclamation
     Project):
        Phase I.....................................................        RW.02.01           6,000     $16,500,000
        Phase II....................................................        RW.02.02           8,000      $9,500,000
                                                                     -----------------------------------------------
          Subtotal..................................................             N/A          14,000     $26,000,000
                                                                     ===============================================
    Camarillo Wastewater Reclamation Project:
        Phase I.....................................................        RW.03.01           1,710      $1,200,000
        Phase II....................................................        RW.03.02           1,130      $3,000,000
                                                                     -----------------------------------------------
          Subtotal..................................................             N/A           2,840      $4,200,000
                                                                     ===============================================
    Oxnard Wastewater Reclamation Project:
        Phase I.....................................................        RW.04.01           5,000     $45,000,000
        Phase II....................................................        RW.04.02           5,000     $10,000,000
        Phase III...................................................        RW.04.03          10,000      $5,000,000
                                                                     -----------------------------------------------
          Subtotal..................................................             N/A          20,000     $60,000,000
                                                                     ===============================================
    Oak Park/North Ranch Wastewater Reclamation System Expansion:           RW.05.02             750      $1,750,000
     Phase II.......................................................
                                                                     ===============================================
    Moorpark Wastewater Reclamation Project:
        Phase I.....................................................        RW.06.01             757      $3,000,000
        Phase II....................................................        RW.06.02             953      $3,000,000
                                                                     -----------------------------------------------
          Subtotal..................................................             N/A           1,710      $3,000,000
                                                                     ===============================================
          Total Wastewater Reclamation..............................             N/A          44,300    $119,950,000
                                                                     ===============================================
                  BRACKISH GROUNDWATER RECOVERY PROJECT

    South Las Posas Brackish Groundwater Recovery Pro-  ject........        GW.01.01           5,258     $11,500,000
    West Simi Valley Brackish Groundwater Recovery Pro-  ject.......        GW.02.01           3,382      $7,100,000
    Thousand Oaks Brackish Groundwater Recovery Project.............        GW.03.01             900        $300,000
                                                                     -----------------------------------------------
          Total Brackish Groundwater Recovery Projects..............             N/A           9,540     $18,900,000
                                                                     ===============================================
                         REGIONAL BRINE DISPOSAL

    Regional Brine Disposal Pipeline:
        Phase I.....................................................        BD.01.01             N/A     $18,250,000
        Phase II....................................................        BD.01.02             N/A      $4,250,000
                                                                     -----------------------------------------------
          Total Regional Brine Disposal Pipeline....................             N/A             N/A     $22,500,000
    ----------------------------------------------------------------------------------------------------------------

                                     ______

     Prepared Statement of Michael D. Armstrong, General Manager, Monterey
                     County Water Resources Agency (MCWRA)
        Mr. Chairman, thank you for the opportunity to provide testimony
    for inclusion in the hearing record of the fiscal year 2000 Energy and
    Water Development Appropriations bill. The people of the Salinas Valley
    in California's 17th Congressional District appreciate your willingness
    to accept our statements in support of the Castroville Seawater
    Intrusion Project. I would further like to express our deep
    appreciation for this Subcommittee's efforts on past Energy and Water
    Development Appropriations bills. I am pleased to report that the
    project is complete and operational.
        As with the past five years the Monterey County Water Resources
    Agency has worked diligently to present the Subcommittee with an fiscal
    year 2000 funding request that is supported by the Administration as
    well as all the other Small Reclamation Loan Program participants.
    Through close consultation with the Bureau of Reclamation and other
    Program participants, we have developed the funding plans that were
    included in the President's fiscal year 2000 budget for the Public Law
    84-984 Small Reclamation Loan Program. I therefore respectively request
    that the Subcommittee provide the full Administration request for the
    project of $2,600,000.
        This is the sixth year of an eight year fiscal strategy designed to
    meet the requirements of all the projects in the Program while
    recognizing the fiscal constraints facing all levels of government.
    Originally, the Program was to provide all appropriations ($16,500,000)
    over a three year period. During the past five years this Subcommittee
    provided $9,264,000 for our project. The current appropriation amount
    of $2,600,000, when combined with other federal funding which is
    available from the U.S. Treasury in the amount of $4,550,000 pursuant
    to the Federal Credit Reform Act of 1990, should yield a total loan
    amount of $7,150,000 for fiscal year 2000 that will allow the project
    to proceed on schedule.
        The Monterey County Water Resources Agency (MCWRA) is a local
    government entity formed under the Monterey County Water Resources
    Agency Act. It is an agency with limited jurisdiction involving matters
    related primarily to flood control and water resources conservation,
    management, and development. The Salinas Valley is a productive
    agricultural area that depends primarily on ground water as a water
    supply. The combination of the Valley's rich soils, mild climate, and
    high quality ground water makes this Valley unique among California's
    most fertile agricultural lands and has earned the Valley the
    distinction as the ``Nation's Salad Bowl''. As agricultural activity
    and urban development have increased in the past forty years, ground
    water levels have dropped allowing seawater to intrude the coastal
    ground water aquifers. Seawater intrusion is extensive adjacent to the
    coast near the town of Castroville. The Castroville Seawater Intrusion
    Project will provide 19,500 acre-feet of recycled water annually for
    agricultural irrigation to over 12,000 acres and help solve the
    seawater intrusion problem by greatly reducing groundwater pumping in
    the project area. The Castroville Seawater Intrusion Project is an
    essential component in the MCWRA's plan to deal with basin-wide ground
    water overdraft and seawater intrusion.
        The amount requested in fiscal year 2000, when combined with the
    additional Treasury portion, is intended to fulfill the Bureau's sixth
    year loan commitment for assistance to construct the project. As stated
    above, the funding request that we anticipate is the result of a
    lengthy and complex financial agreement worked out with the other Loan
    Program participants and the Bureau. The agreement recognized the tight
    federal budgetary constraints and represents the absolute minimal
    annual amount necessary to proceed with the project. The MCWRA has been
    extremely accommodating of the Bureau's budgetary constraints and has
    agreed to expend considerable local funds to bridge the federal
    government's budgetary shortfall. Any additional cuts in federal
    funding will jeopardize the complex financing plan for the project.
        In August 1992, the original loan request was submitted to the
    Bureau. Subsequent approval was received from the Secretary of the
    Interior in May 1994. Through extensive discussion and negotiations
    between the MCWRA and the Bureau, a project financing plan was created.
    The Bureau made it quite clear that the original provisions in the loan
    application of full disbursement during the three years of construction
    could not be met due to federal budget shortfalls. As defined in the
    repayment contract, the Bureau will disburse funds to the MCWRA over an
    eight-year period. This means that the MCWRA will receive these funds
    for five years after the project is operational. The fiscal year 1999
    funding provided monies for the second year after completion of the
    project. The MCWRA had to acquire ``bridge financing'' to meet the
    needs of the Castroville Seawater Intrusion Project construction costs.
    Even though the additional private debt service has increased the
    project costs, the critical problem of seawater intrusion demanded that
    the project proceed. The Bureau loan is a crucial link in project
    funding, and it is imperative that the annual appropriations, even at
    the planned reduced rate over eight years, continue. Federal
    appropriations have been received in fiscal years 1995, 1996, 1997,
    1998, and 1999 as shown in the table below and must continue in
    subsequent years in accordance with the negotiated agreement in order
    for the projects to be successful. The federal funds requested under
    the Public Law 84-984 program will be repaid by landowners in the
    Salinas Valley with assessments that are currently in place. The MCWRA
    has spent approximately $36,000,000 of its own funds getting to this
    point.

                                               FEDERAL APPROPRIATIONS \1\
                                                  [Millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                          Received   Received   Received   Received   Received  Requested
                                          in 1995    in 1996    in 1997    in 1998    in 1999    for 2000    Total
    ----------------------------------------------------------------------------------------------------------------
    CSIP...............................      1.064        1.5        2.0        2.1        2.6        2.6     11.864
    ----------------------------------------------------------------------------------------------------------------
    \1\ Does not include Treasury portion of $9.092 for CSIP.

        Mr. Chairman, we urge you and the members of the Subcommittee to
    give your continued support to the Small Reclamation Program and we
    urge the inclusion of funds for the Castroville Seawater Intrusion
    Project. Without your continued support, we will not be able to realize
    the benefit of the work completed over the past several years and the
    Salinas ground water basin will continue to deteriorate, creating a
    significant threat to the local and state economies as well as to the
    health and welfare of our citizens.
        Again, thank you for your support and continued assistance.
                                     ______

    Prepared Statement of Keith Israel, General Manager, Monterey Regional
                    Water Pollution Control Agency (MRWPCA)
        Mr. Chairman, thank you for the opportunity today to provide this
    testimony for inclusion in the hearing record on the fiscal year 2000
    Energy and Water Development appropriations bill. But most importantly,
    let me express my sincere appreciation for your continued support for
    the Small Reclamation Projects Loan Program, and specifically, the
    funding for the Salinas Valley Reclamation Project. During the past
    five years, this subcommittee provided $6,500,000 for our project. I am
    pleased to report that the funds appropriated thus far have been well
    spent on our project, which began construction in August 1995. The new
    facility was dedicated in October 1997 with full operation beginning in
    April 1998, and since full operation, the plant has produced somewhat
    over 5,000 acre-feet (AF) of recycled water.
        The project will ultimately provide 19,500 acre-feet of recycled
    water per year to land south and west of Castroville where abandonment
    of wells threatens agricultural production and the loss of a portion of
    rural America. It will also reduce discharge of secondary treated
    wastewater to the recently created Monterey Bay National Marine
    Sanctuary. In addition, the California State Water Resources Control
    Board specifically indicated its strong support for the Salinas Valley
    Reclamation Project in a prior letter to the U.S. Bureau of
    Reclamation.
        The Monterey Regional Water Pollution Control Agency (MRWPCA), a
    joint-powers entity formed under the laws of the State of California,
    was created in 1971 to implement a plan that called for consolidation
    of the Monterey Peninsula and northern Salinas Valley wastewater flows
    through a regional treatment plant and an outfall to central Monterey
    Bay. The plan also required studies to determine the technical
    feasibility of using recycled water for irrigation of fresh vegetable
    food crops (artichokes, celery, broccoli, lettuce, and cauliflower) in
    the Castroville area. These studies were initiated in 1976 and included
    a five-year full-scale demonstration of using recycled wastewater for
    food crop irrigation. California and Monterey County health departments
    concluded in 1988 that the water was safe for food crops that would be
    consumed without cooking. Subsequently, the Salinas Valley Seawater
    Intrusion Committee voted to include recycled water in their plan to
    slow seawater intrusion in the Castroville area.
        In addition, a supplemental water testing program (October 1997
    through March 1998) was initiated to confirm the new plant's removal of
    what are termed ``emerging pathogens.'' These organisms, which include
    Cryptosporidium, Giardia, Cyclospora, and E. Coli, were not evaluated
    in the original five-year field study. The results of the follow-up
    testing program again verified that the water is safe for irrigation of
    food crops.
        As in the past, we have been in close consultation with the Bureau
    of Reclamation and the other Small Reclamation Projects Loan Program
    participants in an attempt to provide the Committee with a consensus
    budget request that has the support of the Administration and the Loan
    Program participants. Based on these discussions, the Administration
    requested, with our support and endorsement, sufficient funding for the
    Salinas Valley Reclamation Project as part of the Bureau of
    Reclamation's Public Law 84-984 Small Reclamation Projects Loan Program
    for continuation of loan obligations. This appropriation amount,
    $1,700,000, when combined with other federal funding which is available
    from the U.S. Treasury pursuant to the Federal Credit Reform Act of
    1990, will yield a total loan amount that we believe will meet the
    federal government's commitment for fiscal year 2000. The amount
    requested, when combined with the additional Treasury portion, is
    intended to fulfill the Bureau's sixth-year loan commitment for
    assistance to construct the project.
        As I indicated, the funding request is the result of a lengthy and
    complex financial agreement worked out with the other Loan Program
    participants and the Bureau. The agreement represents the absolute
    minimum annual amount necessary to continue with the project. The
    MRWPCA worked under the premise of accommodating the Bureau of
    Reclamation's budgetary constraints and is expending considerable local
    funds to bridge the federal government's budgetary shortfall. Any
    additional cuts in federal funding will jeopardize the complex
    financing plan for the project.
        The MRWPCA has received Federal Grant and Loan Funds in Federal
    fiscal year 1995, fiscal year 1996, fiscal year 1997, fiscal year 1998,
    and fiscal year 1999 through February 4, 1999, as follows:

                                               FEDERAL APPROPRIATIONS \1\
                                                  [Millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                          Received   Received   Received   Received   Received  Requested
                                          in 1995    in 1996    in 1997    in 1998    in 1999    for 2000    Total
    ----------------------------------------------------------------------------------------------------------------
    SVRP...............................  .........        2.0        1.5        1.3        1.7        1.7        8.2
    ----------------------------------------------------------------------------------------------------------------
    \1\ Does not include Treasury portion of $6,205,000 for SVRP.

        Even though the additional private debt service and bridge
    financing will increase the project costs, the critical problem of
    seawater intrusion demands that the project be continued. The Bureau of
    Reclamation loan is a crucial link in project funding, and it is
    imperative that annual appropriations continue, even at the planned
    reduced rate over eight years. The federal funds requested under the
    Public Law 84-984 program will be repaid by landowners in the Salinas
    Valley with assessments that are currently in place. Local funds
    totaling $21,200,000 have already been spent getting to this point.
        Mr. Chairman, we urge you and the members of the subcommittee to
    give your continued support to the Small Reclamation Projects Loan
    Program, and specifically, funding for the Salinas Valley Reclamation
    Project. Your support and continued assistance for this critical
    project is greatly appreciated.
                                     ______

        Prepared Statement of Bruce George, Manager, Kaweah Delta Water
                             Conservation District
        Mr. Chairman and Members of the Subcommittee: My name is Bruce
    George, and I am the Manager of the Kaweah Delta Water Conservation
    District in the eastern San Joaquin Valley of California. Thank you for
    the opportunity to present testimony regarding the fiscal year 2000
    budget for the U.S. Army Corps of Engineers.
        The President's fiscal year 2000 budget request for the Corps of
    Engineers includes $582,000 to complete pre-construction engineering
    and design (PED) of a project to increase the water storage capacity of
    Terminus Dam at Lake Kaweah in California's San Joaquin Valley. The
    project would add approximately 43,000 acre-feet of flood control and
    conservation storage space to Lake Kaweah by raising the Terminus Dam
    spillway by 21 feet. The estimated total first cost of the project is
    $35,000,000.
        The President's budget also provides $1,680,000 for ongoing
    operation and maintenance of Terminus Dam in fiscal year 2000. The
    Kaweah Delta Water Conservation District and its project cosponsors
    support these PED and operation and maintenance requests.
        In addition to the amounts proposed in the President's budget, we
    respectfully request a General Construction appropriation of $2,500,000
    to initiate construction of the Terminus spillway project in fiscal
    year 2000 and keep the project on schedule.
        The Corps of Engineers has been actively studying and planning this
    modest project for more than 10 years. During that time, the Kaweah
    Delta Water Conservation District and other local authorities have
    invested $1,800,000 of their owns funds in the planning and development
    process. The State of California is committed to be the lead non-
    federal sponsor of the project. Other local sponsors are the counties
    of Kings and Tulare, the City of Visalia and the Tulare Lake Basin
    Water Storage District.
        Under the Corps' current schedule, pre-construction engineering and
    design will be completed in the spring of 2000. With an additional
    appropriation of $2,500,000, the Corps could begin construction work in
    the early summer. A commitment of construction funding for fiscal year
    2000 would save time and money for all parties by allowing formal cost-
    sharing agreements to be signed sooner, clearing the way for the
    expenditure of state and local funds for the acquisition of real estate
    and valuable environmental mitigation lands.
        The California Water Commission supports a $2,500,000 General
    Construction appropriation for the Terminus Project in addition to the
    amounts requested in the President's fiscal year 2000 budget for pre-
    construction and operation and maintenance. The State of California has
    already appropriated funds for the purchase of mitigation lands, and
    the state and other non-federal sponsors have budgeted their required
    funds for fiscal year 2000.
                                   background
        The Kaweah Delta Water Conservation District was formed in 1927 to
    conserve and protect the surface and groundwater of the Kaweah delta.
    The District serves 337,000 acres, which include the cities of Visalia
    and Tulare and several other incorporated and unincorporated areas in
    Kings and Tulare counties. Those two counties consistently rank among
    the most productive agricultural counties in the nation.
        Terminus Dam and Lake Kaweah, located on the Kaweah River three and
    one-half miles east of the District, was completed in 1962 by the U.S.
    Army Corps of Engineers. The purpose of the project is to provide
    storage space for flood protection and irrigation on the Kaweah River.
    The Conservation District manages the irrigation and flood control
    releases for Lake Kaweah, as well as assisting in the conjunctive use
    of the surface and groundwater of the Kaweah delta.
        Flooding downstream from the dam occurs when flows from individual
    creeks blend together and form a sheet flow through urban and
    agricultural areas. Included in the flooded areas are the communities
    of Visalia, Farmerville, Tulare, Ivanhoe and Goshen. Since construction
    of Terminus Dam, 10 damaging floods have occurred, the most recent in
    1997 and 1998.
        Inadequate flood protection and a long-term groundwater overdraft
    in the region have created a need for greater reservoir storage space
    for flood control and irrigation storage. With a maximum capacity of
    143,000 acre-feet, Lake Kaweah currently provides a less than 50-year
    level of flood protection for communities downstream. Raising the
    spillway at Terminus Dam (by the installation of fuse gates) would
    increase the reservoir storage capacity by 30 percent, thus providing a
    much higher level of flood protection for the region.
        California's growing population will place ever-increasing demands
    on its water supply and flood control infrastructure. Improving
    existing facilities such as Terminus Dam is one of the most economical
    and environmentally sensitive ways to meet those new demands. It is
    important for Congress to encourage such projects.
        We are grateful for the Committee's continued support of the
    Terminus project.
                                     ______

       Prepared Statement of Michael Di Giorgio, Mayor, City of Novato,
                                   California
        Mr. Chairman and Members of the Subcommittee: My name is Michael Di
    Giorgio, and I am the Mayor of the City of Novato, California, located
    20 miles north of San Francisco. Thank you for the opportunity to
    present testimony regarding the fiscal year 2000 budget for the U. S.
    Army Corps of Engineers.
        The City of Novato requests $600,000 in fiscal year 2000 for Phase
    II of the Novato Urban Flood Control Project, a Section 205 small flood
    control project on Rush Creek. Phase II improvements are necessary to
    maximize the value of the Phase I work, for which Congress earmarked
    $350,000 in fiscal year 1999.
        Once completed, the Rush Creek project will resolve chronic
    flooding in the downtown area of the City of Novato. Flooding has
    occurred on Rush Creek in three of the last four rainy seasons,
    damaging residential and commercial property, local infrastructure, and
    jeopardizing public safety.
        Included in the City's scope of work for Phase II of the Novato
    Urban Flood Control project is a new culvert under Olive Avenue, flood
    flow pipes from Olive Avenue to Golden Gate Place, and earth channel
    dredging from Golden Gate Place to the Caltrans U.S. Highway 101 right-
    of-way. The City is prepared to cost share this project consistent with
    the authorization.
        The City is optimistic that only one additional year of funding
    will be necessary, beyond the requested appropriation for fiscal year
    2000, to bring Rush Creek flood flows under control. The total cost for
    this project is estimated at $2,000,000, including the local share.
                                   background
        In the past, the City of Novato has spent over $9,000,000, from
    property assessments, to pay for local creek improvements and other
    flood control measures. In 1985, a local election approved benefit
    assessment funds to finance flood control improvements for the City of
    Novato. These funds are completely expended with a portion of the work
    left uncompleted. Until the fiscal year 1999 appropriation, no federal
    funds had been utilized for those channel improvements in the City.
        Currently, the community pays more than $100,000 annually in flood
    insurance, and 2,958 parcels are located within the special flood
    hazard area, based on the flood insurance rate maps prepared by the
    Federal Emergency Management Agency (FEMA). Following completion of the
    Rush Creek improvements, it is expected that a re-mapping of the FEMA
    flood insurance maps would reduce the community outlay for flood
    insurance.
                                     ______

       Prepared Statement of Joe Serna, Jr., Mayor, City of Sacramento,
                                   California
        On behalf of the City of Sacramento, I would like to thank you for
    the opportunity to provide testimony to the Senate Appropriations
    Subcommittee on Energy and Water Development in support of fiscal year
    2000 funding for flood control protection projects in Sacramento.
    First, I would like to express my appreciation to the Subcommittee for
    its efforts in past years to fund flood protection measures for the
    City. Sacramento, California, continues to face the highest flood risk
    in the nation. During the past several years, the Energy and Water
    Appropriations Subcommittee has recognized the dire need for flood
    protection in and around the Sacramento area and has provided funds for
    a variety of previously authorized projects. In order to continue our
    efforts, we must once again request your support for funding vital
    Sacramento area flood control projects in fiscal year 2000.
        This year, the City of Sacramento is seeking $43,100,000 in federal
    funding through the U.S. Army Corps of Engineers in order to finance
    ongoing projects, which are described below and in the enclosed chart.
    The projects include the so-called ``common elements'' authorized in
    the 1996 Water Resources Development Act as well as other projects
    previously authorized.
        The Clinton Administration's fiscal year 2000 budget provides
    $34,000,000 for these projects, which is $9,100,000 less than the
    City's request. The major difference is that the Corps of Engineers did
    not include construction money for the South Sacramento Stream Group
    Project. If the Congress authorizes a Water Resources Development Act
    (WRDA) this year, construction money could be used for this important
    project in fiscal year 2000. The City urgently needs the Subcommittee's
    leadership and support to obtain our full funding request in order to
    move forward with these previously authorized projects.
        The U.S. Army Corps of Engineers proposed budget for fiscal year
    2000 recently submitted to Congress provides $17,000,000 for
    continuation of construction of the Common Elements Project. This level
    of funding is necessary to keep the project moving forward and we
    support the Administration's request. The Common Elements Project is a
    vital first step in our flood control efforts and full funding to keep
    this project on track is essential.
        The City of Sacramento has been working in cooperation with the
    Sacramento Area Flood Control Agency (SAFCA) on the construction of
    bank protection improvements which are vital to correct harmful erosion
    along the banks of the American River which threatens the integrity of
    our existing levees. Additional improvements will be needed over the
    next several years to prevent erosion at other American River sites.
    This work is already authorized under the Sacramento River Bank
    Protection Project which is used to fund erosion control projects
    throughout the Sacramento River System. The President's budget proposes
    $7,000,000 for the Sacramento River Bank Protection Project, which we
    fully support and urge the Subcommittee to support.
        Due to the significant flood risk along creeks in the South
    Sacramento area, the U.S. Army Corps of Engineers, submitted the South
    Sacramento Streams Group Chief's Report to Congress for inclusion in
    WRDA 1998. We urge the Subcommittee to fund design and construction for
    this project in the fiscal year 2000 Corps of Engineers' budget.
        Under the Corps' Section 205 program, a feasibility study and
    environmental documentation have been completed for a project that
    would provide a high degree of flood protection on Magpie Creek. This
    year the President has requested $26,900,000 for all Section 205 flood
    control projects. We urge the Subcommittee to support Section 205
    funding in the fiscal year 2000 budget and recommend that the Corps of
    Engineers be directed to provide sufficient funds for completion of the
    Magpie Creek project in its distribution of Section 205 funds.
        For the American River Watershed (Natomas) improvements which were
    authorized by Congress in 1992, we are seeking continued construction
    appropriations in the amount of $4,000,000 for reimbursement to SAFCA
    for the Federal share of the flood control improvements, as well as
    $3,900,000 in construction appropriations to complete the Ueda Parkway
    recreation elements of the project.
        The President's Budget for fiscal year 2000 provides for $5,000,000
    in Preconstruction, Engineering and Design (PED) funds for the American
    River Watershed comprehensive plan. The City, SAFCA, and the
    Reclamation Board and members of our congressional delegation are
    working diligently on congressional authorization of additional
    improvements on the American River system as part of the 1999 Water
    Resources Development Act. Once authorized, the Corps of Engineers will
    need significant funds to proceed with meaningful design in 2000 and
    not lose a year in the schedule to implement these improvements.
    Therefore, we urge the Subcommittee to support $5,000,000 in PED funds
    for the American River Watershed comprehensive plan.
        Once again, thank you for the opportunity to submit this statement
    and for your consideration of the funding that the City of Sacramento
    needs to protect its residents. Adequate flood protection is essential
    in this most flood-prone of American cities. We thank you again for the
    Subcommittee's commitment in previous years to providing this vital
    protection, and we ask for your renewed support in assuring its
    continuation.

                                     FISCAL YEAR 2000 SACRAMENTO AREA FLOOD CONTROL
                                                [In millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                       Fiscal year
                                Project                                Fiscal year     2000  city/     Fiscal year
                                                                      1999 enacted   SAFCA  request   admin. request
    ----------------------------------------------------------------------------------------------------------------
     American River Comprehensive Plan: Funds to continue the                  0.05             5.0             5.0
     planning and design of Sacramento flood protection projects...
    American River Common Elements: 24 miles of levee improvements             15.0            17.0            17.0
     along the American River and 12 miles of improvements along
     the Sacramento River levees, flood gauges upstream of Folsom
     Dam, and improvements to the flood warning system along the
     lower American River..........................................
    South Sacramento Streams: Prevention of flooding of portions of             0.9         \1\ 4.0             0.5
     Sacramento from the south, where four creeks convey foothill
     runoff through urbanized areas into Beach Lake and the Delta..
    Mapgie Creek: Authorized under the Corps' Section 205 program,             1.65             1.7       \2\ (26.9)
     this project will provide a high degree of flood protection on
     Magpie Creek..................................................
    Sacramento River Bank Protection: Will correct harmful erosion            10.08             7.0             7.0
     along the banks of the American River which threatens the
     integrity of the existing levees..............................
    American River Watershed (Natomas): Reimbursement to SAFCA for              9.0             4.0             4.0
     the Federal share of the flood control improvements undertaken
     by the local project spon-  sor...............................
    American River Watershed (Natomas Recreation, Ueda Parkway): A              0.0             3.9             0.0
     waterway, bike and pedestrian path that connects all of
     Sacramento as the recreation component of the recently-
     completed Natomas Flood Control Project (see above)...........
    Lower Strong & Chicken Ranch Sloughs (DO5 Pump Station): a                  N/A             0.5             0.5
     feasibility study to restore 100-year level of flood
     protection to Chicken Ranch Slough drainage to the American
     River.........................................................
                                                                    ------------------------------------------------
          Total....................................................           36.68            43.1            34.0
    ----------------------------------------------------------------------------------------------------------------
    \1\ Construction funds assume passage of WRDA in 1999.
    \2\ Total request for the Corps of Engineers Section 205 programs. No specific earmark is available for Magpie
      Creek. This funding level is therefore not included in the total.

                                     ______

       Prepared Statement of the Metropolitan Water District of Southern
                                   California
        Chairman Domenici and members of the subcommittee. The Metropolitan
    Water District of Southern California (MWD) appreciates the opportunity
    to submit testimony regarding the U.S. Bureau of Reclamation's
    (Reclamation) and the Army Corps of Engineers' (Corps) fiscal year
    (fiscal year) 2000 budget, for the Hearing on Energy and Water
    Appropriations. MWD is a public agency created in 1928 to meet the
    supplemental water demands of those people living in what is now
    portions of a six-county region of Southern California. Today, the
    region served by MWD includes 16,000,000 people living on the coastal
    plain between Ventura and the international boundary with Mexico. It is
    an area larger than the State of Connecticut and, if it were a separate
    nation, would rank in the top ten economies of the world.
        Included in our region are more than 225 cities and unincorporated
    areas in the counties of Los Angeles, Orange, San Diego, Riverside, San
    Bernardino, and Ventura. We provide more than half the water consumed
    in our 5,200-square-mile service area. MWD's water supplies come from
    the Colorado River via the district's Colorado River Aqueduct and from
    northern California via the State Water Project's California Aqueduct.
                                  introduction
        Our testimony focuses on Reclamation's water resources management
    and ecosystem restoration programs that are of major importance to MWD
    and other Southern California water supply agencies. Specifically, MWD
    strongly recommends your approval of a Reclamation fiscal year 2000
    budget that includes full funding for San Francisco Bay-Sacramento/San
    Joaquin Delta Estuary restoration activities, as requested in the
    President's budget. We also recommend your approval of the full budget
    request for Corps participation in these Delta restoration activities.
    MWD urges your support for adequate federal funding for Reclamation's
    Colorado River Basin Salinity Control Program that will ensure
    protection of water quality for this important source of water supply.
    MWD also urges your support for Reclamation's Endangered Species
    Conservation/Recovery projects that will provide for conservation of
    endangered and threatened species and habitat along the lower Colorado
    River, and provide mitigation for impacts associated with Reclamation's
    projects. Finally, MWD urges your full support for Reclamation programs
    that will help stretch existing water resources, such as water
    reclamation and groundwater recovery projects for Southern California
    agencies. These programs are essential for regional water supply
    reliability.
                       u.s. bureau of reclamation budget
    California Bay-Delta Ecosystem Restoration
        In 1996, Congress passed the California Bay-Delta Environmental and
    Water Security Act, which authorized $430,000,000 over three years for
    ecosystem restoration and water management improvements in the San
    Francisco Bay-Delta Estuary. The Bay-Delta serves as the hub of
    California's water system, fueling the State's $750,000,000,000
    economy, supplying more than two-thirds of the State's 33,000,000
    residents with a portion of their drinking water and irrigating 45
    percent of the nation's produce.
        Recognizing the importance of the Bay-Delta to California's
    economic and environmental health, the California voters approved a
    $1,000,000,000 general obligation bond in November 1996, which contains
    $600,000,000 for improvements in the estuary.
        In 1999, $75,000,000 was appropriated for environmental restoration
    activities in the Bay-Delta. The Administration's fiscal year 2000
    budget request of $95,000,000 represents the first year of broad
    program implementation for the CALFED Bay-Delta Program. This federal
    money for the Bay-Delta will fund an array of critical improvements,
    including habitat restoration, watershed protection, fishery
    enhancement, water supply reliability and water quality improvement.
    MWD strongly urges your support for the restoration of one of the
    largest estuaries in the nation by ensuring the appropriation of these
    critically-needed funds.
    Colorado River Basin Salinity Control
        The Colorado River is a large component of the regional water
    supply and its relatively high salinity causes significant economic
    impacts on water customers in the MWD's service area, as well as
    throughout the Lower Colorado River Basin. For this reason, MWD and the
    Bureau of Reclamation are currently conducting a Salinity Management
    Study in Southern California. The first phase of the study (completed
    in February 1997) concluded that the high salinity from the Colorado
    River causes significant impacts to residential, industrial and
    agricultural water users. Furthermore, high salinity adversely affects
    the region's progressive water recycling programs, and is contributing
    to an adverse salt buildup through infiltration into Southern
    California's irreplaceable groundwater basins. The second phase of the
    study is scheduled to be completed in July 1999. Based on a 1988 study,
    Reclamation estimated that water users in the Lower Basin were
    experiencing in excess of $750,000,000 in annual impacts from salinity
    levels in the river in 1995, and that impacts would progressively
    increase with continued agricultural and urban development upstream of
    California's points of diversion. As part of the Salinity Management
    Study, the economic impacts have been refined for MWD's service area
    and have been submitted to Reclamation for its use in updating its
    Lower Basin estimate. Droughts will cause spikes in salinity levels
    that will be highly disruptive to Southern California water management
    and commerce. The Salinity Control Program has proven to be a very
    cost-effective approach to help to mitigate the impacts of higher
    salinity. Continued federal funding of the program is essential.
        The Colorado River Basin Salinity Control Forum (Forum), the
    interstate organization responsible for coordinating the Basin states'
    salinity control efforts, issued its 1996 Review, Water Quality
    Standards for Salinity, Colorado River System (1996 Review) in June
    1996. The 1996 Review found that additional salinity control was
    necessary beginning in 1994 to meet the numeric criteria in the water
    quality standards adopted by the seven Colorado River Basin states and
    approved by the U.S. Environmental Protection Agency, with normal water
    supply conditions. For the last four years, federal appropriations for
    Reclamation have not equaled the Forum-identified funding need for the
    portion of the program the Federal Government has the responsibility to
    implement. It is essential that implementation of Reclamation's
    basinwide salinity control program be accelerated to permit the numeric
    criteria to be met again under average annual long-term water supply
    conditions, making up the shortfall. To assist in eliminating the
    shortfall, the Forum once again recommends that Reclamation utilize
    upfront cost sharing from the Basin states to supplement federal
    appropriations. This concept has been embraced by Reclamation and is
    reflected in the President's proposed budget.
        The President's proposed fiscal year 2000 budget contains funding
    of $12,000,000 for implementation of the basinwide program. MWD
    requests that Congress appropriate $17,500,000 for implementation of
    the basinwide program, an increase of $5,500,000 from that proposed by
    the President. This level of funding is necessary to meet the salinity
    control activities schedule in order to maintain the state adopted and
    federally approved water quality standards. The Forum supports this
    level of funding. MWD as well as the Forum supports the level of
    funding proposed by the President for operation and maintenance of the
    salinity control units already constructed, and investigations.
    Endangered Species Conservation/Recovery
        MWD is presently engaged in an innovative partnership with
    Reclamation and other Department of the Interior agencies, as well as
    other water, power, and wildlife agencies, environmental organizations,
    and Indian Tribes in the states of Arizona, California, and Nevada, to
    develop a multi-species conservation program for the Lower Colorado
    River. The program will address the conservation, enhancement, and
    recovery needs of a broad suite of more than 70 listed and sensitive
    species and their associated aquatic, wetland, and riparian habitats in
    the three states, while providing long-term regulatory certainty for
    all parties. An effort of this nature can only succeed through the
    development of innovative voluntary public-private partnerships.
        MWD encourages your support for Reclamation's participation in the
    Lower Colorado River Multi-Species Conservation Program. Reclamation's
    participation in this program has been a valuable asset to the
    partnership. Funds provided under this project will in part help fund
    critically needed interim conservation measures for endangered species
    and their habitats, as well as planning under the long-term
    conservation program.
        The President's budget requests $15,118,000 for fiscal year 2000 to
    fund programs under the ``Endangered Species Conservation/Recovery''
    activity and $13,540,000 to fund programs under the ``Lower Colorado
    River Ops Program'' activity. Included in the former amount are funds
    to support preservation, conservation, and recovery of native and
    endangered, threatened, proposed, and candidate species in the Lower
    Colorado River region. Included in the latter amount are funds to
    implement measures required by the interim biological opinion on
    Reclamation's lower Colorado River operations, and develop the multi-
    species conservation program. MWD strongly supports funding at the
    requested levels.
    National Fish and Wildlife Foundation
        The National Fish and Wildlife Foundation (Foundation) facilitates
    implementation of fish and wildlife mitigation and enhancement programs
    associated with Reclamation's projects through cost-sharing
    partnerships with local, state, tribal, and/or nongovernmental
    organizations. The Foundation is able to leverage federal dollars on at
    least a 1:1 matching basis.
        The Foundation's support for programs like the Lower Colorado River
    Multi-Species Conservation Program is extremely important to the
    development of comprehensive solutions to these complex endangered
    species issues. An effort of this nature can only succeed through the
    development of innovative voluntary public-private partnerships.
        The President's budget requests $1,300,000 for fiscal year 2000,
    which anticipates a two dollar nonfederal match for each federal
    dollar. MWD strongly supports the President's requested level of
    funding.
    Water Recycling and Groundwater Recovery
        Projects funded under Title XVI of the Reclamation Projects
    Authorization and Adjustment Act of 1992 (Public Law 102-575) and the
    Reclamation Recycling and Water Conservation Act of 1996 (Public Law
    104-266) as well as the Bureau's Loan Program will greatly improve
    Southern California's water supply reliability and the environment
    through effective water recycling and recovery of contaminated
    groundwater. Implementation of such projects is difficult without
    combined federal, state and regional assistance for planning, design
    and construction. MWD expects to contribute about $20,600,000 in fiscal
    year 2000 to recycled water and groundwater recovery projects in the
    region, and the State is assisting with low-interest loans. Funding in
    the fiscal year 2000 budget for previously unfunded projects as well as
    the continued support for previously-funded projects is a positive step
    toward realizing regional water supply reliability. MWD urges your full
    support for the $31,514,000 for Title XVI and $12.425 for the Loan
    Program in the President's fiscal year 2000 budget, as well as future
    funding for all Southern California projects that might move forward
    under the jointly-funded Southern California Comprehensive Water
    Reclamation and Reuse Study.
    Brackish Water Desalination
        Metropolitan requests for federal funding, appropriations for
    desalination activities aimed at developing new and innovative
    technologies. Technologies to be investigated include innovative
    pretreatment options such as nanofiltration, ultra low pressure reverse
    osmosis membranes, and carbon aerogel capacitive deionization (CDI).
    Brackish water desalination represents a potentially viable alternative
    to reduce reliance on imported water supplies and minimize the economic
    impact associated with high salinity water. Current salinity removal
    technologies are energy-intensive and expensive. Treating Colorado
    River water to the secondary total dissolved solids (TDS) standard,
    using conventional membrane technology, can cost $300 or more per acre-
    foot. These high costs have precluded the widespread implementation of
    brackish water desalination technologies, especially for large-scale
    applications. Breakthroughs in desalination technology will offer
    potential benefits to water utilities with sources impaired by high
    salinity levels. It is estimated that $2,000,000 will be required to
    continue this research being sponsored by Metropolitan and its member
    agencies.
                            army corps of engineers
        The Army Corps of Engineers' (Corps) comprehensive civil works
    program has the capability to contribute to the social, economic, and
    environmental well-being of California. MWD is primarily interested in
    the Corps' environmental restoration studies and projects that address
    the needs of the Bay-Delta Estuary.
        The President's proposed fiscal year 2000 budget includes numerous
    programs in the Corps' South Pacific Division, which includes
    California. Several ecosystem restoration studies and projects
    specifically address significant habitat issues at various locations in
    the Bay-Delta watershed. These ecosystem restoration and flood
    prevention programs, and the Corps' full participation in CALFED Bay-
    Delta efforts, represent an important opportunity in the process of
    developing and implementing a solution to the water resources and
    environmental problems facing the Bay-Delta Estuary. Corps programs
    that will contribute to the long-term Bay-Delta solution include
    environmental restoration studies in the Sacramento and San Joaquin
    River watersheds, habitat conservation and mitigation elements of flood
    damage prevention projects, and ecosystem restoration programs.
        MWD urges Congress to fully support these Corps programs as the
    fiscal year 2000 federal appropriations process moves forward.
        Thank you for your consideration of our testimony. We believe our
    comments emphasize the importance of continued funding for Reclamation
    and Corps' water resources management and ecosystem restoration
    programs that are critical for water supply reliability in Southern
    California.
                                     ______

      Letter From Lawrence M. Libeu, President, Western Coalition of Arid
                                     States
                              Eastern Municipal Water District,
                                            Perris, CA, March 22, 1999.
    Hon. Pete V. Domenici,
    Chairman Senate Appropriations Subcommittee, on Energy and Water
            Development, Dirksen Senate Office Building, Washington, DC.
        Dear Chairman Domenici and Members of the Subcommittee: As the
    President of the Western Coalition of Arid States (WESTCAS) and as
    Chairman of the National Water Resources Association's (NWRA) Water
    Resources Management Committee, I am writing to urge your support for
    the $12,425,000 contained in the President's fiscal year 2000 Budget
    Request for the five projects in the Bureau of Reclamation's Small
    Reclamation Loan Program. The funding that would be provided will move
    these projects closer to completion in a timely manner so the Federal
    Government and the local districts can see a return on the investment
    regarding this vital infrastructure program.
        I appreciate that under the Balanced Budget Agreement between the
    Congress and the President that every program and the dollars for those
    programs are looked at with a critical eye in terms of the worthiness
    of the investment. This is why I am concerned with the trends that I
    have seen regarding the overall Bureau of Reclamation budget. I believe
    the Bureau's budget needs to be focused and increased to place a
    greater emphasis on completing the authorized project and programs that
    are already on the books.
        I want to thank your subcommittee for its past support and would
    ask that your subcommittee continue to support this valuable program.
                Sincerely,
                                             Lawrence M. Libeu,
                                                     WESTCAS President.
                                     ______

     Prepared Statement of Steve Miklos, Mayor, City of Folsom, California
                   section 503 watershed restoration project
        Mr. Chairman and Members of the Subcommittee. My name is Steve
    Miklos and I am the Mayor of the City of Folsom, California, located
    approximately 25 miles east of Sacramento. Thank you for the
    opportunity to present testimony regarding the fiscal year 2000 budget
    for the U.S. Army Corps of Engineers.
        The City of Folsom is an historic gold rush town, dating back to
    the mid-1800s. As such, the storm drainage system in the original
    portion of the city is inefficient and unsophisticated at best. The
    untreated storm runoff from this area flows directly into Lake Natoma
    and the American River. To study and address needed water quality-
    related improvements and restoration of the City's urban watershed, the
    City of Folsom requests $500,000 in fiscal year 2000 to continue a
    Section 503 Watershed Restoration Project.
        The Section 503 funding is necessary for technical, planning and
    design assistance with the City storm drainage system, which directly
    impacts water quality in the American River and the Sacramento River
    watershed. The Sacramento River watershed is specifically authorized in
    the Water Resources Development Act of 1996 to receive funding under
    this program. Recent hydrology studies suggest that the existing storm
    drainage systems in Folsom should be upgraded to handle heavier and
    sustained water runoff. Left unresolved, these storm drainage problems
    will continue to pose a threat to water quality in the American River
    and the Sacramento River watershed. Analysis of the current drainage
    system will help us determine how to minimize these problems.
        Historic Folsom drains by a system of roadside ditches, swales,
    street culverts, and urban streams that traverse through the area. The
    hills are steep, and the ground is a mixture of gravels, soils, and
    granite outcroppings. One major urban stream system has become so
    interlaced with the above, that it flows under structures, is
    intertwined with pipes and culverts and, under flood conditions,
    impacts several properties. This creates problems during heavy rains
    for numerous residents, businesses, and vehicular traffic, conveying
    sediment into the river, flooding roadways and neighborhoods. This
    system drains into Lake Natoma through the historic Powerhouse State
    Park. Constant erosion has been an ongoing problem in these roadside
    ditches and yards. Another section of Historic Folsom drains overland
    through our City Corporation Yard, which includes a landfill, and into
    Lake Natoma.
        In fiscal year 1999, Congress earmarked $100,000 to initiate a
    Section 503 Watershed Study on these storm drainage problems. Staff has
    met several times with Corps staff to identify the problem and
    investigate solutions. The 905b study is underway and is expected to be
    completed in the summer of 1999.
        The City of Folsom has committed over $2,000,000 in local funds for
    watershed study and storm drainage improvements throughout the
    community. While this work has greatly improved storm drainage in
    certain areas, additional work is still needed to restore the urban
    watershed, so that sediment does not continue to impact the system or
    Lake Natoma, and provide increased security against water quality
    degradation by contamination from urban uses.
        The City proposed that the U.S. Army Corps of Engineers continue
    technical, planning and design assistance on a Section 503 Watershed
    restoration project for the city's storm drainage system for urban
    watershed restoration and water quality-related improvements. The City
    is prepared to cost-share work on this project, consistent with the
    authorization.
                                     ______

       Prepared Statement of Mayor George Pettygrove, City of Fairfield,
                                   California
                      section 205--ledgewood creek project
        Thank you, Mr. Chairman, and members of the committee for this
    opportunity to speak before you today in support of the City of
    Fairfield's Ledgewood Creek project. The City of Fairfield appreciates
    this committee's continuing support for our flood control efforts over
    the years, and we look forward to working with the committee to
    continue to improve our flood control infrastructure.
        The City requests that this committee provide an earmark of
    $400,000 for the continuation of the Section 205 Ledgewood Creek
    Project. This project received $300,000 in funding for fiscal year
    1999.
        When the U.S. Army Corps of Engineers studied Ledgewood Creek in
    preparation for design of the Fairfield Vicinity Streams Project
    improvements, the Corps predicted that Ledgewood Creek could bifurcate
    and flood Interstate 80 (I-80). On February 3, 1998, the prediction
    came true. Run-off from the Ledgewood Creek drainage basin could not be
    contained within the unimproved creek channel and the creek overflowed.
    From approximately 7:45 a.m. until 12:45 p.m. (roughly five hours), all
    four westbound lanes of I-80 were closed. Within an hour after the
    closure, a logjam of cars backed up over 15 miles. Three of the four
    eastbound lanes were also closed for a portion of the morning due to
    the flooding. In addition to preventing flooding in I-80, the
    improvement of Ledgewood Creek from Abernathy Road to the Fairfield
    city limits will remove approximately 300 acres of residential,
    commercial, and industrial property from the FEMA AO flood zone.
        The City of Fairfield appreciates the committee's continuing
    assistance on the Ledgewood Creek project. As you know, our city is one
    of the fastest growing communities in California. Fairfield's
    population continues to grow rapidly, and we continue to attract major
    corporate and industrial development. Fairfield faces new and difficult
    flood control challenges. Your assistance is greatly appreciated on all
    of these projects. Thank you.
                                     ______

      Prepared Statement of Mayor Steve Miklos, City of Folsom, California
                     highway 50 pond study and remediation
        Thank you, Mr. Chairman, and members of the committee for this
    opportunity to speak before you today in support of the City of
    Folsom's request for a $100,000 earmark for the Bureau of Reclamation
    to study and remediate the possibly dangerous situation at the Highway
    50 Lake Natoma Pond.
        Lake Natoma, created by Nimbus Dam and a part of the American River
    Watershed, is located at Folsom, California. The southern shoreline of
    the lake crosses beneath Highway 50 and creates a small ``pond'' south
    of the highway. This ``pond'' is actually a relatively still backwater
    of the lake and apparently suffers from very poor circulation. The
    Highway 50 pond is in full view of all traffic on the highway and is an
    unsightly introduction to the Folsom community for residents and
    visitors. Scum, floating trash and other debris are constantly present
    on the surface of the water. Further, the pond's status with respect to
    contaminants, disease, and other water quality threats to both Lake
    Natoma and the American River are unknown at this time.
        This project will provide funding to the Bureau of Reclamation for
    purposes of investigating the current status of the pond area, causes
    of the apparent contamination of the pond, and identifying and
    undertaking remedial work. Without this earmark, it is likely that the
    pond will continue in its current state or further deteriorate, with
    unknown effects on Lake Natoma and the American River. I should also
    point out that the Nimbus Fish Hatchery, the main hatchery on the Lower
    American River, is located less than a half mile downstream from this
    obviously contaminated pond.
        Mr. Chairman, thank you again for the opportunity to testify
    regarding the City of Folsom's three important projects before your
    committee, and I request that the committee view favorably this very
    important project.
                                     ______

    Prepared Statement of Karan Mackey, Chair, Board of Supervisors, County
                              of Lake, California
        Mr. Chairman and Members of the Subcommittee: My name is Karan
    Mackey, and I am the Chairperson of the Board of Supervisors in Lake
    County, California. I appreciate this opportunity to present to the
    Energy and Water Development Subcommittee an urgent request for federal
    assistance.
        The County of Lake requests $2,000,000 in fiscal year 2000 to
    construct the next phase of the Clear Lake Basin 2000 project, a
    Section 206 Aquatic Ecosystem Restoration project. Clear Lake in Lake
    County experiences serious water quality problems as a result of both
    sewage and sediment discharge directly into the Lake. Phase II of Basin
    2000 will improve the quality of water flowing into Clear Lake, Cache
    Creek-the only outlet for Clear Lake-and, ultimately, the Sacramento
    River and the delicate Bay-Delta ecosystem.
        Lake County has designed and partially implemented the Clear Lake
    Basin 2000 Initiative. Basin 2000 is a multi-phased watershed
    restoration effort that recycles wastewater effluent to create wildlife
    habitat, improve Clear Lake's water quality, and generate geothermal
    power. The initiative's first phase became operational in 1997.
        Lake County has completed has completed a Section 503 Watershed
    study, include all planning and design work for development of a series
    wetland sites that will cleanse the water flowing into Clear lake and
    completely eliminate the discharge of sewage into the Lake. The
    requested $2,000,000 will begin construction of 300 acres of wetlands
    out of the 1,000 acres ultimately planned for the project, a wetlands
    effluent pipeline, and flow control facility to feed water into the
    wetlands.
        With the completion of Phase II, the Clear lake basin 2000
    Initiative offers the following benefits: restores 20 percent of the
    watershed's lost wetlands; eliminates the last potential wastewater
    discharge to the Sacramento River, protects local ratepayers from
    quadrupling of rates that would be needed without wetlands recycling;
    provides multiple environmental and economic benefits from recycling
    that would be lost if traditional disposal methods were used instead;
    and insures compliance with a state-ordered deadline for a new disposal
    method.
        Lake County received funding from the Corps in the last two fiscal
    years to complete a Section 503 Watershed Study and initiate a Section
    206 Aquatic Ecosystem Restoration Project to improve the water quality
    of Clear Lake. The County contributed significantly to this process,
    funding much of the engineering and design work with non-federal
    monies. The Corps of Engineers Preliminary Restoration Plan (PRP) for
    this restoration project will be completed shortly; the final PRP is
    expected to follow approximately two months later. Construction could
    proceed in September 1999 and be in ``full swing'' next Spring.
        The total cost of Phase II is $36,100,000. Seventy-five percent of
    the funding will come from Lake County, State partners and non-
    governmental partners. The other 25 percent will come from federal
    funds through EPA and the Corps of Engineers. Lake County urgently
    needs a federal commitment in fiscal year 2000 of $2,000,000.
        Communities in Lake County, represented by Congressman Mike
    Thompson, and communities in Yolo County, represented by Congressman
    Doug Ose, will directly benefit from federal funding for Phase II of
    the Basin 2000 Initiative. Cache Creek is mostly in Yolo County and it
    receives the benefits of treated effluent because situated downstream
    of the constructed pipeline that was the successful result of Phase I.
        I thank the Subcommittee for its attention to this urgent request.
                                     ______

     Prepared Statement of Tom Hollingsworth, Mayor, City of Rancho Palos
                               Verdes, California
        As your distinguished Subcommittee writes the fiscal year 2000
    Energy and Water Resources Appropriations bill, I would like to bring a
    very important environmental restoration project to your attention.
        The Corps of Engineers and the City of Rancho Palos Verdes have
    been working on a cost-sharing feasibility study to investigate Federal
    improvements to restore pristine environmental areas along the Pacific
    coastline since 1995. The President's fiscal year 2000 Budget Request
    does not contain enough money to perform both pre-construction design
    and modeling tasks.
        I would like to take this opportunity to request that your
    distinguished Subcommittee include $400,000 in the fiscal year 2000
    Budget Request for the continuation of the pre-construction engineering
    and design. The addition of $200,000 to the proposed budget will allow
    the modeling to take place in conjunction with preliminary engineering.
    The City of Rancho Palos Verdes is prepared to commit their portion of
    the cost-share to complete the study next year.
        The area along the Rancho Palos Verdes coastline that is being
    studied has been severely degraded as a result of landslide movement of
    material and coastal erosion causing sediment and continuous turbidity
    that has buried sensitive habitat. The study involves investigations to
    define landslide and erosion relationships, impacts on the environment
    and potential restoration benefits. This project should be considered
    as essential mitigation for large local port projects.
        Thank you for the opportunity to submit this request.
                                     ______

       Prepared Statement of Richard Akin, Supervisor, County of Sutter,
                                   California
       fiscal year 2000 energy & water appropriations sutter basin study
        Thank you, Mr. Chairman, and members of the committee for this
    opportunity to speak before you today in support of the Sutter Basin
    Study. The County of Sutter appreciates this committee's continuing
    support for our flood control efforts over the years, and we look
    forward to working with the committee to continue to improve our flood
    control infrastructure.
        The County of Sutter requests a $300,000 earmark in the fiscal year
    2000 Energy & Water Appropriations bill to proceed with the Army Corps
    of Engineer's General Investigation Reconnaissance Study for the Sutter
    Basin in Sutter County, California.
        Between the west bank of the Feather River, the Sutter Bypass, and
    the east bank of the Sacramento River, Sutter County contains
    approximately 220 miles of floodwater retaining levees. The County has
    repeatedly sustained damages due to flooding. This area has a long
    history of flooding which supports the perception that a serious threat
    to lives and property exists. The County's economy is depressed, at
    least party due to the reluctance of businesses to locate in an area
    they perceive to be prone to flooding.
        The US Army Corps of Engineers is currently conducting a General
    Investigation Reconnaissance Study for the Sutter Basin in Sutter
    County, California, for which Congress provided $100,000 in the fiscal
    year 1999 Energy and Water Appropriations bill. Sutter County requests
    an earmark of $300,000 in the fiscal year 2000 Energy & Water
    Appropriations bill to proceed with the Sutter Basin Feasibility Study.
    The Study is required to provide an in-depth evaluation of flood
    control capability and needs, and to identify projects needed to
    achieve a specified level of protection.
        Mr. Chairman, the County of Sutter appreciates the committee's
    continuing assistance related to flood control in our region. Thank you
    for the opportunity to appear before your committee.
                                     ______

                    NATIONWIDE WATER RESOURCE ORGANIZATIONS
             Prepared Statement of the National Waterways Alliance
        As members of the National Waterways Alliance, we appreciate the
    opportunity to submit this statement in support of adequate funding for
    the Army Corps of Engineers' civil works program. The Alliance is a
    coalition of waterway-related associations, industries, and
    organizations in the agricultural, aluminum, building materials,
    chemical, coal, fertilizer, iron and steel, paper and wood products,
    petroleum, and other sectors shipping or receiving products by water
    transportation. It also includes both shallow- and deep-draft ports,
    river valley associations, shippers, flood control interests, water
    recreation and coastal entities, electric utilities, agricultural and
    electric power cooperatives, maritime labor, dredging operators,
    shipyards and repair facilities and other waterways services, all
    serving many millions of producers, customers, and consumers across the
    country.
        As a coalition of waterways interests, we are well aware of the
    Subcommittee's strong commitment to meeting the Nation's water
    resources needs, as evidenced by the level of funding provided for
    civil works programs in the Fiscal Year 1999 Energy and Water
    Development Appropriations Act. Your commitment to a program of
    adequate investment in the waterways infrastructure is deeply
    appreciated, and we urge you to continue to invest the necessary funds
    to sustain waterways programs in a realistic, responsible manner.
        We are concerned, however, with the lack of necessary support for
    civil works evidenced in the President's fiscal year 2000 budget
    request. The great stride forward taken by your Subcommittee last year
    in providing a more reasonable funding level would be erased should the
    fiscal year 2000 budget request be adopted. The proposed level of
    funding of $3.9 billion assumes collection of some $950 million from
    the still-to-be-submitted Harbor Services Fund proposal. This is a
    budgetary gimmick relying upon a legislative measure yet to be
    revealed--a dangerous assumption that poses a substantial threat to
    fulfillment of civil works missions.
                 an imbalanced fiscal year 2000 budget request
        Most of the increase in the fiscal year 2000 budget request is
    earmarked for deep-draft port maintenance and construction, which is
    dependent upon revenue to be transferred from the Harbor Maintenance
    Trust Fund, contingent upon enactment of the proposed Harbor Services
    Fee. Other civil works missions, principally inland navigation and
    flood control, are funded at roughly two-thirds of what is needed for
    efficient program operation.
        The level of funding requested for civil works activities would
    endanger our ability to continue an effective waterborne transportation
    system. The construction program, for instance, is funded at $1.239
    billion, which is some $200 million below fiscal year 1999
    appropriations. This downward trend in spending would stretch out
    construction schedules, adding to project costs and delaying the
    realization of project benefits, and also increase the already
    substantial backlog of necessary rehabilitation. Lack of a modern,
    first-class navigation system already places agricultural producers,
    miners, and forestry workers, among others, at risk of losing global
    markets. Although budgeted at a higher level, the operations and
    maintenance program is still underfunded, with a backlog of at least
    $1.5 billion in deferred maintenance. Also, many worthy flood control
    projects would see reductions in funding or simply cease to be funded,
    a dangerous gamble with billions of dollars of potential damages.
        Of additional concern is the general investigations category, the
    vehicle through which new projects are considered and studied. The
    President's budget request reduces this category by $20 million from
    last year's appropriated level and only recommends one new
    reconnaissance study. In testimony before the Senate Appropriations
    Subcommittee on Energy and Water Development, Administration witnesses
    stated that the Army Corps of Engineers had recommended 90 new starts
    in the general investigations category! Without this critical step,
    many meritorious new projects may never be considered.
                         realistic civil works funding
        Waterways-related industries strongly support a more realistic
    funding level of $4.7 billion for civil works activities in fiscal year
    2000. This level would continue the progress made by this Subcommittee
    in its fiscal year 1998 and fiscal year 1999 appropriations and allow
    the Army Corps of Engineers to honor its commitments to local
    communities, ports and harbors, inland navigation and other water
    resources interests. Most of these demands are imposed by legislation
    and by cost-sharing commitments with non-Federal sponsors. Further, a
    $4.7 billion program can be fully justified as a prudent investment in
    helping the Corps of Engineers to maintain navigation, prevent floods,
    ensure dependable water supplies, facilitate water recreation, promote
    environmental restoration and meet other program needs.
        Adequate investment in civil works programs positively impacts the
    country's economic development and global competitiveness. The U.S.
    waterways system includes 1,500 miles of deep-draft channels with 300
    ports capable of handling ocean-going vessels along the Atlantic, Gulf,
    and Pacific Coasts as well as the Great Lakes. In addition, the inland
    waterways consist of 12,000 miles of mainstem navigable waterways. This
    vast network of shallow-and deep-draft navigation channels provides a
    reliable and efficient water transportation system that, in 1997,
    carried 2.3 billion tons of domestic and foreign commerce including 60
    percent of U.S. grain exports, 23 percent of chemical movements, and 20
    percent of coal shipments. These and other commodities that move on the
    waterways are the building blocks of our economy. Water transportation
    supports the economies of many regions of the country and keeps U.S.
    products competitive in international markets.
        Also, in the last half-century, Corps of Engineers' flood control
    projects have prevented nearly $500 billion in river and coastal
    damages. In 1997 alone, these projects saved an estimated $45.2 billion
    in flood damages. The investment made by Congress in these programs has
    been critical in protecting life and property. The civil works program
    also funds over 4,000 water recreation sites as well as coastal
    protection programs, bank stabilization, hydropower, and municipal and
    industrial water supply.
        We respectfully urge you, therefore, to consider the diverse public
    benefits of civil works programs and the tremendous return on Federal
    investments that they provide. We request that you allocate sufficient
    funds to meet civil works needs as we prepare to enter the next
    millennium. In the case of waterways programs, adequate investment now
    will be a much lower price to pay than dealing with the consequences
    later of delaying needed maintenance and modernization.
        We thank the Subcommittee for the opportunity to submit this
    statement, which we hope you will consider in marking up your fiscal
    year 2000 bill.
                                     ______

           Prepared Statement of the American Farm Bureau Federation
        The American Farm Bureau Federation appreciates the opportunity to
    submit this statement in support of adequate funding for the Army Corps
    of Engineers civil works program. The American Farm Bureau Federation
    is the nation's largest general interest organization for farmers and
    ranchers. American Farm Bureau represents 4.9 million Farm Bureau
    families in all 50 states and Puerto Rico. Farm Bureau's members grow
    all commercially produced agricultural commodities cultivated in the
    United States.
        Farm Bureau compliments the Subcommittee on its strong commitment
    to meeting the nation's water resources needs, as evidenced by the
    level of funding provided for civil works programs in the Fiscal Year
    1999 Energy and Water Development Appropriations Act. Farm Bureau and
    its members appreciate the Subcommittee's commitment to a program of
    adequate investment in the waterway infrastructure. We urge you to
    continue to invest the necessary funds to sustain waterways programs in
    a reasonable manner.
        Farm Bureau is concerned by the lack of commitment to civil works
    demonstrated in the administration's fiscal year 2000 budget request.
    The Subcommittee's effort to provide adequate funding for civil works
    last year would be lost should the fiscal year 2000 budget request be
    adopted. The proposed level of funding of $3.9 billion assumes
    collection of some $950 million from the as yet undefined Harbor
    Services Fund proposal. Relying upon this $950 million assumption is
    dangerous and poses a substantial threat to fulfillment of civil works
    programs.
        Most of the increase in the fiscal year 2000 budget request is
    earmarked for deep-draft port maintenance and construction, which is
    dependent upon revenue to be transferred from the Harbor Maintenance
    Trust Fund which itself is contingent upon enactment of the proposed
    Harbor Services Fund. Other civil works missions, principally inland
    navigation and flood control, are funded at roughly two-thirds of what
    is needed for efficient program operation.
        One of the most important things Congress can do to help farmers is
    to provide a low-cost, efficient transportation infrastructure. An
    important part of that infrastructure was initially created decades ago
    with the inland waterways transportation system, featuring a series of
    locks and dams on the Mississippi between Minneapolis-St. Paul and St.
    Louis.
        The inland waterway system is absolutely critical to American
    agriculture. About \1/3\ of American agricultural production is
    exported; about 60 percent of those exports move down the Mississippi
    River system to our ports on the Gulf of Mexico. As these barges return
    upriver, they often bring agricultural inputs like fertilizers into the
    interior regions of the Midwest. This barge traffic has been estimated
    by Price Waterhouse to support between 300,000 and 450,000 jobs in the
    ten-state region of the Mississippi River Valley. These jobs generate
    about $4 billion in income.
        For farmers in midwestern states, the ability to use the river to
    transport what they produce is critically important. Farmers in
    Minnesota shipped an average of 195 million bushels of corn, 64 million
    bushels of soybeans, and 26 million bushels of wheat on the Minnesota
    and Mississippi Rivers every year during the 1990's. This is equivalent
    to \1/4\ of the total corn crop grown in Minnesota, and these corn
    shipments were worth over $470 million in 1997. In other Midwestern
    states, river transportation is as important as it is to Minnesota, or
    more so. Missouri farmers shipped an average of 52 million bushels of
    corn, 30 million bushels of soybeans, and 42 million bushels of wheat
    annually in the 1990's. Iowa farmers shipped an average of 203 million
    bushels of corn annually, and 66 million bushels of soybeans annually
    on the Mississippi River system in the 1990's. Illinois farmers shipped
    a whopping 591 million bushels of corn (about \1/3\ of the state's
    total corn crop), 170 million bushels of soybeans, and 26 million
    bushels of wheat on the Mississippi and Illinois rivers annually in the
    1990's. Clearly, the Mississippi, Missouri, Minnesota, and Illinois
    Rivers are key transportation arteries that carry the massive
    agricultural production of the Midwestern states to their export
    markets.
        Unfortunately, as the system ages, it is increasingly taxed and is
    less able to meet the demands placed on it. Many of these facilities
    are 60 years old and are inadequate to meet modern navigation needs.
    Many of these locks are only 600 feet long, when the average tow in use
    today is 1,100 feet long, inclusive of barges and towboat. You can
    imagine the back-ups that often occur during peak shipping seasons as
    each tow must stop, be broken into two parts, pushed separately through
    the lock, and reassembled on the other side. This is a process that
    takes about ninety minutes for each tow; this creates delays that cost
    the entire economy money and reduces the per-bushel price farmers earn
    for their produce. This congestion is costing our economy millions of
    dollars annually in lost time and productively that a comparatively
    small federal investment in improved infrastructure could recover.
        River congestion on the Mississippi equals lost income to farmers
    who can't afford to forgo any income with commodity prices so low.
    Inefficient water transportation will result in further lost export
    market share for U.S.-grown grains and less income for farmers.
    Preliminary results from a Texas A&M study indicates that producers
    could lose between $100 million and $150 million a year if bottlenecks
    on the Mississippi continue to reduce the efficiency of our inland
    waterway system.
        At Farm Bureau, we believe that farmers are the first
    environmentalists because we depend on the land to earn a living. There
    will also be environmental benefits to improving the navigation
    infrastructure on the Mississippi and Illinois Rivers. Moving bulk
    freight is the most efficient and safest means available. The movement
    of 100 million tons of bulk commodities on the Mississippi River system
    (an average year's bulk freight on the rivers now) keeps 1 million rail
    cars or 4 million trucks available for other movements of grains or
    other commodities and keeps these rail cars and trucks off the roads
    and away from road crossings in rural communities, according to the
    Iowa Department of Transportation. The U.S. Environmental Protection
    Agency laboratory tells us that towboats emit 35-60 percent fewer
    pollutants than railroad locomotives or trucks. According to the U.S.
    Department of Transportation, a gallon of fuel in a towboat can carry a
    ton of freight 2.5 times farther than rail and 9 times farther than a
    truck. The U.S. Army Corps of Engineers recently suggested that
    anywhere from $100 million to $300 million is saved annually in air
    clean-up costs due to usage of the river system that might otherwise
    have to be spent if river freight had to move on other modes.
        Farm Bureau policy #117 (Waterways), as approved by the AFBF's
    voting delegate body at the Farm Bureau convention in January 1999
    says, in part:

              Public policy should encourage expansion of inland water
            transportation since it represents the most efficient mode--We
            encourage a Midwestern, multi-state effort to review results of
            existing river and related studies and identify impacts of
            associated state and federal regulation. Based on that review,
            we will propose a multiple-use strategy for the Upper
            Mississippi River and its tributaries that serves agriculture,
            industry, transportation, and the environment--We support the
            Corps' (of Engineers) efforts in updating locks and dams and
            cleaning of channels in the Mississippi River system to
            accommodate new, larger barges.

        Farm Bureau requests that Congress increase the appropriation for
    the Army Corps of Engineers in fiscal year 2000 for improvements for
    the Mississippi River system. This appropriations increase should
    include $9 million in additional funds to conduct pre-engineering and
    design studies for lock chamber extensions and guide wall extensions
    for Locks 25, 24, 22, and 21 on the Mississippi and the LaGrange and
    Peoria locks on the Illinois River; $5 million to meet dredging
    shortfalls on the Upper Mississippi and Illinois Waterways, and $17
    million in funding for major maintenance on the Mississippi River
    system.
        The level of funding requested for civil works activities would
    endanger our ability to continue an effective waterborne transportation
    system. The President's request would fund construction program is
    funded at $1.239 billion, $200 million less than the fiscal year 1999
    appropriations. This downward trend in spending would stretch out
    construction schedules, adding to project costs and delaying the
    realization of project benefits, and also increase the already
    substantial backlog of necessary rehabilitation. Lack of a modern,
    first-class navigation system already places agricultural producers,
    miners, and forestry workers, among others, at risk of losing global
    markets. Also, many worthy flood control projects would see reductions
    in funding or simply cease to be funded, a dangerous gamble with
    billions of dollars of potential damages.
        The waterways industry strongly supports a more realistic funding
    level of $4.7 billion for civil works activities in fiscal year 2000.
    This level would continue the progress made by this Subcommittee in its
    fiscal year 1998 and fiscal year 1999 appropriations and allows the
    Army Corps of Engineers to honor its commitments to local communities,
    ports and harbors, navigation and other water resources interests. Most
    of these demands are imposed by legislation and by cost-sharing
    commitments with non-Federal sponsors. Further, a $4.7 billion program
    can be fully justified as a prudent investment in helping the Corps of
    Engineers to maintain navigation, prevent floods, ensure dependable
    water supplies, facilitate water recreation, promote environmental
    restoration and meet other program needs.
        Adequate investment in civil works programs positively impacts the
    country's economic development and global competitiveness. The U.S.
    inland waterways system includes 1,500 miles of deep-draft channels
    with 300 ports capable of handling ocean-going vessels along the
    Atlantic, Gulf, and Pacific Coasts as well as the Great Lakes. In
    addition, the inland waterway system consists of 12,000 miles of
    mainstem navigable waterways. This vast system provides a reliable and
    efficient water transportation system that, in 1997, carried 2.3
    billion tons of domestic and foreign commerce including 60 percent of
    U.S. grain exports, 23 percent of chemical movements, and 20 percent of
    coal shipments. These and other commodities that move on the waterways
    are the building blocks of our economy. Water transportation keeps U.S.
    products competitive in international markets and supports the
    economies of many regions of the country.
        We respectfully urge you, therefore, to consider the many public
    benefits of civil works programs and the tremendous return on federal
    investments that they provide. We request that you allocate sufficient
    funds to meet civil works needs as we prepare to enter the next
    millennium. In the case of waterways programs, adequate investment now
    will be a much lower price to pay than dealing with the consequences
    later of delaying needed maintenance and modernization.
                                     ______

      Prepared Statement of W. Ron Allen, President, National Congress of
                                American Indians
                                  introduction
        Chairman Domenici, Vice-Chairman Reid and distinguished members of
    the Appropriations Subcommittee on Energy and Water Development. Thank
    you for the opportunity to present this statement regarding the
    President's Budget Request for fiscal year 2000 Indian programs and
    services specifically in the Department of Energy. My name is W. Ron
    Allen. I am President of the National Congress of American Indians
    (NCAI) and Chairman of the Jamestown S'Klallam Tribe located in
    Washington State.
        NCAI views the fiscal year 2000 federal budget process as an
    opportunity to begin to set a better course for federal Indian
    policymaking in the next century. Tribal governments have found
    themselves in an increasingly defensive posture in the development of
    federal Indian policy over the last four years, and budget cuts and
    budget riders have been the point of attack on tribal self-
    determination.
        Tribal leaders have set as an important goal that the tribal budget
    must become a higher priority within the appropriations process. The
    federal government has treaty and trust obligations to support Indian
    tribes that it is simply not meeting. Also, tribal citizens pay federal
    taxes but receive little support from federal funds that go to states.
    Programs serving the American Indian and Alaska Native population have
    rarely received the federal funding required to fulfill even the most
    basic needs and funding for Indian programs has lagged far behind the
    funding of non-Indian programs. Compared to all other sectors of the
    American populace, American Indians and Alaska Natives most often rank
    at or near the bottom or top of most social and economic indicators,
    whichever is worse. Of the 558 federally-recognized Indian tribes, a
    great majority of their populations are characterized by the most
    severe unemployment, poverty rates, ill-health, poor nutrition and sub-
    standard housing in the U.S. In an era of federal budget surpluses,
    there are no excuses for failing to meet the federal obligation to
    remedy the human tragedy behind the statistics.
        The solution for the poor conditions in Indian Country must be a
    reinvigorated approach to economic development. The federal budget for
    fiscal year 2000 can do much to build the necessary infrastructure of
    roads, schools, housing, child and elder care, hospitals, clinics,
    technology, law enforcement, courts and other critical elements of any
    functioning economy in the United States. The United States has an
    obligation to help rebuild the shattered infrastructures of Indian
    Nations and create the opportunity for economic prosperity that will
    benefit not only Indian people, but the entire American economy. It
    should also be noted that the conversion of welfare entitlement funds
    into state discretionary funding has added to the urgency felt
    throughout Indian Country to boost economic development.
        Also, the use of appropriations riders to ambush tribal self-
    government has become more and more frequent. Tribal self-government is
    recognized in the United States Constitution and hundreds of treaties,
    federal statutes and Supreme Court cases and is deserving of serious
    consideration by the Congress. At the very least, if the federal
    government is going to contemplate legislation affecting tribal self-
    government, the legislation should be considered in the authorizing
    Committees, given opportunity for consultation with the affected
    tribes, and taken up as stand-alone legislation where Members of
    Congress can know and understand what they are voting on. We have been
    made aware of the introduction of Senate Resolution 8 by Senators Ted
    Stevens and Robert Byrd. S. Res. 8 would amend the Senate rules to
    reinstate a former rule which prohibited legislative riders on
    appropriations bills and which would require a three-fifths vote to
    waive a point of order under the rule. NCAI would surge the members of
    this Sub-committee to support S. Res. 8.
        As Congress begins to shape the fiscal year 2000 budget, the NCAI
    urges an increased investment in Indian programs and tribal government
    infrastructure. We believe that the President's fiscal year 2000 budget
    request has taken a very positive step in that direction. The following
    testimony is an overview of the recently released President's fiscal
    year 2000 budget request that provides NCAI's viewpoint on sections of
    the budget that are most critical to tribal governments.
                             background information
        Mr. Chairman, I would like to begin my testimony by providing a
    general context regarding federal funding for Indian programs.
    Unfortunately it has been a rare occasion indeed, if ever, that
    programs serving the American Indian and Alaska Native population have
    received the federal funding required to fulfill even the most basic
    needs of tribal members. Of the 558 federally-recognized Indian tribes,
    a great majority of our populations are characterized by severe
    unemployment, high poverty rates, ill-health, poor nutrition and sub-
    standard housing. Historically, funding for Indian programs has lagged
    far behind the funding of many non-Indian programs and this gap only
    continues to grow.
        Compared to all other sectors of the American populace, American
    Indians and Alaska Natives most often rank at or near the bottom or top
    of most social and economic indicators, whichever is worse. When
    comparing trends between fiscal year 1975-1999 for the total BIA budget
    and the federal non-defense budget as a whole, federal spending as a
    whole increased at a rate of $41 billion a year, with an average level
    of $669.8 billion, while when corrected for inflation, the BIA budget
    actually declined by $10 million a year, on an average spending level
    of $1.7 billion. Throughout the entire fiscal year 1975-fiscal year
    1999 period, per capita spending on the U.S. population as a whole
    consistently increased, whereas per capita spending on Indians through
    major Indian-related programs began to fall after fiscal year 1979.
        Furthermore, in fiscal year 1996, federal funding for Indian
    programs fell short 13 percent or $581 million from the President's
    budget request for that fiscal year. This was mostly seen in dramatic
    cuts in funding for the BIA ($322 million less), Department of Housing
    and Urban Development (HUD) New Indian Housing ($134 million less), and
    the Indian Health Service (IHS) ($80 million less). In fiscal year
    1997, funding for these programs fell short 4.1 percent or $175 million
    below the President's request. And in fiscal year 1998, there was a 1.2
    percent or $52 million shortfall from what the President requested. In
    fiscal year 1999, this unfortunate trend continued with a $100 million
    shortfall.\1\ Mr. Chairman, in a year when the U.S. economy is booming
    and the federal government is expecting over seventy billion dollars in
    surplus funds, the federal government should not be cutting funds to
    American Indians, this nation's poorest people.
    ---------------------------------------------------------------------------
        \1\ See generally ``Indian-Related Federal Spending Trends. FY
    1975-1999'', Congressional Research Service (CRS), February 1998.
    ---------------------------------------------------------------------------
        As you are well aware, in recent years tribes have faced
    extraordinary challenges throughout the appropriations process.
    Unprecedented reductions in federal Indian program funding left many
    tribes facing extreme circumstances. Non-funding ``riders'' attached to
    Interior Appropriations bills reached well past the scope of the
    appropriations process and were interpreted by Indian Country as an
    attempt to diminish tribal sovereignty and change the basic fabric of
    the federal-tribal relationship. While we appreciate the commitment to
    balance the federal budget and reform the welfare system, we maintain
    that such laudable initiatives do not and should not preclude the
    federal government from fulfilling its trust responsibilities to Indian
    tribes throughout this great nation. In short Mr. Chairman,
    extraordinary budget reductions in federal Indian programs have created
    a state of emergency for many tribal governments. NCAI is encouraged,
    however, with the Administration's fiscal year 2000 commitment to begin
    addressing some areas of priority concern to Indian Country.
        As Congress begins the appropriations process for fiscal year 2000,
    NCAI aggressively seeks support from this Subcommittee in reversing the
    decline in funding for federal Indian programs that we have experienced
    since fiscal year 1996. In general, we believe that the President's
    fiscal year 2000 budget request has taken a very positive step in this
    direction. We are concerned, however, that even the Administration's
    request for certain essential tribal programs and services remain
    seriously inadequate. Accordingly, tribal budgets are insufficient to
    meet the most basic needs of tribal populations.
        The following testimony is an overview of the recently released
    President's fiscal year 2000 budget request that provides NCAI's
    viewpoint on sections of the budget under the Department of Agriculture
    that are most critical to tribal governments. As more specific
    information is released from the Administration regarding the details
    of the budget request, NCAI will provide further information regarding
    the priorities of the tribal government members of NCAI.
                              department of energy
        The Department of Energy (DOE) manages programs to mitigate and
    remediate Indian lands including ceded and former Indian lands
    contaminated by the Cold War legacy. Inadequate funding is detrimental
    to programs that institute: tribal involvement in decision-making
    processes; shipping of high and low level radioactive waste through
    Indian Country (whose jurisdictions do not have adequate emergency
    response programs in place to protect people, lands and resources);
    and, the siting of permanent repositories for spent nuclear waste on
    former traditional lands (under an arbitrary policy which inequitably
    supports non-Indian state and county governments for oversight
    activities, but does not involve tribes in geographical proximity and
    indigenous to the area).
        The Nevada Test Site is within the traditional homelands of the
    Shoshone and Paiute peoples whose culture, environment, and health has
    been already impacted by federal government-sponsored atomic testing
    and other activities. The DOE Office of Civilian Radioactive Waste
    Management (OCRWM) has performed scientific and technical studies at
    Yucca Mountain on the Nevada Test Site for a proposed high-level spent
    nuclear fuel and radioactive waste permanent repository. The 16-year
    compilation of the Yucca Mountain study, the Yucca Mountain Viability
    Assessment, was released in December 1998. However, the Indian nations
    indigenous to the area do not have the technical staff to analyze the
    massive data.
        Last year's DOE-OCRWM budget did not provide funding for oversight
    activities for the tribes indigenous to this area. However, $16 million
    was given to the state of Nevada, nine Nevada counties, and one
    California county (designated local units of government under the
    Nuclear Waste Policy Act of 1987, as amended) for oversight activities
    at Yucca Mountain. This year, $10.2 million has been requested for non-
    Indian governments. NCAI asks that this committee end the disparate
    treatment of tribal governments by earmarking $5 million for tribal
    involvement in the Yucca Mountain area. By funding the impacted tribes,
    Congress will transform the DOE-OCRWM's arbitrary policy of ignoring
    the tribes who remain in their homelands but are left out of the
    oversight process at Yucca Mountain.
        The NCAI Nuclear Waste Program, funded through a DOE-OCRWM
    cooperative agreement, is a national information dissemination effort
    to provide tribal governments with updates on the implementation of the
    Nuclear Waste Policy Act of 1982, as amended. The long-range issues and
    impacts to Indian Country are significant and national in scope, but
    tribes do not have adequate staff or resources to track this program.
    The current NCAI Nuclear Waste Program year is the second under a
    renewed five-year cooperative agreement period. The Program budget is
    at its lowest funding level since its inception in 1982, and DOE-OCRWM
    did not request funding to continue this highly successful program and
    important link to Indian Country. In order to sustain a viable program
    to provide tribal leaders with relevant and current information and
    assist in the interactive DOE process, the NCAI requests the Congress
    to direct the DOE-OCRWM to provide annual funding to the NCAI
    cooperative agreement in the amount of $300,000 as part of its trust
    responsibility toward keeping tribes informed on programmatic impacts
    and maintaining open dialogue with impacted tribal communities.
        The NCAI is making an effort to inform tribes located near nuclear
    utilities that the DOE Office of Nuclear Energy, Science and Technology
    budget contains $10 million for research and development collaboration
    to refurbish and upgrade those nuclear utilities whose licenses will
    soon expire and will have to apply to the Nuclear Regulatory Commission
    for relicensing. This budget reflects a 44 percent increase in nuclear
    energy research and development. We request the DOE direct a portion of
    this funding to be shared with tribes within the 10-mile Emergency
    Planning Zone and the 50-mile Ingestion Pathway Zone around commercial
    nuclear reactors.
        Under the DOE Office of Environmental Management Office of Public
    Accountability (EM-22), ten tribes have cooperative agreements to
    participate in site cleanup and waste management oversight activities.
    The DOE-EM program fiscal year 2000 budget request does not provide an
    increase for critical tribal program continuity. Adequate tribal
    program funding always has been a problem, despite the fact many
    federal sites slated for cleanup are former tribal lands or ceded
    territory and contain significant cultural sites. DOE-EM officials have
    suggested they are working to avoid negative impacts on tribal budgets,
    however their budget does not reflect this assertion. We request the
    Congress provide increased tribal funding for a total of $6 million for
    the cooperative agreements so as not to undermine tribal cleanup
    programs, and to provide funding for Indian outreach by organizations
    including NCAI.
        Funding for the Waste Isolation Pilot Project comes primarily
    through DOE-EM. We are aware that DOE-EM has lowered funding allocation
    for emergency preparedness, public information, and accident prevention
    activities in the fiscal year 2000 budget. The tribes on the WIPP
    transportation corridor in the designated corridors do not have
    adequate emergency response capability in the event of a radiological
    transportation accident. Emergency response organizations require
    several years to develop. In the interest of protecting tribal
    communities, NCAI requests that the DOE-EM's WIPP emergency
    preparedness funding be increased to $1 million.
        NCAI also supports funding for the following tribal programs: (1)
    Energy Efficiency & Renewable Energy--provides grants and technical
    assistance to tribes for weatherization, wind energy systems,
    hydropower, photovoltaic, and renewable energy technologies, $5
    million; (2) Fossil Energy--supports oil exploration and drilling
    research which is beneficial to tribes, $540,000; (3) Defense
    Programs--educational and scientific outreach by national laboratories,
    $750,000; (4) Economic Impact & Diversity--support for small business
    and educational grants $200,000; and, (5) Bonneville Power
    Administration--cultural resources for Pacific Northwest Tribes, $5
    million.
        Non-Indian organizations are being provided funding to conduct
    forums and policy analysis about tribal government participation and
    impacts. Tribal businesses and Indian organizations are capable of
    doing this work, probably at a more reasonable cost. We reject the
    notion that outside consulting and convener groups like Aspen and
    Keystone are receiving funding to delve into American Indian and Alaska
    Native issues while they remain largely ignorant of tribal sovereignty
    and cultural matters. We believe such funding should be made available
    to tribes and Indian organizations, such as NCAI. A tribal organization
    will also protect tribal integrity, maintain confidentiality, and
    prevent breaches of protocol. NCAI respectfully requests this committee
    recommend to the DOE the need change this outdated and unproductive
    practice of non-Indian intrusion.
                                   conclusion
        Mr. Chairman, we urge the Congress to fulfill its fiduciary duty to
    American Indians and Alaska Native people and to uphold the trust
    responsibility as well as preserve the Government-to-Government
    relationship, which includes the fulfillment of health, education and
    welfare needs of all Indian tribes in the United States. This
    responsibility should never be compromised or diminished because of any
    Congressional agenda or party platform. Tribes throughout the nation
    relinquished their lands as well as their rights to liberty and
    property in exchange for this trust responsibility. The President's
    fiscal year 2000 budget request acknowledges the fiduciary duty owed to
    tribes. We ask that Congress maintain the federal trust responsibility
    to Indian Country and continue to aid tribes on our journey toward
    self-sufficiency. This concludes my statement. Thank you for allowing
    me to present for the record, on behalf of our member tribes, the
    National Congress of American Indians' initial comments regarding the
    President's fiscal year 2000 Budget.
                                     ______

       Prepared Statement of R. Max Peterson, Executive Vice President,
            International Association of Fish and Wildlife Agencies
                          u.s. army corps of engineers
        The fiscal year 2000 budget proposal for Civil Works Appropriations
    of the U.S. Army Corps of Engineers is $4.2 billion, of which $3.9
    billion is requested in appropriated funds and $0.3 billion would be
    financed through non-Federal funds and trust fund receipts. The budget
    proposal reflects continued commitment to proper management of our
    natural resources, through dedication of $687 million to environmental
    programs (a $56 million increase over fiscal year 1999) and through
    $258 million in contributions to intergovernmental environmental
    programs. The Association appreciates the fact that many of our
    recommendations from recent fiscal years have been maintained by the
    Corps in their succeeding year's budget request.
        We continue to encourage the Corps to expedite design and grant
    administration associated with Section 1135 projects as provided for
    within the Water Resources Development Act of 1986. We urge the Corps
    to continue to take steps to expedite the approval process for those
    projects.
        The Association encourages the Corps to cooperate, coordinate, and
    develop civil works and restoration activities with State fish and
    wildlife agencies. The State fish and wildlife agencies are generally
    aware of where Corps projects could most effectively enhance the status
    of fish and wildlife resources through improvements to habitat. We are
    especially interested in the new ``Challenge 21 Initiative'' which will
    result in development of partnerships to restore riverine ecosystems to
    address flood prevention through non-structural alternatives.
        Our Association particularly appreciates the leadership of Congress
    in providing funding for mitigation projects. We are especially pleased
    that the Corps is requesting, and the Association supports, $100
    million for Columbia River Fish Mitigation in Washington. The
    Association also strongly encourages Congress to appropriate necessary
    funding within the Corps budget to facilitate the mitigation feature of
    the West Tennessee Tributaries Project, which is needed to satisfy
    legal constraints to enable initiation of river restoration work within
    this significant watershed. We recommend that the Congress explore the
    need for generic legislative direction to the Corps to ensure that the
    older projects include the authority for fish, wildlife, water quality,
    and sustained minimum flow mitigation and enhancement, and if
    legislation is necessary, to act on that need. Further, the Association
    recommends that mitigation funding for ongoing projects be listed as a
    separate line item within the Civil Works Appropriations. This action
    would separate the funds from routine operations and maintenance and
    better facilitate the separate states' ability to identify the funds
    and seek support for the projects. The Association urges the Corps to
    work with those States interested in transferring mitigation properties
    in fee simple for management by the state. Such transfers should result
    in an overall savings to the Corps.
        The Association is also generally supportive of the funding
    requested for some of the large river restoration projects. The
    Association supports the fiscal year 2000 request of $39.8 million for
    restoration of meanders and wildlife habitat on the Kissimee River and
    $75 million to restore water flows through the Everglades and other
    areas in Florida. It is in the best interest of the country to restore
    the habitat and hydrologic components of these rivers that have been
    significantly altered under previous Corps projects.
        With regard to the Corps' regulatory authority under the Clean
    Water Act of 1972, we strongly support the request of $117 million for
    implementation of a streamlined program to process, review, issue
    permits and provide an appeals procedure for the committing of
    activities in waters of the United States, including wetlands
    associated permits and jurisdictional determination.
        Furthermore, the Association believes a strong partnership program
    with state agencies affords the best opportunity for balanced
    conservation of aquatic resources.
        The Association recommends that the Corps continue in partnership
    with State fish and wildlife agencies to initiate applicable
    restoration, mitigation and conservation projects. For example, we
    request the Corps continue to participate with State agencies and non-
    Federal interests in the North American Waterfowl Management Plan
    through wetlands conservation and wetlands identification.
        The Association is excited by the potential for significant
    environmental accomplishments in restoration, conservation, and
    sustainable management of water, fish, and wildlife resources through
    the Administration's Clean Water Initiative. The Association is
    especially pleased with Federal plans to partner with local, state and
    tribal agencies and with the watershed management emphasis. The States
    are interested in forging a true partnership through sharing ideas,
    plans, design, implementation structure and enforcement in establishing
    a unified, cooperative approach to improving water quality.
                        tennessee valley authority (tva)
        The Association supports the President's budget request for TVA to
    receive $7 million in appropriations to fund operations of Land Between
    the Lakes (LBL) National Recreation Area. The LBL requested
    appropriation is the same level of funding enacted for the area in
    fiscal year 1999. Four million dollars in proceeds are expected from
    user fees and other sources for a total operating budget of
    approximately $11.0 million. LBL's operation is vitally important to
    boating, fishing, hunting, camping, wildlife observation and other
    conservation-oriented activities in the southeastern U.S.
        Other funding for traditional TVA stewardship programs will be
    attained through monies obtained by restructuring of TVA's debt. These
    programs will be paid for with power revenues using the flexibility
    provided by refinancing of the debt. No other appropriations are
    proposed for TVA.
        TVA's new approach to funding of other stewardship programs places
    these programs in a precarious position for future years. The
    Association strongly urges TVA to continue to fund these vital programs
    using power system revenues. TVA has previously utilized appropriated
    dollars to improve the quality of life in the Tennessee Valley. TVA is
    requested to keep the Association and member organizations apprised of
    significant changes in the delivery of these traditional services.
        TVA has established itself as a global leader in tailwater
    restoration and technology and has established the national standard
    for such activity. The Association commends TVA for these efforts. The
    Association also supports TVA's efforts to implement new comprehensive
    shoreline management policies and urges TVA to work closely with member
    states within the Tennessee Valley. Water level management and aquatic
    vegetation management programs remain important issues to the member
    states and we urge TVA to continue to work closely with States on these
    issues.
        The Association is concerned about the status of the navigation
    lock at Chickamauga Dam. TVA is requested to work closely with the U.S.
    Corps of Engineers to determine best construction options and
    strategies for obtaining federal funding. The Association urges
    Congress to appropriate funding to address this critical problem.
        The Association recommends that TVA continue to actively support
    and participate in the States' Clean Streams Initiative with the Office
    of Surface Mining (OSM) to complete projects in the TVA service area.
    These state-Federal-private cooperative projects are engaged in
    restoring fish, aquatic life, recreational and economic opportunity in
    watersheds damaged by acid mine drainage from past coal mining
    activities.
        We are encouraged that TVA has undertaken a serious review of
    public lands along TVA reservoirs and rivers to insure these properties
    are not utilized in such a manner as to exclude reasonable public use.
    Further, we support current and future planning efforts that insure
    conservation and protection of riparian habitat.
                  federal energy regulatory commission (ferc)
        The Association recommends Congress appropriate $7.5 million to
    allow FERC to reimburse state fish and wildlife agencies for studies
    and reviews associated with hydropower relicensing activities. Section
    1701 of the Federal Power Act was amended in 1992 specifically to
    authorize reimbursement to states for this work. FERC has never sought
    appropriated funds for this purpose. If appropriated funds cannot be
    provided, FERC should be instructed to require reimbursement for this
    work by the licensee. Otherwise, projects will be proposed for
    relicensing without adequate studies of appropriate fish and wildlife
    licensing requirements. This invites conflict and possibly more
    stringent requirements, including water releases, than would be needed
    if more adequate studies were made.
                          bureau of reclamation (bor)
        Over its 97-year history, the BOR has played a vital role in
    harnessing and managing water resources for a young and growing Western
    United States. The fulfillment of those high national priorities has
    not always been accomplished with a long-term vision for the health of
    fish and wildlife resources within BOR project design, construction and
    operational practices. Thus, the development of high priority public
    services has sometimes proven highly detrimental to other public
    values, including certain fish and wildlife resources. The agency's
    publicly stated policy is to sustain the health and integrity of
    ecosystems and protect the environment as it goes about the important
    work of providing dependable sources of water. The agency has embarked
    upon refreshing new goals that better balance these sometimes competing
    uses of limited natural resources. It is, therefore. eminently
    satisfying to the Association to witness and strongly support BOR's
    efforts to refocus considerable financial resources on ameliorating
    historical water development-related damages to fish and wildlife and
    their habitats.
        California Bay-Delta Ecosystem Restoration.--The BOR seeks $95
    million to continue this work, which has never been funded at the full
    authorization level of $143 million per year. This authorization
    expires in 2000, and the Association supports legislation extending the
    authorization to 2003 to allow for funding the entire $403 million
    authorized program. This program, which responds to Congressional
    direction through the California Bay-Delta Environmental Enhancement
    and Water Security Act, provides vital Federal cost-sharing dollars for
    ecosystem restoration in California's Bay-Delta. This effort is based
    on collaborative efforts among several federal agencies and the State
    of California. Restorative efforts such as fish screening, flood plain
    habitat restoration, instream flow provisions and watershed management,
    typify the work being accomplished. The Bay/Delta system provides
    habitat for 120 fish and wildlife species. The Association fully
    supports BOR's request for $95 million for this work for fiscal year
    2000, and would encourage Congressional extension of the authorization
    until 2003.
        Central Valley Project.--Created by Congress in the Central Valley
    Project Improvement Act, the CVP Restoration Fund is expected to
    collect just over $49 million from rate payers for fish and wildlife
    management and development work in the Central Valley Project area of
    California. The BOR is seeking a Congressional appropriation of $47.3
    million from the Fund to undertake important anadromous fisheries
    habitat work, water acquisition, fish screening and other works that
    are necessary to continue efforts to restore the fish and wildlife-
    related damages created by this federal project. The Association
    encourages the Congress to fully fund this work at the requested level
    of $47.3 million, and to make the CV Project Restoration fund a
    Permanent appropriation.
        Endangered Species Recovery Implementation.--The BOR is requesting
    a total of $15 million for endangered species recovery work spread
    among four BOR Regions. This is six percent above the 1998
    appropriation. This represents a modest increase, particularly when
    viewed in the context of the geographical areas affected by prior BOR
    activities and the complex of imperiled fish, wildlife and essential
    habitats that need attention as a consequence of these earlier actions.
    A significant proportion of the BOR's request for work in the Upper
    Colorado Region and Lower Colorado River Region is directed at
    endangered species recovery. As just one example of the important
    projects planned for fiscal year 2000, in this instance in the Upper
    Colorado, is the work on the Platte River. This multi-agency
    cooperative program is essential to restore endangered and threatened
    species and the requested $2.5 million would allow implementation
    activities such as water conservation and critical habitat restoration.
    The request for $15 million for endangered species recovery projects,
    proposed by the BOR for fiscal year 2000, is deemed essential by the
    Association and is strongly supported.
        Pacific Northwest.--As reported by the BOR, ``perhaps the region's
    largest and most visible challenge is the restoration of the anadromous
    fishery.'' The Association concurs with this assessment and strongly
    supports the request of $13.1 million for Pacific salmon recovery.
        Water Reclamation and Reuse.--As the population of the West
    continues to grow at remarkable rates, competition will continue to
    intensify among the many important uses of water. Renewable natural
    resources, including fish and wildlife, are directly dependent upon the
    availability of water. To meet citizens' demands for water and water-
    related public services, including healthy natural resources, will
    require intelligent use, conservation and reuse of the limited water
    supplies. The Association is pleased to support efforts designed to
    conserve and reuse water and supports the BOR's fiscal year 1999
    request for $31.5 million for these purposes.
                                     ______

      Prepared Statement of the Association of State Dam Safety Officials
        The Association of State Dam Safety Officials (ASDSO) strongly
    supports full funding, as authorized in the National Dam Safety Program
    Act of 1996 (Public Law 104-303), for the National Inventory of Non-
    Federal Dams in fiscal year 2000. Full funding is $500,000. This
    critical database of state- and federally-regulated dams, administered
    by the U.S. Army Corps of Engineers, has provided vital information on
    dams in the country. The timely information provided by the National
    Inventory of Dams is essential in our ongoing efforts to mitigate dam
    failures.
        ASDSO is a national organization of more than 1,600 state, federal,
    and local dam safety officials and private sector individuals dedicated
    to improving dam safety through research, education, and communication.
    ASDSO is based in Lexington, Kentucky.
        The National Inventory of Dams is one part of a continuing effort
    by federal and state dam safety officials to identify and mitigate the
    risk associated with dams and to preserve the nation's investment in
    its water control infrastructure. It is an essential tracking tool,
    which has revealed pertinent statistics on a national level while, at
    the same time, providing critical data needs to state dam safety
    regulators. The funding provides for updating, transmittal, compilation
    and distribution of information to the national database. The funding
    also gives the Corps the ability to continually upgrade the system to
    maintain its technological validity.
                                  the database
        This computer database houses vital information on federally and
    state-regulated dams across the nation. The database tracks information
    about the dam's location, size, use, type, proximity to populations,
    hazard classification, regulatory facts, and other technical data. It
    can be used by the dam safety community to access comprehensive
    statistical information and to integrate effects of dams within
    Geographic Information Systems (GIS), the state-of-the-art technology
    in tracking lifeline systems and responding to emergency events.
        The database can be used by policy makers as a tool when dam safety
    issues are under consideration. For instance, the Federal Emergency
    Management Agency uses the data to determine State Dam Safety
    Assistance Grants awarded annually under the National Dam Safety
    Program. It is essential that the National Inventory data is current to
    make equitable and accurate decisions about these grant determinations.
    Another example: data indicates that a majority of non-federal dams do
    not have emergency action plans in place something important to policy
    officials not only as it concerns dam safety, but also as it affects
    emergency preparedness. The inventory is a critical database for
    emergency managers during severe weather, earthquakes or other natural
    events that threaten dams.
        To date, detailed data on approximately 75,000 dams is housed in
    the inventory. Of this number, about 9,500 dams are termed high-hazard,
    meaning they threaten human life and could cause significant downstream
    damage should they fail. Reports generated from the Inventory have
    highlighted the fact that about 1,800 of these high-hazard structures
    are within one mile of a downstream city a statistic not known before
    the database was in place.
        The National Inventory has determined that dams are built primarily
    for recreation, flood control, irrigation, water supply, fire and farm
    ponds, mine tailings impoundment, and hydroelectric power generation.
    States regulate about 71,000 of these structures; the federal
    government owns or regulates the remaining 4,000.
                           need for continued funding
        An inventorying system, such as this one, was determined by dam
    safety administrators and federal legislators in the 1980's to be one
    of the primary objectives in a national program to improve dam safety
    in this nation. A priority which was paramount on the minds of the
    public after several devastating failures had occurred:
      --The Buffalo Creek Dam failure of 1972 killed 125 in West Virginia.
      --The Teton Dam failure in 1976 caused the deaths of 14 and $400
            million in property damage.
      --The Laurel Run Dam failure in 1977 killed 40 in Pennsylvania.
      --The Kelly Barnes Dam in Taccoa Falls, Georgia killed 39 and caused
            $2.5 million in damages in 1977.
        As a result of these disasters and the clear recognition of the
    tremendous potential for more failures, Congress passed the National
    Dam Safety Program Act of 1986 and re-authorized and updated this law
    with the National Dam Safety Program Act of 1996. Through these laws,
    Congress and has been very clear, in recent years, that it recognizes
    the need to mitigate disasters from dam failure. This recognition of
    the need for a national dam safety program, accompanied by funding,
    must continue to advance the programs now in place to reduce risks from
    dam failure.
        Although we have not seen a dam failure to match the ones mentioned
    above, failures and devastation continue to occur and still threaten
    this nation as dams continue to age and deteriorate and as downstream
    populations grow. In the past year alone, approximately 88 documented
    failures have occurred across the nation. A woman was killed in New
    Hampshire two years ago as a direct result of dam failure. Dam and
    downstream repair costs resulting from failures in 23 states reporting
    in a recent year totalled $54.3 million. Failures can affect large
    populations, may flood into neighboring states and may cost millions of
    dollars in federal disaster relief spending.
        Most failures occur at dams that are determined to be deficient or
    unsafe. There are over 1,800 unsafe non-federal dams in the United
    States including: 3 unsafe dams in New Mexico; 8 unsafe dams in Nevada;
    49 unsafe dams in West Virginia; 41 unsafe dams in Utah; and 13 unsafe
    dams in Washington.
        The priority on rehabilitating our aging and deteriorating national
    infrastructure must include dams. Dams provide people with tremendous
    everyday benefits such as drinking water, electricity, protection from
    floods, wetlands areas, recreation and irrigation.
        To measure our progress toward assuring the safety of all dams, a
    centralized, accurate database of information on dams is essential. The
    National Inventory of Dams can supply this necessary statistical data.
    But, this type of data is only as good as its last update. The database
    must be continuously updated and the system upgraded as the vital
    information on dams changes.
                                   conclusion
        In summary, the data in the National Inventory of Dams is important
    to federal and state dam regulators to have access to accurate, current
    information on dams that impact the safety of communities, other dams,
    flood prone areas and future projects. In addition, the data is
    essential to managers of the National Dam Safety Program at FEMA, who
    requires the data to make accurate and equitable determinations of
    annual state dam safety assistance grant awards. Emergency managers
    need the data in disaster mitigation and response, as do policy makers
    who constantly need to know the ``state of America's dams.'' Continual
    updating of this data is imperative to the value of the National
    Inventory of Dams.
        ASDSO strongly urges this Subcommittee to continue funding in the
    amount of $500,000 in fiscal year 2000 to the Corps of Engineers for
    the National Inventory of Dams.
                                     ______

      Prepared of Lisa S. Holland, Chair, Association of State Floodplain
                                 Managers, Inc.
        The Association of State Floodplain Managers appreciates the
    opportunity to express support for fully funding several programs of
    the Army Corps of Engineers which can significantly expand the Corps'
    ability to reduce losses due to flooding. We have found that Planning
    Assistance to States (Section 22) and Flood Plain Management Services
    provide for important elements of effective floodplain management.
    Challenge 21, the proposed Riverine Ecosystem Restoration and Flood
    Hazard Mitigation Initiative, offers new opportunities for use of non-
    structural options to achieve flood loss reduction. These are all
    elements of the Corps' activities that are especially helpful to
    communities and states around the country in reducing flood losses.
        The Association of State Floodplain Managers is an association of
    over 3,500 state and local officials and other professionals engaged in
    floodplain management, flood hazard mitigation, flood preparedness,
    warning and recovery and in working with the National Flood Insurance
    Program. Our members have expertise in the fields of engineering,
    planning, community development, hydrologic forecasting, emergency
    response, and water resources.
        The three programs we are discussing, PAS, FPMS and Challenge 21,
    are all programs which directly support the two major themes identified
    by Assistant Secretary Westphal in his testimony before the
    Subcommittee as important to the way the Corps should formulate and
    implement Civil Works policy. He said it should be based on building
    strong partnerships with states and local communities as well as other
    federal agencies. Additionally, he stated that Civil Works policy
    should help economic growth and prosperity by ``combining sound
    infrastructure management and development with environmental protection
    and ecosystem restoration''. We full support these strategies for the
    Corps.
        Under General Investigations, ``Coordination Studies With Other
    Agencies'' includes $6.5 million for Planning Assistance to States in
    the budget request for fiscal year 2000. As you know, the fiscal year
    1999 budget provided $6.3 million for this program. This amount, which
    was 1 million over the budget request, was provided by the Congress to
    help to reduce the work backlog and meet the growing need of localities
    and local and regional governmental entitles for technical assistance
    from the Corps. The Senate provided $7.5 million in recognition of the
    backlog and the $6.3 was agreed to in Conference. The situation has, of
    course, been helped by the Congressional effort this fiscal year, but a
    significant backlog remains. Further, increasing federal efforts to
    encourage cooperation and capability building among federal agencies
    and state and local governments have produced more demand for the
    Corps' guidance and assistance. We hope that the Committee will approve
    funding at least at the budget request and, hopefully, above the budget
    request.
        Also under General Investigations, Flood Plain Management Services,
    $9 million is requested for fiscal year 2000. This is the funding level
    for fiscal year ``99, although last year's budget request sought $9.4
    million. The Floodplain Management Services Program funds specific
    technical assistance requests from states, local governments and
    tribes. Generally, these address needs for identification of flood
    hazards in communities under growth pressure, assessing and taking
    steps to assure the safety of dams and providing the technical
    information to identify appropriate flood mitigation options,
    floodproofing, flood warning and hurricane evacuation studies. Without
    the technical assistance the Corps provides, structures may be built at
    risk, exposing citizens and the nation's taxpayers to future costs.
    Clearly, projects funded under FPMS work tangibly to reduce flood
    losses and costs to the federal government and support the partnership
    and economic growth/infrastructure management strategies above.
        The Corps is requesting $25 million for its Challenge 21
    initiative. While authorization is not yet in place for this promising
    program, the Senate version of this year's Water Resources Development
    Act does including authorizing language. Challenge 21 would provide the
    Corps with a full-range toolbox to help communities and states. It
    offers essential flexibility such as the ability to accommodate smaller
    projects for communities where a traditional structural project might
    not be justified or the ability to mix structural and non-structural
    elements to better design an overall project. The continuing
    authorities nature of the proposed program is important because
    confidence in a sustained federal commitment is important to
    communities for development and implementation of these smaller
    projects. It is probable that hundreds of communities in the nation
    have the potential to benefit substantially from this innovative
    initiative. We hope that the Committee will provide the nation's
    communities with the valuable tools of Challenge 21.
        It is a pleasure to share our views on the effectiveness and
    usefulness of these programs in the achievement of flood loss
    reduction. Thank you for the opportunity to present testimony. We are
    always ready to respond to your questions. Please contact ASFPM
    Executive Director, Larry Larson, at (608) 274-0123 if further
    information is needed.
                                     ______

                NEW YORK AND NEW JERSEY WATER RESOURCE PROJECTS
      Letter From Philip Beachem, Chairman, New Jersey Maritime Advisory
                                    Council
                                                        March 26, 1999.
    Hon. Pete V. Domenici,
    Chairman, Subcommittee on Energy and Water Development,
    U.S. Senate, Washington, DC.
        Dear Mr. Chairman: New Jersey relies heavily on waterfront and
    coastal commerce to maintain its healthy economy. New Jersey's deep
    draft commercial waterways handle in excess of a quarter billion tons
    of cargo a year, producing more than $1 billion in customs revenue for
    the Federal Government. In addition to our ports, New Jersey's $50
    billion maritime industry includes more than $1 billion in commercial
    and recreational fishing activities on our inland waterways and rivers.
    The continued partnership between the Corps of Engineers and the State
    of New Jersey is crucial to our local, regional, and national economy.
        Shore protection and flood control projects are equally important
    to the economy of our State and the health and safety of our citizens.
    These projects protect vital infrastructure and reduce storm damage to
    personal and public property.
        In addition to this testimony on behalf of the sixty-two corporate,
    government, and academic members of the New Jersey Maritime Advisory
    Council, we have also provided technical data for the benefit of the
    members of your Subcommittee.
        We respectfully request your favorable consideration. New Jersey is
    prepared to move resolutely ahead in partnership with the Federal
    Government.
                Respectfully submitted,
                                                Philip Beachem,
                                                              Chairman.

    SUMMARY OF THE PORT AUTHORITY OF NEW YORK NEW JERSEY FEDERAL CIVIL WORKS
                        APPROPRIATIONS, FISCAL YEAR 2000
    ------------------------------------------------------------------------
                                                President's       Sponsor
                                                  Budget      Recommendation
    ------------------------------------------------------------------------
                  CONSTRUCTION

    Kill van Kull--Newark Bay Channels, NY &     $60,000,000     $60,000,000
     NJ.....................................
    NY & NJ Channels: Arthur Kill, NY & NJ..  ..............       2,000,000
    NY & NJ Channels: Port Jersey, NJ.......       2,000,000       2,000,000
    NY Harbor Collection & Removal of Drift,  ..............       1,000,000
     NY & NJ................................
                                             -------------------------------
          Subtotal..........................      62,000,000      65,000,000
                                             ===============================
                     STUDIES

    Arthur Kill Channel Extension...........         100,000         100,000
    NY Harbor & Red Hook Flats Anchorages...         300,000         300,000
    NY & NJ Harbor Navigation Study.........         884,000         884,000
    NY & NJ Harbor Navigation Study--PED....       2,534,000       2,534,000
    NY & NJ Channels: Arthur Kill, NY & NJ..       1,312,000       1,312,000
    NY & NJ Estuary Restoration Study.......  ..............         100,000
    NY Harbor & Adjacent Channels: Claremont  ..............       1,500,000
     Channel, NJ............................
                                             -------------------------------
          Subtotal..........................       5,130,000       6,730,000
    ------------------------------------------------------------------------

      SUMMARY OF NEW JERSEY FEDERAL CIVIL WORKS APPROPRIATIONS, FISCAL YEAR
                                      2000
    ------------------------------------------------------------------------
                                                President's       Sponsor
                                                  Budget      Recommendation
    ------------------------------------------------------------------------
                  FLOOD CONTROL

    Green Brook.............................      $1,000,000      $1,000,000
    MillBrook...............................  ..............       2,200,000
    Molly Anns Brook........................  ..............       1,000,000
    Passaic River Flood Storage.............       1,800,000       1,800,000
    Passaic River Minish Park...............  ..............       8,000,000
    Poplar Brook............................  ..............         250,000
    Ramapo River-Oakland....................       1,300,000       1,300,000
    Raritan River-South River...............         569,000         569,000
    Upper Passaic-Long Hill.................         200,000         200,000
    Upper Rockaway River....................         200,000         200,000
    Woodbridge & Railway River..............         100,000         100,000
    Shrewsbury River........................  ..............         100,000
                                             -------------------------------
          Subtotal..........................       5,169,000      16,719,000
                                             ===============================
                SHORE PROTECTION

    Barnegat Bay............................         400,000         400,000
    Barnegat Inlet to Little Egg Inlet......  ..............         700,000
    Brigantine Inlet-Great Egg Inlet-Absecon  ..............      14,300,000
    Brigantine Inlet-Great Egg Inlet-         ..............         337,500
     Brigantine.............................
    Cape May Inlet to Lower Township........       1,700,000       2,000,000
    Delaware Coastline-New Jersey & Delaware  ..............         850,000
    Great Egg Inlet and Peck Beach..........         419,000         419,000
    Great Egg Inlet to Townsend Inlet.......  ..............         226,000
    Lower Cape May Meadows-Cape May Point...  ..............         523,000
    Manasquan Inlet to Barnegat Inlet.......  ..............         300,000
    Raritan Bay & Sandy Hook Bay-Cliffwood..  ..............         275,000
    Raritan Bay & Sandy Hook Bay-Highlands..  ..............         200,000
    Raritan Bay & Sandy Hook Bay-Keyport....  ..............         200,000
    Raritan Bay & Sandy Hook Bay-Leonardo...         225,000         225,000
    Raritan Bay & Sandy Hook Bay-Port         ..............         400,000
     Monmouth...............................
    Raritan Bay & Sandy Hook Bay-Union Beach         320,000         320,000
    Raritan Bay & Sandy Hook Bay-Section 934  ..............         200,000
    Sandy Hook to Barnegat Inlet............       9,000,000      18,000,000
    Townsend Inlet to Cape May Inlet........  ..............       1,250,000
                                             -------------------------------
          Subtotal..........................      12,064,000      41,125,500
                                             ===============================
                    DREDGING

    New Jersey Intracoastal Waterway                 519,000         519,000
     Environmental Restoration..............
    New York Collection & Removal of Drift..  ..............       5,500,000
    Dredging in Support of OpSail 2000......  ..............       1,000,000
                                             -------------------------------
          Subtotal..........................        519, 000       7,019,000
                                             ===============================
               PLANNING ASSISTANCE

    Section 22, Public Law 93-251...........  ..............         300,000
                                             ===============================
             OPERATION & MAINTENANCE

    Barnegat Inlet..........................       1,270,000       1,580,000
    Cold SpringInlet........................         545,000         545,000
    NJ Intracoastal Waterway................       1,854,000       1,854,000
    Salem River.............................  ..............       1,200,000
                                             -------------------------------
          Subtotal..........................       3,669,000       5,179,000
    ------------------------------------------------------------------------

     SUMMARY OF PHILADELPHIA DISTRICT CORPS OF ENGINEERS FEDERAL CIVIL WORKS
                        APPROPRIATIONS, FISCAL YEAR 2000
    ------------------------------------------------------------------------
                                                President's       Sponsor
                                                  Budget      Recommendation
    ------------------------------------------------------------------------
                     PROJECT

    Delaware River, Philadelphia to the Sea       $3,660,000      $4,160,000
     Construction & Maintenance of Disposal
     Areas..................................
    ------------------------------------------------------------------------

                                     ______

      Prepared Statement of Hon. Sharpe James, Mayor, City of Newark, New
                                     Jersey
        Mr. Chairman and members of the Subcommittee, thank you for giving
    me the opportunity to submit testimony about a project under your
    jurisdiction which is very important to the people of Newark, New
    Jersey and the surrounding region. The Passaic River Streambank
    Restoration Project, known as the Joseph G. Minish Passaic River
    Waterfront Park and Historic Area, is an important part of the overall
    economic, land use and transportation development plan of the City of
    Newark.
        The project was authorized at a level of $75 million in the 1996
    Water Resource Development Act, and has been fully planned by the Army
    Corps of Engineers. The streambank restoration and bulkhead
    replacement, which is the first phase of the overall project, is set to
    begin in the summer of 1999 two months utilizing last year's
    appropriation of $3,000,000, which also brought the project to final
    design. Prior appropriated funds have been utilized to fully design the
    bulkhead, a segment of naturalized streambank, and a system of walkways
    and public open spaces. Adjacent, currently dormant, sites will become
    desirable locations for development of commercial properties. However,
    the fiscal year 1999 funding will only take us through the construction
    of five hundred feet of bulkhead and some of the mud flats restoration,
    not to a usable facility.
        A supplemental appropriation of $15 million is requested so that
    this integral element in Newark's revitalization can move from partial
    construction to the beginning of full project build-out. This
    investment in Newark's future will help us to improve the economic
    status of our nation's third oldest major city. The development of the
    riverfront now is a critical element in the overall plan for Newark's
    downtown revitalization. This linear park will serve as a visual and
    physical linkage among several key and exciting development projects.
    It is adjacent to one of the oldest highways in the nation, Route 21,
    which is undergoing a multi-million dollar realignment and enhancement.
    A light rail system, the Newark-Elizabeth Rail Link, which will connect
    Newark's two train stations, and ultimately, Newark International
    Airport and the neighboring City of Elizabeth, will provide users with
    access to mass transportation. Conversely, the riverfront will become a
    destination served by that system, providing an important open space
    and waterfront opportunity for residents of one of the most densely
    populated cities in the nation.
        The environmental benefits of the project include flood control,
    riverbank and wetlands restoration, creation of urban green space, and
    enhancement of water quality in the Passaic River. These improvements
    will allow the Passaic River to be converted from one of the nation's
    most troubled waterways to a cultural and recreational asset. Ongoing
    and planned greenway projects will provide pedestrian and bicycle
    access to the waterfront from Newark's residential neighborhoods as
    well as the City's five major institutions of higher learning.
        The riverfront development will complement and provide a visual and
    physical connection with the new, $170 million New Jersey Performing
    Arts Center, which opened in the Fall of 1997 and has been incredibly
    successful. Further north along the riverfront, also accessible from
    the riverfront walkway when it is fully built, the City of Newark and
    Essex County are constructing a minor league baseball facility along
    Route 21, which will be open for use this July. On the eastern portion
    of Minish Park, residents of a crowded community, Newark's Ironbound,
    will have direct access to the river and its streambank for active and
    passive recreation for the first time. The development of the Passaic
    Riverfront is also a driving consideration in the planned construction
    of a major downtown sports and entertainment venue to house major
    events and competitions.
        The riverfront will be the nexus of these activities, creating a
    vibrant downtown center that will provide economic development
    opportunities for the citizens of Newark and our region. Visitors from
    throughout the nation are expected to come to visit our revitalized
    city, and participate in the exciting growth and development taking
    place. There is tremendous potential for Newark's riverfront to mirror
    the success of other riverfront developments throughout the country,
    and Newark stands ready to accept the challenges such developments
    present.
        The City of Newark currently is conducting a master plan study for
    the entire riverfront area, which will guide us in tying together these
    incredibly exciting, and challenging, projects. We have a once in a
    lifetime opportunity to coordinate several major development activities
    into a virtually seamless development plan. The appropriation of $15
    million which I am requesting will serve to incorporate the Army Corps
    of Engineers' construction into our overall economic development plan
    to reinvigorate Newark. I urge you to support this appropriation
    request.
        In closing, I would like to extend my thanks to the entire New
    Jersey delegation for its ongoing support. The time and attention of
    this subcommittee are deeply appreciated.
                                     ______

       Prepared Statement of Kevin S. Corbett, Executive Director, Port
         Authority Affairs State of New York, Empire State Development
        Corporation; Frank M. McDonough, Executive Director, New Jersey
      Maritime Resources State of New Jersey, Commerce & Economic Growth
    Commission; and Lillian C. Borrone, Director, Port Commerce Department
                  the Port Authority of New York & New Jersey
        On behalf of the Port of New York and New Jersey, we wish to thank
    you for the support you have shown for the navigation and water
    resources programs in recent years.
        Herein, we offer our comments on the US Army Corps of Engineers'
    fiscal year 2000 budget request. We fully support the proposed funding
    for the construction of the Kill van Kull-Newark Bay Channels to 45
    feet. However, we believe that funding is also required for the
    deepening of the Arthur Kill Channel to 41 feet. In order for the
    benefits of these and other projects to be realized as soon as
    possible, and to avoid unnecessary project cost increases, we request
    that the subcommittee appropriate funds at the levels described in this
    statement. These funds will ensure that essential navigation
    infrastructure will be in place to accommodate post-Panamax ships
    currently deployed in international commerce. Using a conservative
    estimate for future cargo volumes, we believe that our Port will grow
    in excess of three percent per year--which equates to cargo volumes
    doubling by 2015. Accommodating the deep draft vessels that will move
    this cargo is critical to not only the Port's vitality but also to the
    nation's commercial competitiveness. The Administration's proposal,
    enhanced by our requests for additional funds, will keep this critical
    work on track to the benefit of the regional and national businesses
    that utilize the East Coast's largest international gateway.
        Listed below are the projects and appropriation amounts that we
    request for the Port of New York and New Jersey. Those projects
    displayed in bold are our additional requests.

                                                                Port Request
    Construction:
        Kill van Kull--Newark Bay Channels, NY & NJ.........     $60,000,000
        NY & NJ Channels: Arthur Kill, NY & NJ..............       2,000,000
        NY & NJ Channels: Port Jersey, NJ...................       2,000,000
        NY Harbor Collection & Removal of Drift, NY & NJ....       1,000,000
    Studies:
        Arthur Kill Channel Extension.......................         100,000
        NY Harbor & Red Hook Anchorage......................         300,000
        NY & NJ Harbor Navigation Study.....................         884,000
        NY & NJ Harbor Navigation Study--PED................       2,534,000
        NY & NJ Channels: Arthur Kill, NY & NJ..............       1,312,000
        Flushing Bay and Creek, NY..........................         600,000
        NY & NJ Estuary Restoration Study...................         100,000
        NY Harbor & Adjacent Channels: Claremont Channel, NJ       1,500,000

        A brief description of each of these activities follows.
                                  construction
        Kill van Kull--Newark Bay Channels, NY & NJ (Phase II).--The Kill
    van Kull-Newark Bay Channels project--deepening to 45 feet--was
    authorized for construction in the fiscal year 1985 Supplemental
    Appropriations Act (Public Law 99-88) as well as the 1986 Water
    Resources Development Act (WRDA). The channel serves the busiest and
    largest container facilities on the Atlantic seaboard. The terminal
    operators and ocean carriers that call on the Port Newark and Elizabeth
    Marine Terminals, as well as the harbor pilots, have insisted that
    rapid completion of the 45 foot deepening project is essential if the
    port is to efficiently serve major carriers that call in the port. It
    is imperative to the continued navigational safety and economic
    vitality of the port region, and its ability to accommodate projected
    commerce, that the construction to 45 feet below MLW be completed as
    soon as possible. With the funding provided for fiscal year 1999 and
    the proposed funding for fiscal year 2000, the project has been given a
    good start.
        The Corps' current schedule forecasts that the project will be
    finished no earlier than 2005. The Port Authority, as local project
    sponsor, is prepared to provide the non-Federal cost-share, estimated
    at $256 million. The Port Authority is working in cooperation with the
    Corps to accomplish the project several years sooner than originally
    planned and bring the project in under its authorization level by
    providing an optimum dredged material disposal solution. We appreciate
    the Administration's second year budget for fiscal year 2000 of
    $60,000,000.
        NY & NJ Channels: Arthur Kill Channel, NY & NJ.--The Arthur Kill
    Channel, NY & NJ, Howland Hook Marine Terminal (HHMT) project was
    authorized in the 1986, 1992 and 1996 WRDA's. The project's controlling
    depth is currently 35 feet. The proposed channel improvements include:
    (1) deepening the existing 35-foot channel to 41 feet below MLW from
    its confluence with the Kill van Kull Channel to the HHMT; (2)
    deepening to 40 feet below MLW from the HHMT to the Petroport and Tosco
    facilities in New Jersey; and (3) selected widening and realignment of
    the channel to ensure safe navigation. The Port Authority has invested
    $35 million to date to modernize the HHMT and has spent, along with the
    City of New York, approximately $18 million for the berth dredging
    required to return this terminal into active service. The HHMT
    currently employs 275 people on peak days and is expected to increase
    to a range of 650 to 800 employees by the year 2000. In addition, HHMT
    is the Northeast Strategic Port of Embarkation in the event of a
    national emergency. Finally, the City, the State of New Jersey and the
    Port Authority are working to augment operations by re-establishing
    rail service to the terminal in late 1999.
        In addition to the benefits that will accrue to the HHMT and the
    petroleum facilities along the Arthur Kill, implementation of this
    deepening project is vital to the Port's future capacity to grow. The
    HHMT is the largest marine terminal in New York City and has
    significant potential for expansion. The deeper channel will not only
    improve container movement but also will enhance petroleum vessel
    transit in the harbor's waterways, minimizing lightering and reducing
    the chances of oil spills or accidental pollution of the harbor due to
    groundings. We, therefore, respectfully request that the fiscal year
    2000 appropriations include $2,000,000 to initiate channel improvements
    in the Arthur Kill Channel. We would prefer a greater amount to shorten
    the construction time frame for the 41-foot project but recognize the
    budgetary constraints you currently face.
        New York Harbor and Adjacent Channels: Port Jersey, NJ.--The 1986
    WRDA authorized construction of the Port Jersey Channel to 41 feet. The
    Port Jersey Channel, located in Bayonne, NJ, presently serves
    approximately one half dozen shipping lines calling at Global Marine
    Terminal. In addition, the channel provides access for the U.S.
    Military Ocean Terminal (MOTBY) as well as the Port Authority Auto
    Marine Terminal. MOTBY (which will remain in service under Army control
    until mid-1999 and then be turned over to the City of Bayonne except
    for a portion used by the U.S. Coast Guard) has been approved by the
    Local Re-use Authority (LRA) for a number of maritime and commercial
    re-uses, including a 125 acre plus container terminal. As the only
    privately owned terminal in the port, Global pays approximately
    $10,000,000 in Federal, state, and local taxes annually. More than 300
    vessels, carrying approximately 280,000 twenty-foot equivalent units,
    call annually upon the terminal. Well over 600 terminal employees, with
    an annual payroll of $25 million, and 3,000 indirect jobs depend on
    this facility for their livelihood. Recognizing the demand of ocean
    carriers and responding to a critical need to provide deeper water on
    an emergency basis, the State of New Jersey in 1997 constructed a 38-
    foot channel leading to Global at a cost of $10,000,000. The Federal
    cost-share for construction of this channel would have been $6,500,000,
    using the standard 65/35-project cost share formula. We support the
    Administration's request of $2,000,000 for fiscal year 2000 to initiate
    construction plans and specifications, and to implement the deepening
    and disposal required to improve the Port Jersey Channel.
        New York Harbor Collection & Removal of Drift, NY & NJ.--The Harbor
    Collection & Removal of Drift Project removes sunken hulls and
    dangerous, decaying shoreline structures, which are sources of drift,
    jeopardize the smooth and safe flow of maritime traffic, and foul the
    region's beaches. The Corps has estimated that nearly 18,000
    commercial, public and recreation vessels collide annually with harbor
    drift, causing damage to propellers, shafts and hulls. The annual
    associated repair costs and other economic losses average greater than
    $53,000,000. Ample opportunities exist for advancing this project,
    particularly within the Arthur Kill (NY/NJ), Shooters Island, NY & NJ,
    and Kill van Kull (NY) reaches. This project was authorized under the
    1988 WRDA with an annual authorization of $6,000,000. Although the
    project's benefits are primarily navigational and safety related, the
    Shooter's Island NY & NJ reach has significant environmental benefits
    for migratory birds as a rookery. We are, therefore, respectfully
    requesting a total of $1,000,000 in the fiscal year 2000 budget to
    complete design and initiate the Shooter's Island Reach.
                                    studies
        NY & NJ Channels: Arthur Kill, Extension to Perth Amboy.--The Port
    is the busiest petroleum-handling harbor in the nation. An average of
    30 billion gallons of product is transported annually. Much of this
    activity and chemical shipping activity is centered along the Arthur
    Kill. In order to adequately assess the navigation needs of the
    petroleum industry located on the lower Arthur Kill, an assessment is
    needed to evaluate channel improvements south along the Arthur Kill
    Channel below the current 41-foot project to Howland Hook Marine
    Terminal and Petroport facilities previously discussed. The State of
    New Jersey has indicated that it would support the study and provide
    the non-Federal cost share. We support the Administration's request for
    $100,000 in the fiscal year 2000 budget to complete the study.
        New York Harbor & Red Hook Anchorages, NY.--The Red Hook Anchorage
    is part of the New York Harbor and Adjacent Channels project. The
    anchorage was designed and constructed by the Corps in the early 1960's
    for ocean going cargo ships and tankers averaging 525 feet in overall
    length and with 30-foot drafts. Today, the dimensions of the anchorage
    are inadequate to accommodate modern, ocean-going vessels that are
    1,000 feet long with drafts of 40 feet or greater. Therefore, to ensure
    safe navigation and maintain the Port's capability to accommodate
    current and future vessel needs, we support the Administration's
    request for $300,000 in fiscal year 2000 to initiate a feasibility
    study for the deepening of Red Hook Anchorage. The Corps has the
    authority to undertake this study under a congressional resolution
    adopted by the Senate Committee on Environment and Public Works on
    December 5, 1980. The States of New York and New Jersey support this
    project; and they have agreed to fund the non-Federal cost equally.
        NY & NJ Harbor Navigation Study.--In the reconnaissance study,
    authorized by the 1996 WRDA, the Corps determined that evaluation of
    the channel deepening needs of the NY & NJ Harbor to 50 feet below MLW,
    or greater, is in the national interest. The States of New York and New
    Jersey and the Port Authority are the local sponsors. As part of the
    ongoing $18 million feasibility study, scheduled for completion in
    December 1999, the Corps will make recommendations for future
    navigation infrastructure improvements for the Port, in the context of
    a National Economic Development Plan. These recommendations will
    facilitate the Port's ability to continue to serve the nation's marine
    transportation needs based upon anticipated trade growth demands on
    shipping. The ocean carrier industry has made it clear that their
    future container vessels will require navigation channels dredged to
    depths that exceed the depths found currently in the Port. To complete
    the Feasibility Study, we support the Administration's request to fund
    the remaining Federal share of $884,000. Upon completion of the
    feasibility work, the Corps is prepared to enter the pre-construction
    engineering and design (PED) stage of the project. We support the
    Administration's request for $2,534,000 to initiate these activities.
        NY & NJ Channels: Arthur Kill Channel, NY & NJ.--As we noted
    earlier, the controlling depth for the Arthur Kill is 35 feet. Even as
    construction hopefully will commence in fiscal year 2000 for the 41-
    foot project, planning for an ultimate depth of 45 feet should
    continue. The 1996 WRDA authorized the project depth to as much as 45
    feet. Although new congressional authorization is needed to increase
    the Section 902 funding cap, a preconstruction, engineering and design
    effort will be needed for construction of the 45-foot channel. The
    Corps has estimated the cost of this study to be $3 million, with the
    local share provided by the State of New Jersey and Port Authority of
    New York and New Jersey. The Port supports the Administration's request
    for $1,312,000 in fiscal year 2000.
        Flushing Bay and Creek, NY.--The purpose of this study is to
    determine the feasibility of providing environmental restoration to the
    Flushing Bay and Creek project vicinity. The New York City Department
    of Environmental Protection provided a letter of support for this study
    in 1996. Funds will be used to continue the feasibility phase of the
    study that will be shared on a 50-50 percent basis by Federal and non-
    Federal interests. We support the budget request of $600,000.
        NY & NJ Estuary Restoration Project.--As part of the Harbor
    Navigation Study, investigations on upland improvements including
    terminal expansion are being conducted by The Port Authority of New
    York and New Jersey in cooperation with the States of New York and New
    Jersey and the Corps of Engineers. These activities have culminated in
    the development of a business investment plan for future port
    development and improvement. Proposed harbor improvements may include
    activities beyond construction of navigation infrastructure. For
    example, the implementation of a restoration and remediation plan for
    the New York/New Jersey Estuary is also a significant part of any
    future strategy for the harbor. To assess Federal participation in such
    a program, it is important for the Corps of Engineers to prepare a
    reconnaissance study to make a determination as to Federal interest in
    such an effort. To that end, we respectfully request that funds in the
    amount of $100,000 be appropriated for the Corps of Engineers to
    conduct the necessary assessment.
        New York Harbor and Adjacent Channels: Claremont Channel, NJ.--
    Located on the Hudson River in the State of New Jersey, Claremont
    Channel currently has an average depth of 27 feet below MLW. Section
    202(b) of the 1986 WRDA authorized federalization of the channel to 41
    feet. The State of New Jersey, the Port Authority, and the region's
    pilots have identified optimal designs for the channel, with depths
    ranging from 34 to 38 feet. This deepening project will support current
    shipping activities in the channel. Two scrap metal exporting companies
    and a crushed stone aggregate terminal are the major users of the
    Claremont Channel. Scrap metal exports have averaged over 1.5 million
    long tons per year and are our region's number one export. Meanwhile,
    crushed stone transshipments approach 4 million tons annually.
    Combined, these three firms employ 300 persons directly and provide
    nearly 3,000 indirect jobs through suppliers as well as support to
    longshore services. New Jersey will invest $21,000,000 in construction
    activities in 1999. We respectfully request that $1,500,000 be
    appropriated for fiscal year 2000 to complete the study of this
    currently inadequate channel.
                                   conclusion
        For the first time in a while, the budget request comes close to
    resembling the annual funding levels approved by Congress for deep
    draft navigation projects. The fiscal year 2000 budget for ports is of
    marked contrast to those of recent years, especially last year when the
    harbor construction budget totaled $40 million. The difference is
    partly explained by the Administration's proposal that Congress enact a
    new user fee scheme to replace the constitutionally crippled Harbor
    Maintenance Tax. Judging by the controversy surrounding the proposal
    and the difficulty Congress had in enacting the HMT in 1986, there is
    pessimism as to how quickly Congress will be able to come to a decision
    on a new fee. There is sufficient funding available in the Harbor
    Maintenance Trust Fund to support channel maintenance for the next few
    years. We ask that even as the authorizing committees consider this new
    fee proposal, your committee again provide sufficient appropriations to
    meet the needs for the deep draft navigation program. We believe that
    the budget levels proposed by the Administration for the Kill van Kull-
    Newark Bay and Port Jersey channels are sufficient to meet the demands
    of current navigation requirements. However, we believe that the Arthur
    Kill Channel to Howland Hook project should be constructed starting no
    later than fiscal year 2000. The Howland Hook Marine Terminal is
    growing rapidly and is key to our Port accommodating projected trade
    growth in the near term; hence, we urgently request that it be
    considered a priority under new starts for construction funding. (We
    also respectfully request that funds be appropriated to complete a
    feasibility study to deepen the Claremont Channel.) Lastly, we
    appreciate the Energy & Water Development Subcommittee's diligence in
    providing for the nation's water resource needs. Thank you, and we hope
    that you will have the opportunity to visit our Port in the very near
    future.
                                     ______

      Prepared Statement of Vernon A. Noble, Chairman, Green Brook Flood
                               Control Commission
                                    summary
        The Commission requests that the Congress appropriate $1,000,000
    for the Project in fiscal year 2000, to continue construction of the
    Project in 2000.
        Mr. Chairman and Members of the Subcommittee:
        My name is Vernon A. Noble, and I am the Chairman of the Green
    Brook Flood Control Commission. I submit this testimony in support of
    the Raritan River Basin--Green Brook Sub-Basin project, which we
    request be budgeted in fiscal year 2000 for $1,000,000 in construction
    general funds.
        The Commission was established in 1971, pursuant to an Act of the
    New Jersey Legislature, following disastrous flooding which took place
    in the Green Brook Basin in the late Summer of 1971. That flood caused
    $304,000,000 in damages (April 1996 price level) and disrupted the
    lives of thousands of persons.
        In the late Summer of 1973, another very severe storm struck the
    area, and once again thousands of persons were displaced from their
    homes. $482,000,000 damage was done (April 1996 price level) and six
    persons lost their lives.
        Thanks to the efforts of New Jersey's Representatives and Senators
    in Congress, the Corps of Engineers was authorized by Congress in 1986
    to design a solution to this problem of flooding. The floods of 1971
    and 1973 were only the most recent in a long series of severe floods.
    Flooding in this Sub-Basin dates back to the late 1800's when they were
    first recorded, and has become more damaging as the population of the
    area has grown.
        The Green Brook Flood Control Commission is made up of appointed
    representatives from Middlesex, Somerset and Union Counties in New
    Jersey, and from the 13 municipalities within the Basin. This
    represents a combined population of almost one-quarter of a million
    (248,084) people.
        The Members of the Commission are all volunteers, and for 28 years
    have served, without pay, to advance the cause of flood protection for
    the Basin. Throughout this time, the Corps of Engineers, New York
    District, has kept us informed of the progress of the project, and a
    representative from the Corps has been a regular part of our monthly
    public meetings.
        Thanks to the vigorous support of New Jersey's Congressional
    Delegation, the Congress in 1986 authorized a comprehensive flood
    control project for the protection of the entire Green Brook Basin at a
    then established estimated cost, in 1985 dollars, of $203,000.000
        In the Energy and Water Appropriations Act of 1988, Congress
    included a provision making it clear to the Corps of Engineers that
    protection is to be designed for the entire Green Brook Basin, rather
    than only the lower portion of the Basin, as had at one time been
    studied by the Corps of Engineers.
        During 1998, the Congress, with the agreement of the President,
    appropriated $9,900,000 to initiate construction of the project. Final
    preparations are now underway, and it is expected that actual
    construction will begin in Bound Brook Borough and in western Middlesex
    Borough this year.
        We believe that it is essential that the Green Brook Flood Control
    Project be carried forward, and pursued vigorously to achieve
    protection at the earliest possible date. This project is needed to
    prevent loss of life and property, as well as the trauma caused every
    time there is a heavy storm.
        The General Reevaluation Report of the Corps of Engineers dated
    1997 points out some sobering facts. It shows that the damages which
    would occur in a repetition of the flood experienced here in 1973,
    measured in 1996 dollars, would be $582,700,000.
        New Jersey has programed budget money for its share of the project
    for fiscal year 2000.
        Actual construction will begin this year. We believe that your
    decision of last year to authorize the initiation of construction was a
    wise and prudent decision. It is essential that construction be
    continued in fiscal year 2000.
        We urgently request an appropriation for the project in fiscal year
    2000 of $1,000,000, as proposed by the Administration.
        The more quickly the construction of this project is completed, the
    less will be the total cost, and the sooner the project will provide
    protection.
        Economics and costs are of course important, but personal human
    tragedy, and the loss of life, is more important.
        As you may know, in 1998 an independent Task Force, consisting of
    representatives appointed by the affected municipalities and counties,
    examined alternative possibilities for providing flood protection for
    the upper portion of the basin.
        In late 1998, after regular meetings throughout the year, the Task
    Force reached a unanimous conclusion. They recommended that the Corps
    of Engineers study a specific new possible site for a detention basin.
    They also recommended that the Corps of Engineers review another site
    which had been considered some years ago. Both of these sites are in
    the Watchung Mountains, where flood water must be detained to provide
    protection for the densely populated areas at the foot of the
    mountains.
        Actual construction work in the upper-most portion of the Basin
    does not need to begin for a number of years, and accordingly we are
    confident that acceptable and workable project plans can be developed
    in ample time to meet the approximate ten year construction schedule.
        Thank you, Mr. Chairman, and Members of the Subcommittee, for your
    vitally important past support for the Green Brook Flood Control
    Project; and we thank you for the opportunity to submit this testimony
    to you.
                                     ______

             SOUTHEASTERN U.S. WATER RESOURCE DEVELOPMENT PROJECTS

     Prepared Statement of Sheldon L. Morgan, President, Warrior-Tombigbee
                              Waterway Association

                                   historical
        The Warrior-Tombigbee Waterway Association represents a broad
    cross-section of shippers, carriers, and the general business community
    in the Warrior-Tombigbee basin in Alabama, and users in nine southern
    states. The Association began in 1949 to work for the redevelopment of
    the Warrior-Tombigbee Waterway System. Construction of its original 17
    locks and dams began in the late 1870's, and completed in 1915. The
    navigation system provided by these locks and dams had gradually
    deteriorated and, following World War II, the annual tonnage had
    leveled off at 2.5 million tons, due to the condition and limited
    capacity of the obsolete locks. The Association began in 1950 to work
    with Alabama's Congressional Delegation and the Army Corps of Engineers
    to plan for modernization. Five new locks were built between 1954 and
    1975. The last remaining old structure (Oliver Lock and Dam) was
    replaced in 1992--the first under the Water Resource Development Act of
    1986. The Warrior-Tombigbee Waterway now has modern and standard sized
    locks throughout its length. These six new locks replaced the seventeen
    old, turn-of-the-century locks, and today, this system represents a
    most noteworthy example of the positive impact of the Federal water
    resource development program. The most persuasive evidence of the
    validity of this project and the wisdom of those who made it possible
    comes from the record compiled during and following the investment in
    its redevelopment. During the economic studies which justified these
    investments, it was projected that by 1980, the Waterway would carry
    some eight million tons annually, producing a positive benefit to cost
    ratio. These levels were reached in 1966 and, by 1980, twice the
    projected tonnage was being moved. Traffic has since reached 25 million
    tons annually, a level three times that which had been projected.
    Clearly this has been a valid investment in infrastructure.
        Subsequently, due in large part to the federal investment in this
    waterway, several billion dollars have been invested by industry,
    agriculture and other non-Federal agencies, providing thousands of
    jobs. For example, the Alabama State Docks, as a result of a $300 +
    million expansion program, now offers the most advanced export coal
    handling technology available in this country, along with similar
    improvements for handling grain, bulk materials, steel and forest
    products. It is interesting to note that the investment by this one
    local agency exceeds the total Federal investment in building all the
    locks and dams on the entire waterway, including the new Oliver Lock.
    The Alabama State Docks is once again embarking upon a multi-million
    dollar improvement and expansion program.
                             developments by users
        This Waterway must continue to be efficient and reliable if its
    users are to remain competitive in world markets. Shipments of ore,
    steel, and related products have increased because of the new and
    modern U.S. Steel facilities in Birmingham, and a new British Steel
    mill at Tuscaloosa and Mobile. The efficiency and modernization of the
    waterway have been important factors in U.S. Steel's continuing
    investments to modernize its Fairfield mill. Fairfield is now again one
    of the bright stars in the USX crown. Recent investments substantially
    exceed $1 billion. The new British Steel mill surpassed $100 million in
    initial investment, and an additional $154 million is now underway.
    This mill utilizes the river southbound for export, as well as
    northbound for raw materials and domestic sales of finished product.
    Hence there is a favorable impact on the balance of payments which will
    be further enhanced by the current expansion. British Steel has
    recently completed a $100 million Direct Reduction Iron Plant at Mobile
    to ship production on the Black Warrior-Tombigbee to Tuscaloosa Steel.
        Major facilities for mining interests, forest products and marine
    equipment account for well over another $1.5 billion in recent
    investment. Coal comes out of Kentucky to electric generating plants on
    the BWT. There are new facilities at the Port of Mobile, which handle
    more forest products than the total handled by all other Gulf Coast
    ports. The efficiency and reliability of the waterway are key factors
    in the development and competitiveness of these facilities, upon which
    thousands of jobs depend.
        These are but examples of how this waterway is so central to the
    economy of this entire region, impacting both domestic and
    international markets. Attached with this statement are letters further
    highlighting this importance. These represent a broad cross-section of
    the economic heartbeat of an entire region. Throughout these statements
    you will find repeated references to the importance of confidence in
    the waterway to the willingness of business and industry to continue to
    invest in our area and of their customers to depend on its reliability
    for the movement of their products. Please note the wide range of
    interests represented by these statements: financial institutions;
    public utilities; port facilities; coal mining; manufacturers;
    suppliers; marine interests; petroleum and chemical processors and
    general business.
                                budget requests
        We support the President's recommendation for O&M funds and ask for
    add-ons of $3 million for additional capability be provided for the
    Warrior-Tombigbee Waterway to help catch up on deferred projects. This
    would be realistic funding which we will support as absolutely
    essential to day to day activities of the O&M program, and with good
    management it will allow for the continuation of several on-going
    projects which are near the point of culmination, following several
    years of investigation, design and now beginning the actual work. These
    projects address long-standing problems and have required extensive
    research and coordination and reflect excellent teamwork by the Corps
    and the industry. But for the support of this committee, they would not
    be nearing reality. We wish to emphasize that this level of funding is
    the minimum essential level.
        From this have come both short and long range programs which have
    provided a basis for orderly progress toward keeping the Waterway
    efficient and reliable. The funding requirements to which I have
    referred stem from work we need to continue now under these programs. I
    respectfully repeat that the performance of this waterway in
    successfully handling a level of tonnage some three times the
    projections made during its design, attest to foresight of this
    Committee.
        To summarize, the Warrior-Tombigbee Waterway is a classic example
    of the positive aspects of the Civil Works Program. The Congress has
    seen its potential and has supported its development. And now the
    project continues to demonstrate its worth. Investment and expansion
    continue locally.
        The Warrior-Tombigbee Development Association request for
    Operations & Maintenance funding in fiscal year 1999 for the Black
    Warrior-Tombigbee Waterway in the amount of $16.0 million. This is
    level funding for the normal O&M work, and is the minimum to keep
    navigation capability at a nominal level. However, additional
    capability of the Corps is important to the continuing improvements
    that have been deferred. These include upland disposal sites, mooring
    cells, rock removal, a long range study of future needs and demands and
    other vital improvements totaling $3.0 million. Therefore, our total
    request is for a total of $19,025,000 for fiscal year 2000.
                                     ______

             Prepared Statement of the U.S. Army Corps of Engineers

        The following is a summary of the funding items for the U.S. Army
    Corps of Engineers for fiscal year 2000 to meet the needs of the
    Warrior-Tombigbee Waterway, and which we ask the Committee to approve:

    Warrior-Tombigbee Waterway:
        Operations & Maintenance Funds for Corps' Budget
          fiscal year 2000 (level funding)..................     $16,000,000
        Funds for Additional Capability not included in
          Corps' O&M Budget Request \1\.....................       3,000,000
        For General Investigations (Long Range Study).......         250,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total Funds Required..............................      19,250,000

    \1\ Funds for Additional Capability items are not included in the Corps'
    Budget request, so it is not likely that the committee has been informed
    of the need of funding for this particular Additional Capability. We are
    requesting the additional funds for continuing projects and emphasize
    the need for additional O&M capability funds if we are to have an
    adequate current year program, and to support on-going projects designed
    to improve safety and efficiency and to reduce future costs to the
    Federal Government. O&M projects to be funded from this request are
    continuing projects under the 20 year long range plan for improving the
    BWT, including remaining vital upland disposal sites and recycling three
    that are filled (these substantially reduce annual dredging costs) rock
    removal and stop log replacement (equipment needed for lock
    maintenance). General Investigations funds would be used to continue
    long range studies for further modernization of the waterway.

        Other needs allied to the Warrior-Tombigbee are:
    Mobile Harbor:
        Operations & Maintenance Funds, for Corps' Budget
          fiscal year 2000 \1\..............................     $20,200,000
        Construction........................................         700,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total Funds Required..............................      20,900,000

    \1\ Requested funds for Mobile Harbor are 2.5 million more than the
    President's budget. Historically, this is the level of funding required
    to maintain the harbor.

        Written statements of support are attached.
                                     ______

    Prepared Statement of James A. Vann, Jr., President and Chief Executive
           Officer, Alabama Electric Cooperative, Inc., Andalusia, AL

        On behalf of Alabama Electric Cooperative, Inc. (AEC) and its
    member owners, I respectfully request your support for the Corps of
    Engineers fiscal year 2000 funding request for the Black Warrior-
    Tombigbee Waterway and Mobile Harbor. The enclosed statement explains
    AEC's interest in these projects which are vital to our business. The
    benefits of low-cost coal transportation afforded by these projects are
    enjoyed by our member systems and their individual electrical
    customers' accounts, which number approximately 325,000.
        Please give your support to the Corps of Engineers' budget requests
    for these projects. We sincerely appreciate your continued support in
    this matter and in other issues related to the rural electric program.
                                     ______

          Prepared Statement of the Alabama Electric Cooperative, Inc.

                             background information
        Alabama Electric Cooperative, Inc. (AEC) is a wholesale power
    supplier for 21 member-owners located in central and south Alabama and
    northwest Florida. The member-owners serve over 325,000 customer-
    members. AEC operates the Charles R. Lowman Power Plant, located at
    Milepost 89.5 on the Tombigbee River, a coal-fired power plant which
    burned 1,557,404 tons of coal in 1998. Also, AEC has a site on the
    Black Warrior-Tombigbee River which is a possible location for a future
    base-load fossil fired generating plant.
                       statement of interest and support
        AEC joins the collective effort to improve the efficiency and
    reliability of the Warrior-Tombigbee Waterway because of the lower fuel
    transportation costs which the waterway provides to AEC's Lowman
    electric generating plant. The Black Warrior-Tombigbee Waterway (BWT),
    the Tenn-Tom Waterway, and the Port of Mobile are vital to our delivery
    of coal economically and efficiently to this plant, which is located on
    the Tombigbee River near Jackson, Alabama. During calendar year 1998,
    we received 938,483 tons of coal via the BWT which accounts for over 60
    percent of total coal received.
        Because delivered coal cost is such an important factor in our
    ability to maintain competitive rates to our member systems, AEC
    supports the Black Warrior-Tombigbee project and level funding for the
    Corps of Engineers' fiscal year 2000 budget. In addition, AEC supports
    the critical needs identified by the Corps which have been deferred
    over the past three years.
        In addition to the dependency which AEC has upon the BWT, there are
    benefits to our region and our end-consumers as a direct result of a
    viable BWT waterway and the Port of Mobile. These systems provide an
    invaluable link between our region and the world markets. As such, they
    stimulate the region's economy, provide jobs, and help reduce the trade
    deficit.
      specific benefits of the warrior-tombigbee waterway and the port of
                                 mobile to aec
        The amount of coal moved to AEC's Plant Lowman by barge on the BWT
    for the past six years is as follows:

            Year                                                        Tons
    1993..........................................................   866,731
    1994.......................................................... 1,077,485
    1995..........................................................   874,044
    1996.......................................................... 1,103,919
    1997.......................................................... 1,052,575
    1998..........................................................   938,483
                        --------------------------------------------------------------
                        ____________________________________________________

          Total................................................... 5,913,237

        The savings in transportation costs represented by the above
    tonnage exceeds $30 million compared to AEC's next viable option of
    delivery via rail.
        AEC plans to continue to move the majority of its coal via the BWT
    in 1999 and beyond. We have utilized the Port of Mobile for
    transloading a small test shipment of foreign coal, and have made
    further plans to accept more of this coal for testing in 1999.
                 statement with regard to appropriation amounts
        AEC supports near level funding ($16 million) for Operation and
    Maintenance in the Corps of Engineers' Fiscal Year 2000 Budget. We view
    this as a minimum requirement in that this level of O&M funding is
    necessary to cover the minimum expected needs within the Mobile
    District for fiscal year 2000. In addition, there are vital
    improvements which would bring the waterway efficiency to a higher
    level, totaling $3,000,000.
        AEC also supports the appropriation of adequate O&M funds of
    $20,200,000 for Mobile Harbor.
        Lastly, AEC supports an amount of $250,000 for General
    Investigations, as identified by the Corps in cooperation with the
    Warrior-Tombigbee Waterway Association.
                                   conclusion
        We appreciate the opportunity to submit a statement on behalf of
    our member owners in central and south Alabama and northwest Florida
    pertaining to the benefits of the BWT waterway and the Port of Mobile.
    AEC and its member-owners fully support the Corps of Engineers' 2000
    budget request for $16 million in operations and maintenance funds for
    the BWT waterway, the appropriation of an additional $3 million in
    funds for deferred projects, as well as $250,000 for General
    Investigations, and $20.2 million for Mobile Harbor O&M. While we are
    well aware of budget constraints, we believe these projects should be
    funded at these levels to assure a viable transportation system. With
    the money that has already been spent in construction of the BWT
    transportation system, proper funding for operations and maintenance
    is, in our view, prudent management of what is undoubtedly a national
    asset.
                                     ______

       Prepared Statement of Lynn Sherrill, Vice President, Operations,
                        Crounse Corporation, Paducah, KY

        Maintenance and improvements to the Warrior-Tombigbee Waterways and
    Mobile Harbor are a matter of vital interest to our Company. Crounse
    Corporation has, since 1990, barged approximately one million tons of
    coal per year from the Upper Ohio Valley to locations on the Black
    Warrior River and Mobile, Alabama area.
        We have found the Warrior-Tombigbee Waterway to be our highest cost
    operating area, and can ill afford to have the system deteriorate below
    its present level, because of reduced maintenance funding.
                                     ______

      Prepared Statement of Charles Story, Vice President Governmental &
                   Public Affairs, Degussa-Huls, Theodore, AL

        Degussa-Huls Corporation is pleased to have the opportunity to
    express our support for the $16 million Corps of Engineers' Operations
    and Maintenance Budget for the Warrior-Tombigbee Waterway and for the
    $3 million additional funding necessary to complete badly needed
    projects which have been delayed due to the lack of funding. The Port
    here in Mobile is very crucial to the economic well being of our entire
    Community, and we also strongly support an appropriation of $20.2
    million for the Mobile Harbor.
        Our Company has invested over $1.5 billion in the Mobile Area, and
    employ over 1500 employees from this area. As such we are one of the
    largest employers in south Alabama. Our Company as well as many other
    companies in the area who are part of the Chemical Industry are heavily
    dependent on the Warrior-Tombigbee Waterway System and the Harbor
    facilities here in Mobile. Our industry each year moves a tremendous
    amount of raw materials and finished products through the Port and the
    Waterway System. The increased efficiency which we would experience as
    a result of these appropriations would directly benefit our Company and
    our industry, and lay the ground work for even more growth in an
    industry which has contributed greatly to the sound economy which we
    enjoy here in south Alabama.
        Degussa-Huls which is German owned selected Mobile 25 years ago
    partly because of the good transportation infrastructure which we have
    here in the Port of Mobile. The Port and the Waterway System are a
    vital link in this infrastructure. We have had a number of expansions
    here in Mobile (in competition with other sites in Europe) which were
    made possible by transportation advantages that we enjoyed in this
    area. Maintaining and improving this infrastructure and its efficiency
    with adequate appropriations will provide significant benefits for the
    entire south Alabama Area.
        We urge you to support these appropriations, and thank you for your
    consideration of our request.
                                     ______

                         Letter From Joseph H. Langjahr

                                                 Foss Maritime,
                                        Seattle, WA, February 18, 1999.
    Hon. Pete V. Domenici,
    Chairman, Subcommittee on Energy & Water Development, U.S. Senate,
            Washington, DC.
        Dear Chairman Domenici: The purpose of this letter is to express
    our support of the Warrior-Tombigbee Waterway project and, in
    particular, our support of the Corps of Engineers O&M budget of $16.0
    million for this waterway, together with additional critical needs.
        Foss Maritime Company began providing marine transportation
    services in the Pacific Northwest in 1889. During the past 110 years,
    Foss Maritime has developed a complete waterborne tug and barge
    transportation system that currently operates throughout Puget Sound,
    Washington; Alaska; Columbia/Snake Rivers, Oregon; San Francisco and
    Southern California. We deploy over 200 tugs and barges in order to
    perform a multitude of commodity movements, vessel-related harbor
    services and international and coastwise ocean towing. During the past
    decade, Foss Maritime has invested more than $100 million in vessel
    conversions and new construction to rebuild and modernize its fleet of
    marine equipment. We employ about 1,300 people throughout our operating
    area.
        Recently, Foss Maritime was selected by The Boeing Company to
    design, build and operate a roll-on, roll-off ship to transport Boeing-
    built Delta IV rocket boosters from Decatur, Alabama, to space vehicle
    launch sites at Cape Canaveral Air Station, Florida, and Vandenberg Air
    Force Base, California. The 310-foot ship, to be owned and operated by
    Foss Maritime or one of its subsidiaries, under Boeing time charter,
    will carry three common booster cores and associated containerized
    cargo. At a light operating draft of eight feet, the ship will be
    capable of navigating the Tennessee-Tombigbee Waterway and Warrior-
    Tombigbee Waterway from Boeing's rocket booster factory being built in
    Decatur.
        This Foss Maritime ship is scheduled to enter Boeing service by
    July 1, 2000. We have awarded a contract to Halter Marine, Inc.,
    Gulfport, Mississippi, to construct the ship, along with an option for
    a second vessel, and it is being built in Halter Marine's shipyard in
    Pascagoula, Mississippi.
        The primary operating route of this ship will be through the
    Tennessee-Tombigbee Waterway and Warrior-Tombigbee Waterway from
    Decatur to Mobile, Alabama; from Mobile through the Gulf of Mexico and
    the Atlantic to Cape Canaveral; and from Mobile through the Caribbean
    Sea, Panama Canal and the Pacific to Vandenberg. Therefore, maintenance
    of the Warrior-Tombigbee Waterway and strict compliance with regulated
    pool depths is absolutely essential to the success of this entire
    Boeing project.
        Last year the amount appropriated to the Corps of Engineers for
    Warrior-Tombigbee Waterway Operations & Maintenance was $16.0 million.
    The Waterway will need at least level funding for fiscal year 2000.
    However, the Corps has additional capability for certain projects such
    as upland disposal programs, rock removal and stop log replacement.
    These are vital to the continuing improvements year to year which
    ultimately will bring the Waterway efficiency to an expected level. We
    encourage your committee to provide an additional $3.0 million in O&M
    capabilities for these projects.
        Finally, Mobile Harbor is an important component of our project and
    we support the appropriation of funds in an amount of $20.2 million.
        Thank you for the opportunity to present our views and our concerns
    to you and your committee on these vitally important projects.
                Very truly yours,
                                            Joseph H. Langjahr,
                                      Vice President & General Counsel.
                                     ______

      Prepared Statement of Allen Henry, President, Henry Marine Service,
                          Inc., Spanish Fort, Alabama

        We join in the collective effort of the Warrior Tombigbee Waterway
    because of lower costs, energy efficiency, all are important to local,
    national, and international commerce.
        Henry Marine Service, Inc. operates out of the Mobile, Alabama area
    offering support services to the larger inland barge lines serving the
    states of Alabama, Mississippi, Florida, and Louisiana. We employ
    approximately 25 employees on a full time basis in the repair service
    for towboats and barges. In addition, I own three towboats providing
    towing in the Mobile harbor for the inland towing companies requiring
    smaller towing vessels to deliver their barges dockside and shipside in
    the Mobile area.
        Additionally, smaller tugboats normally service the barge lines by
    towing their barges to locations in the tri-state area where it is not
    possible to navigate with the larger towboats used by the major barges
    lines. This service requires me to employ about thirty pilots and
    deckhands full time, in addition to my shipyard employees.
        The Warrior Tombigbee Waterway, Tennessee Tombigbee, and Alabama
    River are very important to the viability of my company. Therefore it
    is very important that the Corps of Engineers continue to receive
    maximum funding for the fiscal year 2000.
        We cannot emphasis enough how important it is for the level of
    funding of 16 million dollars, additional O&M capabilities of 3 million
    dollars, and general investigation funding of .25 million dollars be
    approved for fiscal year 2000.
        Also, we strongly endorse and support the appropriation of funding
    for the Mobile harbor in the amount of 20.2 million dollars in fiscal
    year 2000.
        If these annual appropriations for funding of waterway projects do
    not continue, then companies like Henry Marine Service, Inc. will
    disappear
        Thank you very much for your efforts.
                                     ______

         Prepared Statement of J. Tim Wilk, Hunt Crude Oil Supply Co.,
                                 Tuscaloosa, AL

        Hunt Refining Company presently employs approximately 250 residents
    of West Alabama and has been an important participant in the local
    economy since 1946. Curtailment of our use of the Warrior-Tombigbee
    Waterway System (WTWA) would have a long-term impact on employment at
    Hunt Refining Company and ultimately, the surrounding counties.
        The WTWA system and the Port of Mobile are critical to the
    operation of our Refinery in Tuscaloosa, Alabama. We barge over 40
    percent of our crude oil and over 25 percent of our refined products
    using both the Port of Mobile and the WTWA system. We use the Port of
    Mobile as a starting point to pipeline or barge foreign and domestic
    crude north at the rate of approximately 12 million barrels per year.
        Hunt Refining Company supports the Warrior-Tombigbee project and
    joins the collective effort to improve the efficiency and reliability
    of the WTWA system. We are currently limited by draft restrictions most
    of the year, high river the other part of the year, and to a special
    combination of two-barge tows all year. Through improvements, we can
    avoid significant increased costs during periods when the river is
    above flood stage or at very low levels. Increased navigability of the
    waterway, increases our transporter choice, ultimately keeping costs
    competitive.
        The corps of Engineer's 1999 Budget for the BWT Operations and
    Maintenance is $16.0 MM. We believe the BWT needs at least level
    funding to cover the minimum expected needs for fiscal year 2000. The
    Corps has several projects, which have been deferred over the last
    three years that can now get underway. These include the upland
    disposal programs, rock removal and stop log replacement. These
    deferred projects as well as funding for several studies will cost an
    additional $3.25 MM. We are asking for your support for a total of
    $19.25 MM for fiscal year 2000.
        We further support the funds needed for the Mobile Harbor in the
    amount of $20.2 MM.
                                     ______

    Prepared Statement of James M. DeCosmo, Manager of Lands, Research and
         Procurement, Southeast Timberlands, Kimberly-Clark, Mobile, AL

        Kimberly-Clark (K-C), began operations in Mobile following its
    merger with Scott Paper in December of 1995. Including the acquisition
    cost, K-C has invested over $2 billion in the Mobile Plant and support
    operations. These investments represent an average annual capital
    investment of $50 million in Mobile.
        For the past sixteen years, Kimberly-Clark has continuously
    utilized the Warrior-Tombigbee Waterway, Coosa-Alabama River System, as
    well as the Port of Mobile. In 1983, the first year K-C shifted from
    truck and rail to river transportation, some 1.06 million tons of
    forest products were transported with two tugboats and forty barges.
    Due to the efficiencies and reliability of the Waterways, K-C
    transported in excess of 3.5 million tons of forest products in 1998,
    1.0 million of which was exported to International Markets. To sustain
    marine operations at this level requires over 20 tugboats, 150 barges
    and over 250 jobs directly related to operations and maintenance.
        For K-C to operate on the Waterway requires operating expenses in
    excess of $13.5 million. These operating expenses are required to
    support a $28 million capital investment in wholly owned woodyards and
    joint venture wood processing facilities.
        With this investment in Kimberly Clark's Southern Operations and
    the dependence on the Waterways, it is critical that the river
    channels, locks & dams, bridges, harbors and all other elements of
    navigation be adequately maintained, upgraded and funded to meet the
    existing and future demands of the waterways, particularly the Warrior-
    Tombigbee Waterway.
        In consideration of the value of the river system and the
    importance of operational reliability, Kimberly-Clark unanimously
    supports and recommends a minimum of $16.0 Million for the fiscal year
    2000 Operations and Maintenance budget for the Warrior-Tombigbee
    Waterway and $20.20 Million for Mobile Harbor.
        K-C is a multi-billion dollar packaged products company
    strategically focused on diapers, personal care products, consumer
    tissue and away-from-home products. To continue to be the market
    leader, all facilities and operations throughout the world must remain
    competitive, from the procurement and transportation of raw materials
    to the satisfaction of each and every customer.
        The Mobile operation has been and is committed to being a leader in
    World markets. To maintain a position of leadership and a viable
    operation, all facets of manufacturing must continually improve. To
    remain a competitor in a highly competitive industry, it is imperative
    that the waterways continue to be adequately maintained and upgraded to
    meet the challenges tomorrow brings. The Warrior-Tombigbee and Coosa-
    Alabama River waterways are the ``Main Artery'' that support the Mobile
    Harbor, Kimberly-Clark's Southern Operations and the thousands of jobs
    directly and indirectly related to its business. These waterways and
    ports will play a significant role in K-C's future success.
        With these considerations in mind, we ask that you give the
    requested budgets and appropriations your full support.
        Thank you for your help, consideration and support in this matter.
                                     ______

    Prepared Statement of John S. McClelland, Jr., Midstream Fuel Service,
                                Inc., Mobile, AL

        As a member of the Subcommittee on Energy & Water Development, your
    active support is requested for fiscal year 2000 projects designated by
    the Army Corps of Engineers for the Port of Mobile and the Black
    Warrior-Tombigbee Waterway. The crucial projects designated by the Army
    Corps of Engineers for these strategic waterways are necessary to
    sustain normal operations and to provide for regular maintenance.
        The Port of Mobile is a vital link for the Southeast region of our
    nation to trading partners both domestic and foreign. Multiplying the
    effectiveness of the Port of Mobile is the Black Warrior-Tombigbee
    Waterway which links the harbor to 16,000 miles of the inland waterway
    system. The efficiencies of these waterways will continue to enhance
    economic opportunity and prosperity in the Southeast region.
        Our company, Midstream Fuel Service, Inc., with headquarters in
    Mobile, Alabama, is an ardent supporter of the efforts of the Army
    Corps of Engineers to operate and maintain these assets. Growth and
    maintenance of these waterways have allowed our company to grow from a
    one-boat, one-barge harbor operation to a dynamic petroleum supply and
    support company. We operate towboats, tank barges and marine terminals
    which all rely on these waterway systems to service the marine needs of
    our customers. Our service reaches deep into Alabama on the Black
    Warrior-Tombigbee Waterway, allowing our inland customers to ship bulk
    petroleum products in an efficient, cost-effective manner. In the Port
    of Mobile, we supply fuel to ships, tugs and inland vessels that are
    transiting the region. Vessels employed in offshore oil production use
    our Mobile harbor base for support services. The level of our
    commercial success has been and will continue to be highly dependent on
    the efficiency of these waterways.
        For fiscal year 2000, the Army Corps of Engineers will need a level
    funding of $16 million for operation and maintenance of the Black
    Warrior-Tombigbee Waterway. An additional $3.0 million will be
    requested for improvement projects that have been deferred during the
    past three years but are ultimately needed. These projects include
    upland disposal programs, removals and stop log replacement. There is
    also a need for general investigations with required funding of $.25
    million.
        The fiscal year 2000 funding requirement for operation and
    maintenance of the Mobile Harbor is $20.2 million. Continued O&M
    funding for the Mobile Harbor is critical to the Port of Mobile and the
    Black Warrior-Tombigbee Waterway.
        The Warrior-Tombigbee Waterway Association will present statements
    of support for the Army Corps of Engineer's funding proposal to your
    Subcommittee during the first week of March. Midstream Fuel Service,
    Inc. enthusiastically supports their testimony as representative of
    those who depend on the Warrior-Tombigbee Waterway and the Port of
    Mobile for our commercial success.
        Thank you for the work you have done in the past to keep these
    waterways navigable. We look forward to continued successful navigation
    in the Port of Mobile and on the Warrior-Tombigbee Waterway.
                                     ______

    Prepared Statement of George E. Duffy, President, Navios Ship Agencies,
                                Inc., Mobile, AL

        We request that you support the U.S. Army Corps of Engineers'
    Operations and Maintenance Budget for $19,000,000 and General
    Investigations funding of $.25 million for the Warrior-Tombigbee
    Rivers.
        Our vessels and our principal's vessels carry 3.4 million tons of
    iron ore and 1.8 million tons of furnace coke per year with the
    majority bound for industries in the State of Alabama. The Port's
    ability to maintain its present draft has enabled us to remain
    competitive on the world market. The continued dredging of the Warrior-
    Tombigbee allows this cargo to go through the waterway system of the
    Tombigbee. The U.S. Army Corps of Engineers has done an outstanding job
    maintaining this system.
        A large portion of this cargo is for steel operating in the
    Birmingham, Alabama area. These import raw materials enable the steel
    mills to supply steel for various supplies to this nation. Some of
    these cargo products from the steel mills are re-exported through the
    Port of Mobile, which helps to reduce our trade imbalance. The
    efficiency and reliability of waterways commerce is essential for us to
    provide the raw materials necessary for our principals to meet the
    demands of the various markets within the State of Alabama and the
    United States.
        We have been in operation since 1957 utilizing the Port of Mobile,
    the Warrior-Tombigbee and the Black River systems. We realize the
    importance of tight budget control, yet the benefits on industry,
    commerce and trade as well as job return must be recognized. Therefore,
    we solicit your support. We join in the collective efforts of all those
    affiliated companies who realize the importance of maintaining this
    waterway system so that we may continue to bring in the necessary raw
    materials for our manufacturing industries within the State of Alabama.
    For these reasons, we request you to support the $19,000,000 for the
    Operations and Maintenance programs for fiscal year 2000.
                                     ______

                           Letter From M. Dean White

                           Orsouth Midland Enterprises,
                                         Orsouth Transport Co.,
                                             Mobile, AL, March 1, 1999.
    Hon. Pete V. Domenici,
    Chairman, Subcommittee on Energy & Water Development,
    U.S. Senate, Washington, DC.
        Dear Senator Domenici: I am writing to express my support for the
    continued maintenance and improvement of the Black Warrior-Tombigbee
    Waterway System.
        Orsouth Transport Co. is one of the largest regional carriers by
    water in the Warrior-Tombigbee System. Last year we transported
    approximately 2.0 million tons of commodities on this waterway, and an
    additional 2.8 million tons through the Port of Mobile, including coal,
    scrap metals, direct-reduced iron, and aggregates. These tonnages are
    significant to the economies of the states in that region, from the
    points of view of both producers and consumers. Barging is a very low-
    cost method of transportation, responsible for moving more than 15
    percent of all of the United States total freight for less than 2
    percent of the nations total transportation costs. This translates into
    savings for the consumer, such as lower rates for electricity.
        Another important aspect of the Warrior-Tombigbee System is that it
    provides the only alternative to the Mississippi River to move product
    to the Gulf Coast. This was extremely important during the drought year
    of 1988, when the lower portion of the Ohio River was closed for an
    extended period, and the lower Mississippi River was severely
    restricted for approximately five months. The availability of the
    Warrior-Tombigbee System allowed us to continue to serve utility and
    industrial customers, and keep those customers from having to shut down
    operations because they could not receive raw material.
        Orsouth Transport Co. fully supports and recommends appropriation
    of $16 million for operations and maintenance of the Black Warrior-
    Tombigbee System for fiscal year 2000. Furthermore, we recommend
    additional funding to permit the Corps of Engineers to proceed with
    some of the projects that have been deferred over the past three years,
    which total $3 million. These projects include upland disposal
    programs, rock removal, and stop log replacement. Another $.25 million
    is being requested for General Investigations, vital to long-term
    planning. All of these funds are necessary to assure that the Warrior-
    Tombigbee System remains an important part of the Inland Waterway
    System. Finally, we support an appropriation of funds in the amount of
    $20,200,000 for Mobile harbor. The Port of Mobile is an integral part
    of the waterway system, especially as an alternative origin to the Port
    of New Orleans. Improvement of the Mobile harbor will increase
    utilization of the Warrior-Tombigbee System overall, and generate
    significant additional monies for the states in this region. We request
    your support in reviewing and approving these project funding limits
    for fiscal year 2000.
                Sincerely,
                                                 M. Dean White,
                                                          Port Captain.
                                     ______

    Prepared Statement of Charles A. Haun, Executive Vice President, Parker
                      Towing Company, Inc., Tuscaloosa, AL

        My name is Charles A. Haun and I am Executive Vice President for
    Parker Towing Company of Tuscaloosa, Alabama.
        We are a full service marine transportation company operating a
    fleet of boats and barges and twelve ports on the southern portion of
    the U.S. Inland Waterways System. We are involved in the transportation
    of all types of commodities including coal, coke, ores, stone, forest
    products, steel, and manufactured products. We have been in operation
    for over fifty years and our approximately 200 employees are entirely
    dependent upon the efficiency of the waterway.
        Parker Towing Company endorses and supports fully the efforts of
    the Warrior-Tombigbee Development Association to improve the overall
    operation of this vital waterway system. The Warrior-Tombigbee System
    and the Port of Mobile are of great importance to our company and the
    industries we serve. Proper and adequate funding of the waterway
    project will ensure that more industries can rely on this energy
    efficient delivery system. The region's employment and economic well-
    being could be adversely affected to a great degree should the
    efficiency of the waterway be degraded.
        As a member of the Warrior-Tombigbee Development Association,
    Parker Towing Company emphatically supports an appropriation of $16
    million for the Corps of Engineers for operation and maintenance of the
    Warrior-Tombigbee System for fiscal year 2000, additional capability
    funding of $3.0 million, and general investigations of $0.25 million,
    for a total of $19.25 million. In addition, we support the Corps'
    request for operation and maintenance funds for Mobile Harbor in the
    amount of $20.2 million.
                                     ______

      Prepared Statement of Lawrence L. Merrihew, Senior Vice President,
                            Regions Bank, Mobile, AL

        The economies of Alabama and the U.S. Gulf Coast are greatly
    impacted by the Port of Mobile and the inland waterways serving these
    areas. The Black Warrior-Tombigbee Waterway is also a vital factor in
    this respect. It serves manufacturing, mining, and the agricultural
    areas, as well as industrial production facilities in western Alabama.
    The waterway has served as an economic stimulant for over 100 years and
    receives periodic improvement, bringing it to the point today, that it
    is a modern system linking vital areas of the economy.
        There are so many vital materials that are shipped on the Black
    Warrior-Tombigbee Waterway that its overall impact is sometimes not
    adequately considered. For instance, most of the coal exported from
    Mobile is shipped down this very waterway. Therefore, it is important
    that the amount needed, as requested by the Corps of Engineers for
    Operations & Maintenance (O&M) of $16.0 million, be appropriated for
    fiscal year 2000. This level of funding is necessary to support the day
    to day O&M program, and to continue ongoing channel improvement
    projects that will maintain the waterway in its current state. In
    addition, there is a request for $3.0 million to continue projects that
    have been on hold for the past three years (upland disposal programs,
    rock removal, and stop log replacement). We desperately need your
    support for these projects also.
        We also request support of the appropriation of adequate O&M funds
    for the Mobile Harbor in the amount of $20.2 million.
        An efficient and reliable waterway system is important to all of
    us, and most certainly is a justifiable investment by the federal
    government. The cost benefit ration will be matched many times over by
    the local investment.
                                     ______

                          Letter From Jerry L. Stewart

                                   Southern Company Generation,
                                      Birmingham AL, February 19, 1999.
    Hon. Pete V. Domenici,
    Chairman, Subcommittee on Energy & Water Development, U.S. Senate,
            Washington, DC.
        Dear Congressman Domenici: On behalf of Alabama Power Company, Gulf
    Power Company, and Mississippi Power Company, I am writing to express
    our support for the Warrior-Tombigbee Development Association and its
    president in their efforts before your committee. Because of the
    importance of the Warrior-Tombigbee Waterway to local, national, and
    international trade, the Southern electric system joins with the
    Warrior-Tombigbee Development Association in an effort to improve the
    efficiency and reliability of the Warrior-Tombigbee Waterway.
        Alabama Power Company, Gulf Power Company, and Mississippi Power
    Company have used the Warrior-Tombigbee to transport coal to their
    respective electrical generating plants at Demopolis, Alabama, West
    Jefferson, Alabama; Mobile, Alabama; Pensacola, Florida; Sneads,
    Florida and Biloxi, Mississippi. In 1997, through the use of contracted
    barge carriers, these companies moved over 10.3 million tons of coal by
    way of the Warrior-Tombigbee Waterway. All of this coal would have
    required a longer move down the Mississippi River through New Orleans.
    The Warrior-Tombigbee Waterway allows the barges to move down the
    Warrior-Tombigbee River to Mobile and other destinations. The
    significant importance of this capability to our system is obvious from
    a transportation flexibility standpoint. Additionally, the Port of
    Mobile is the hub of the Central Gulf Coast and the continued
    development of its facilities and support services is critical to the
    economy of the tri-state area served by the Southern electric system.
        Alabama Power Company, Gulf Power Company, and Mississippi Power
    Company utilize water transportation because of the economic advantage
    to our millions of customers. Any expenditures for maintenance or
    upgrading which improve the efficiency and reliability of the waterway
    will have a positive impact on our customers. At the same time, higher
    cost resulting from inefficiency or the unreliability of the Warrior-
    Tombigbee Waterway will have a direct and adverse effect upon our
    customers.
        It is imperative that there be a continuous program for maintenance
    and upgrading of the Warrior-Tombigbee Waterway channels and locks. We
    support the proposed budget request for $16.0 million in Operations and
    Maintenance funds for the Black Warrior-Tombigbee River for the fiscal
    year 2000. Additionally, we support the earliest completion of the
    capital projects (upland disposal programs, rock removal an stop log
    replacement) that have been deferred over the past three years in the
    amount of $3.25 million, as well as the appropriation of funds for
    Mobile Harbor in the amount of $20.2 million.
        Adequate funding of programs required to maintain the efficiency
    and reliability of our nation's waterways is critical to its superior
    economic health and welfare. I strongly urge and solicit your support.
                Sincerely,
                                              Jerry L. Stewart,
                                          Vice President Fuel Services.
                                     ______

    Prepared Statement of Carlton J. Melton, Regional Vice President, Gulf
          & Inland Region, Stevedoring Services of America, Mobile, AL

        Stevedoring Services of America (SSA), is a 50 year-old stevedoring
    and marine terminal operating company that utilizes the Warrior-
    Tombigbee Waterway and Port of Mobile, AL in our daily operations. We
    handle approximate annual tonnage, via the Tombigbee Waterway and Port
    of Mobile as follows: 1.7 million tons of forest products, 1.5 million
    tons of bulk cargo (coal) through Mobile and 270,000 tons of bulk and
    breakbulk products through the Port of Columbus, MS. This business
    results in direct employment of sixty (60) people and an additional
    300,000 man hours per year for four (4) local International
    Longshoremen Association unions generating an annual total of over
    $12.5 million in wages and benefits.
        SSA fully supports the collective effort to improve the efficiency
    and reliability of the Warrior-Tombigbee Waterway (BWT). The waterway
    is a vital national transportation artery providing access to low cost,
    energy efficient, environmentally safe barge transportation. Moreover
    it is critical to SSA's business, to maintaining international commerce
    at the Port of Mobile and growing our local, state and national
    economy. Maintaining and improving the efficiency and reliability of
    the waterway is essential to protect and grow SSA's business.
        SSA's supports the position that the Corps' submitted budget for
    the BWT should be at least level funding ($16.0 million) for fiscal
    year 2000 and that the Corps has the additional capability ($3.0
    million) for fiscal year 2000 to get underway those projects which have
    been deferred over the past three years (upland disposal programs, rock
    removal and stop log replacement). We also support $0.25 million for
    general investigations.
        Maintaining the Mobile Harbor is critical to our business, and the
    Alabama State Docks. Therefore, we urge your support for appropriation
    of funds ($20,200,000) for maintaining and improving the Mobile Harbor.
        We strongly urge you to support the aforementioned budget request.
    The BWT is an important segment of our national transportation
    infrastructure. After all, our nation's transportation infrastructure
    is what keeps America moving and competitive in the global economy.
        We very respectfully appreciate your consideration of this matter.
                                     ______

     Prepared Statement of Michael D. Thompson, President, Thompson Power
                            Systems, Birmingham, AL

        We are pleased to express our support of the Warrior-Tombigbee
    Waterway and the Port of Mobile. These natural resources provide a
    vital economic link for many communities along the Birmingham and
    Mobile corridor. Thompson Power Systems has benefited from the strong
    growth of the Southeast's economy. Our marine business has grown and we
    expect growth to continue. The continued reliability of the Waterway
    and the Port of Mobile are paramount to our company's success and the
    long term expansion of our regional economy.
        The Port of Mobile is the gateway to international markets for many
    U.S. products. Likewise, the Waterway network that serves the inland
    states provides efficient transportation of bulk cargoes that fuel our
    heartland's economy. Thompson Power Systems joins in an industry-wide
    effort to improve the efficiency and maintain the reliability of the
    waterways and ports through which we provide our business. Therefore,
    we support the following appropriation of funds:

    Warrior-Tombigbee Operations & Maintenance..............     $16,000,000
    Study for General Investigations........................         250,000
    Funds for Mobile Harbor.................................      20,200,000
    Corp of Engineers Deferred Projects.....................       3,000,000

        As noted, we encourage the Corps of Engineers to commence the
    projects that have been deferred. Projects such as the construction of
    upland disposal dikes and mooring cells are vital to the steady use of
    the waterways systems.
        Thank you for your consideration of this issue which greatly
    impacts our company and region.
                                     ______

    Prepared Statement of Keith H. Jansen, Director, Raw Materials Planning
         Procurement Distribution and Sales, U.S. Steel, Pittsburgh, PA

        USX Corporation is heavily involved in the transportation of raw
    materials for steel making throughout the United States. Due to the
    fact that transportation rates are such a large part of raw steel
    costs, and, imported steel has been given an unfair advantage, it is
    vital that the Federal Government maintains the transportation
    infrastructure of this country in preserving the ability of the steel
    industry to remain competitive. It is with this in mind, that we
    request the United States Senate fully support the Warrior-Tombigbee
    Waterway System. Water borne transportation is by far the lowest cost
    mode, as it affords USS Fairfield Works in Birmingham Alabama the
    opportunity to move raw materials inbound and steel outbound by water
    at a cost that assists in preserving the economic viability of that
    plant.
        It is for this reason that we offer our support to the Corps of
    Engineers in their request of level funding ($16 million) for fiscal
    year 2000. Additionally we support the Corps for funding ($3.0 million)
    of those projects, which would enhance the present waterways
    capabilities and the maintenance of the Mobile deep water harbor
    ($20,200,000). Obviously the Warrior-Tombigbee is essential in the
    continued industrial development of the entire southeastern region and
    remains an integral transportation cog in the wheel of commercial
    success.
        We do appreciate the support that you and your colleagues have
    provided in the past and look forward to your continued support in
    preserving a strong domestic economy.
                                     ______

      Prepared Statement of T. Keith King, P.E., President and CEO, David
                     Volkert & Associates, Inc., Mobile, AL

        David Volkert & Associates, Inc. (Volkert) is an engineering/
    architectural/planning firm which employs 450 people and maintains
    Alabama offices Birmingham, and Gulf Shores. Volkert strongly supports
    funding for the Warrior-Tombigbee Waterway and the Port of Mobile for
    fiscal year 2000.
        We believe the proposed $16 million for Operations and Maintenance
    funds is justified since this level funding amount is necessary to
    cover the known and reasonably expected needs for fiscal year 2000,
    support the day-to-day O&M program, and continue on-going channel
    improvement projects. In addition, we support an additional $3,000,000
    needed by the Corps to continue on projects which have been deferred
    for the past three years (upland disposal programs, rock removal and
    stop log replacement). We also support appropriating $250,000 for
    general investigative studies, which ultimately will bring the waterway
    efficiency to the expected level.
        Since the City of Mobile's largest industry is her Port and the
    City's present economy and future progress depends upon her Port,
    Volkert also supports the $20.2 million funding for Mobile Harbor.
        Confidence in the Waterway and its efficiency and modernization are
    important in bringing much needed new industry to Mobile and to the
    State of Alabama. Lower operating costs to users of the Waterway and
    Port of Mobile are essential in obtaining a reasonable balance of the
    international export market allowing the U.S. to continue to reduce our
    trade deficit. Increases in shipping and commerce result in
    opportunities for many companies, similar to Volkert, to obtain
    business and offer meaningful employment to citizens of the State of
    Alabama and other parts of the U.S.
        Volkert appreciates this opportunity to express our support of
    Chairman Charles A. Haun and President Sheldon L. Morgan, of the
    Warrior-Tombigbee Waterway Association, and the testimony to be given
    by them before the Appropriations Committee of the Senate and House. We
    are proud to join in the collective effort to improve the efficiency
    and reliability of the Warrior-Tombigbee Waterway and the Port of
    Mobile.
                                     ______

                         Letter From George R. Richmond

                                    Jim Walter Resources, Inc.,
                                      Brookwood, AL, February 26, 1999.
    Hon. Pete V. Domenici,
    Chairman, Subcommittee on Energy and Water Development, U.S. Senate,
            Washington, DC.
        Dear Senator Domenici: I would like to thank you for the
    opportunity to make a statement to your Subcommittee. Please accept
    this letter as my statement.
        Jim Walter Resources, Inc. currently mines 8 million clean tons of
    coal per year. Of that amount, nearly 60 percent of our production is
    exported. All of our export production goes through the Port of Mobile.
    Our payroll for 2,100 employees last year was in excess of $107,000,000
    and taxes withheld and/or paid were in excess of $33,000,000. It is
    obvious from these facts and figures that this Company relies heavily
    on our port facilities and that they are of the utmost importance to
    this Company, its employees and the economy of the State of Alabama.
        I strongly support the Corps of Engineers budget request for $16.0
    Million in Operations and Maintenance funds for the Black Warrior-
    Tombigbee for fiscal year 2000, along with the request for $3.0 Million
    for the Corps to undertake projects which have been deferred over the
    past three years and $250,000 for general investigations. I also
    support the appropriation of funds for Mobile Harbor, in the amount of
    $20.2 Million. Our waterways and port facilities provide economic
    prosperity to Alabama that is worthy of your support. Further, I
    support the statements and testimony to be given by Mr. Sheldon L.
    Morgan, President of the Warrior-Tombigbee Waterway Association. I
    believe that the value of improved efficiency and reliability of the
    Warrior-Tombigbee Waterway and Port of Mobile cannot and must not
    underestimated.
        The world coal business is at its most competitive level in
    history. News of any problems, especially transportation and delivery
    problems, is quickly spread by other coal producers around the world to
    the buyers to discourage purchases here. A blemish on our delivery
    record can have devastating, long-term effects from which we might
    never fully recover. Buyers lost today may never return tomorrow.
    important matter.
        Again, thank you for this opportunity to give my comments on this
    very important matter.
                Sincerely,
                                            George R. Richmond,
                                 President and Chief Operating Officer.
                                     ______

    Prepared Statement of J. Craig Stepan, General Manager, Warrior & Gulf
                       Navigation Company, Chickasaw, AL

        I am J. Craig Stepan, General Manager of Warrior & Gulf Navigation
    Company. Our company is an active member of the Warrior-Tombigbee
    Waterway Association and wholly supports the testimony to be presented
    by Mr. Sheldon Morgan as President of the Association. I wish to take
    this opportunity to highlight the impact that the Black Warrior-
    Tombigbee Waterway and the Port of Mobile have on the success and
    development of our Company.
        Warrior & Gulf is a barge line and terminal operator headquartered
    in Chickasaw, Alabama, and owns 20 towboats and 240 barges, moving
    approximately 9 million tons of bulk materials on the Black Warrior-
    Tombigbee River System. This makes WGN the dominant water carrier
    operating in the region. Additionally, we own and operate two (2) bulk
    and general cargo terminals at Port Birmingham and Mobile, Alabama,
    providing storage, transloading and intermodal services for truck, rail
    and water transportation. Our total employment is 235 people.
        Warrior & Gulf has provided barge transportation on the Black
    Warrior-Tombigbee River Systems since 1940 for export and domestic
    coal, iron ore, coke, import and export steel products, export and
    domestic wood chips, and several other types of bulk commodities. An
    efficient and properly maintained waterway system integrated with the
    Port of Mobile is vital to Warrior & Gulf and its customers. This
    waterway system has made the entire region world competitors through
    the reliable, efficient movement of raw materials and finished products
    both for domestic and overseas consumption. In order to encourage
    continued economic development along this great waterway we must
    continue in our efforts to ensure this viable low cost transportation
    alternative remains in place. The continued efficiency of this waterway
    is extremely critical to the viability of the industries it serves and
    helps to develop. This waterway system and harbor hold great
    opportunity for developing trade initiatives with Mexico, South America
    and the world.
        Historically, our shoaling problems vary greatly from year to year
    dependent upon the length of our high water season (December-April) and
    the amount of flooding that occurs. This winter we have been placed on
    notice by the U.S. Corps of Engineers that normal spring and summer
    river operations will be jeopardized due to severe shoaling at Buena
    Vista, Little McGrews, St. Elmo, Jackson and East Bassetts. The full
    extent of the economic impact of this problem is difficult to estimate,
    but clearly all the river carriers and their customers will suffer a
    negative financial impact.
        We have worked closely with the Corps of Engineers and
    wholeheartedly endorse their budget request of $16.0 million in O&M
    funds for the Black Warrior-Tombigbee system for fiscal year 2000 to
    ensure continued transportation operations.
        An additional $3.0 million is required to fund necessary deferred
    projects including channel rock removal, upland disposal site
    management and stop log replacement. Beyond that $.250 million is
    required to fund a study essential to planning the effective long term
    use of the waterway.
        Lastly, it goes without saying that the maintenance of the Mobile
    harbor is vital to our waterway and the entire southern region. We,
    therefore, support the appropriation of $20.2 million to adequately
    fund Mobile harbor's O&M needs.
        Our company and its employees respectfully request your continued
    support and assistance as your subcommittee considers appropriation of
    funds for these very important issues concerning the Black Warrior-
    Tombigbee System, the Port of Mobile and those they serve.
                                     ______

       Prepared Statement of Jack E. Ravan, Director and Chief Executive
              Officer, Alabama State Docks Department, Mobile, AL
        The State of Alabama, as a result of the strategic location of the
    Port of Mobile on the Gulf of Mexico and its extensive inland waterway
    system, is one of the major maritime states within the continental
    United States. The State, primarily through the facilities of the
    Alabama State Docks in Mobile, conducts maritime trade with more than
    125 nations worldwide. The Port of Mobile, which consistently ranks in
    the top 15 deep water Ports in the Untied States, annually services an
    equal proportion of domestic and foreign cargoes.
        The Alabama State Docks, a state owned revenue based business,
    serves as the local cost-sharing partner of the Mobile Harbor Federal
    Project. A recent analysis of the impact of the State Docks on the
    State of Alabama identified that every county in the state benefited
    from the services provided by the Port of Mobile. The analysis
    identified approximately 120,000 employees statewide that benefit
    directly and indirectly from the State Docks. Wages received by these
    employees were estimated at over $3 billion. Therefore, it is easily
    understood why full and timely support by the U.S. Army Corps of
    Engineers in its navigation operations and maintenance programs for
    Mobile is critical to the state's economy.
        For the past several years, our communications with your committee
    have portrayed a solid partnership with the Corps in maintaining a
    highly functional project. This has been possible not only because of
    the federal funding provided, but also because of the Port's
    willingness to modify operational procedures when less than full
    project dimensions exist. Our communications have also noted the risk
    of hurricanes to the project. Unfortunately, in the last eighteen (18)
    months, the Port has experienced two hurricanes. When combined with
    less than full dimensions at the time of the most recent storm, severe
    shoaling of the project resulted. The Port has been operating at a
    significantly reduced capacity for the last six months and recovery is
    not anticipated for the next four to six months. The last time such
    conditions existed was in 1979 when a more severe hurricane hit the
    Port. As a matter of history, it only took three months to restore the
    Port to full operation on that occasion.
        The Administration's budget for fiscal year 2000 identifies $17.562
    million for operation and maintenance of the Mobile Harbor Federal
    Project. The average annual expenditure for the past three fiscal years
    has been approximately $20.133 million. The proposed budget will once
    again place the project in a state of risk in the event of another
    hurricane. Therefore, it is requested that $20,812,000 be appropriated
    for the Mobile Harbor Federal Project for fiscal year 2000. This amount
    also includes $750,000 in Construction General funds required to
    evaluate future operational expansion requirements.
        As addressed earlier, approximately one half of the cargo
    transiting the Port of Mobile is domestic. This cargo flows through
    Mobile as a result of the existence of six waterway systems servicing
    Alabama, the southern United States and the states bordering the Gulf
    of Mexico. Again, the economic viability of this region and its ability
    to compete in both the domestic and world market place is dependent
    upon the Corps of Engineers navigation operation and maintenance
    programs. Therefore, we request that your committee support these
    waterway systems at the levels indicated.

    Coosa-Alabama...........................................  $31,556,000.00
    Tennessee-Cumberland....................................  $38,320,000.00
    Tennessee-Tombigbee.....................................  $23,900,000.00
    Appalachicola-Chattahoochee-Flint.......................   $7,510,000.00
    Black Warrior-Tombigbee.................................  $19,250,000 00
    Gulf Intercoastal Waterway..............................         ( \1\ )

    \1\ As requested by GICA.

        Your consideration and support is greatly appreciated.
                                     ______

     Prepared Statements and Letters Supporting Appropriations Request for
        Fiscal Year 2000 for Projects on the Alabama-Coosa River System
     Prepared Statement of Ralph O. Clemens, Jr., President, Coosa-Alabama
                      River Improvement Association, Inc.
                                    summary
        Mr. Chairman & distinguished Committee members: This statement
    includes the following:
        (A) A plea to recognize and maintain our Nation's inland waterways
    system as a vital part of the national transportation infrastructure;
        (B) A request for support in the following areas:
        (1) O&M funding for federal projects in the Coosa-Alabama Basin as
    well as Mobile Harbor;
        (2) Funding for feasibility phase investigation of alternatives to
    improve the reliability of the navigation channel below Claiborne Dam
    on the Alabama River;
        (3) Reopening the Coosa Navigation Project;
        (4) Resisting any attempt to raise user fuel tax on the Inland
    River navigation industry;
        (5) Supporting the Sturgeon Conservation Plan in the Mobile River
    Basin as developed by the Alabama-Tombigbee River Coalition and the
    Fish and Wildlife Service.
                               expanded statement
        Thank you for the opportunity to present to this Subcommittee my
    perspective on several topics relating to our Nation's waterways system
    in general, and to the Coosa-Alabama River Basin in particular. As
    President of the Coosa-Alabama River Improvement Association, I speak
    for a large and diverse group of private citizens and political and
    industrial organizations that sees the continued development of the
    Coosa-Alabama Waterway as an opportunity for economic growth in our
    region as well as the Nation.
        Our membership reflects a broad range of callings and professions,
    including shippers and tow operators, businessmen, bankers and private
    individuals who have a stake in future economic development for their
    firms and successors to enjoy. Then there is a larger group of elected
    officials and their constituents typical of the twenty-three
    municipalities and nineteen counties along the waterway who are members
    of this association. Spurred by a desire to promote economic growth
    through enhanced waterway transportation, these members work diligently
    to develop our waterway into a productive part of the river
    infrastructure of the State and Nation.
        We are concerned about the deteriorating waterway infrastructure
    throughout the nation. Our inland waterways are vital to this Nation's
    welfare. America's ports, navigable waterways, flood protection, water
    supply, environmental restoration, hydroelectric, and other water
    resources programs enhance economic development, national security, and
    general well being. These programs serve the national interest in
    countless ways, returning far more in public benefits than they cost. A
    top-notch navigation system able to meet the demands of both domestic
    and international commerce is a driving force behind the national
    economy, transporting annually almost 15 percent of the nation's
    commodities, one out of every eight tons. The waterways are vital to
    our export and import capability, linking our producers with consumers
    around the world. It is incumbent upon the Federal Government to
    maintain and improve this system of interstate commerce. Therefore, we
    ask Congress to appropriate enough funds for required maintenance and
    construction to keep the waterways the economic multiplier it is. The
    Civil Works budget in fiscal year 2000 must be approximately $4.7
    billion to maintain the system and allow for modest growth. The Federal
    government must make this commitment to improve the water
    transportation network or risk facing serious economic consequences and
    jeopardizing tremendous public benefits.
        Some think tanks are advocating turning the Corps of Engineers'
    Civil Works Program over to state or private managers. We urge caution
    and due deliberation in such a move. Having one agency responsible for
    maintaining water projects on the Alabama River, for example, provides
    benefits that can't be measured in dollars and cents. Security,
    responsiveness and historical knowledge are incalculable to users of
    the river. The Corps' experience is a public investment. The O&M
    funding appropriated annually is a public investment. Slashing that
    investment does not automatically translate into private prosperity.
        We are concerned that any budget strategy that reduces funding for
    the operations and maintenance of inland and intracoastal waterways
    will have a detrimental effect on the economic growth and development
    of the river system. We cannot allow that to happen. In the Alabama-
    Coosa River Basin, we must be able to maintain the existing river
    projects and facilities that support the commercial navigation,
    hydropower and recreational activities so critical to our region's
    economy. The first priority then must be the O&M funding appropriated
    to the Corps of Engineers to maintain those projects. Budget requests
    for the individual projects follow:

    ------------------------------------------------------------------------
                                                President's    Association's
                     Project                      budget      budget request
    ------------------------------------------------------------------------
    Alabama-Coosa River, AL \1\(AL River          $5,185,000      $5,185,000
     incl Claiborne L&D)....................
    Miller's Ferry L&D......................       5,560,000       5,560,000
    Robert F. Henry L&D.....................       6,183,000       6,183,000
    Lake Allatoona, GA......................       6,328,000       6,328,000
    Carters Lake, GA........................       8,150,000       8,150,000
    Lower Alabama Navigation Study (AL River         150,000         150,000
     south of Claiborne) feasibility study..
                                             -------------------------------
          Totals............................      31,556,000      31,556,000
    ------------------------------------------------------------------------
    \1\ Includes dredging from the mouth of the Alabama River through
      Claiborne L&D to Miller's Ferry. Coosa River not included.

        We also support funding O&M for Mobile Harbor at $20,200,000, an
    increase of $3,038,000 over the President's Budget amount of
    $17,162,000. The $20.2 million represents an historical average of
    costs just to maintain the Harbor and does not include funding for new
    construction. We cannot allow Mobile Harbor infrastructure to
    deteriorate because not enough funds were appropriated.
        To attract new business into the Alabama River Basin, we must
    improve the infrastructure of the river itself, specifically the
    navigational reliability below Claiborne Dam. Increased reliability is
    the only way prospective investors will entertain establishing an
    industry that uses river transportation. The Corps of Engineers
    currently maintains 65-70 percent reliability through training dikes,
    reservoir management, and dredging. Of these measures, dredging is the
    most effective, but we can do more.
        The most affordable and most environmentally friendly solution to
    increasing navigation reliability on the Lower Alabama River is to
    improve the training dikes. (Training dikes are levees or barriers
    built out from river banks to direct the water flow into the navigation
    channel, thus aiding in scouring the bottom and decreasing dredging
    costs.) Mobile District has begun a feasibility study to determine the
    interest of the Federal Government in such a project. Without an
    improvement in the navigation reliability on the Lower Alabama River,
    we cannot hope to attract new river-related industry into the Basin. We
    ask Congress to appropriate $150,000, as requested, to enable the
    Mobile District to continue the feasibility study already underway.
        A major objective of our association is to complete a navigable
    waterway from Mobile to Rome, Georgia. The history of the Coosa River
    Project is well known by this committee, but the proposal reflects our
    emphasis on infrastructure investment and the creation of jobs and
    economic opportunity throughout our region. The Pre-design Engineering
    Surveys are complete, so one of the most time-consuming requirements of
    the project is done. We are well aware of the restrictive funding for
    such an undertaking in the current environment, but ask the Committee
    to recognize that a Coosa-Alabama waterway would be one of the largest
    and most rapid generators of jobs currently available. We owe it to the
    people of the Coosa-Alabama River Basin, the states of Alabama and
    Georgia, and the entire region to maintain the vision of completing
    this waterway.
        Another mechanism to make the river system attractive to potential
    users is to keep the cost of shipping via waterways down. The
    President's Budget for fiscal year 2000 does not currently include a
    proposal to increase a user's fuel tax, but some in the administration
    think such a tax is a good idea. We have in the past listed some of the
    negative aspects of such a proposal. Suffice it to say here that an
    increase in user fuel tax will have detrimental effect in the short run
    on consumer prices and trade balance, and in the long run on the
    federal-private partnership and maintenance of the waterways system. As
    one of the most efficient modes of transportation this country
    possesses, the waterway system needs more incentives for investment,
    not obstacles and disincentives.
        The last issue I wish to address is a plea based on our experiences
    over the past several years with attempts by the Fish and Wildlife
    Service to list the Alabama Sturgeon as endangered under the Endangered
    Species Act of 1973. As you know, in December of 1994, the Secretary of
    Interior, Mr. Babbitt, decided not to list the Alabama Sturgeon, citing
    a lack of scientific evidence that the fish was a separate and distinct
    species or even currently existed in the habitat scrutinized. Now, the
    Fish and Wildlife Service sees fit to again propose listing the fish,
    despite a clear alternative to saving the fish that has been underway
    for several years now, an alternative outside the confining
    restrictions of the Endangered Species Act.
        The Fish and Wildlife Service, in cooperation with the Alabama-
    Tombigbee River Coalition, developed a Sturgeon Conservation Plan that
    has strong potential to propagate the Sturgeon population in the Mobile
    River Basin. The State of Alabama, charged with the execution of the
    Plan, currently has three sturgeons in a hatchery in Marion, Alabama,
    ready for propagation. Congress has appropriated over one million
    dollars to this effort so far. Listing the fish as an endangered
    species under the ESA means the sturgeon would have to compete with
    other listed species for money to complete a recovery plan,
    jeopardizing funding already available as well as the work done on the
    Conservation Plan to this point. We strongly support the Sturgeon
    Conservation Plan as an example of the compromise required in the
    environment-economic debate. We ask the Congress to fully fund and
    support the Sturgeon Conservation Plan as the best way to save sturgeon
    in the Mobile River Basin.
        In summary, we request your support in the following areas:
        (1) Sufficient funding of the US Army Corps of Engineers Civil
    Works budget to maintain and enhance the U.S. inland waterways system;
        (2) O&M funding for the Coosa-Alabama Basins and Mobile Harbor;
        (3) Funding for investigating the feasibility of improving the
    reliability of the navigation channel below Claiborne Dam on the Lower
    Alabama River;
        (4) Reopening the Coosa Navigation Project;
        (5) Resisting any attempt to raise user fuel tax on the Inland
    River navigation industry;
        (6) Supporting the Sturgeon Conservation Plan as developed through
    the cooperative efforts of the Alabama-Tombigbee River Coalition and
    the Fish and Wildlife Service.
        Thank you for allowing us to present our views and for your strong
    support of the Nation's waterways.
                                     ______

     Prepared Statement of Phillip A Sanguinotti, President, The Anniston
                               Star, Anniston, AL

        As a part of a collective effort to maintain and extend the Coosa-
    Alabama waterway, I wholeheartedly support the Coosa-Alabama River
    Improvement Association's funding request for fiscal year 2000.
        I strongly believe in and support the regional effort to improve
    and extend the Coosa-Alabama Waterway. This would include improving the
    navigational reliability below Claiborne Dam, maintaining and improving
    training works and dredging, which would enhance economic development
    of the river basin between Mobile and Montgomery.
        Also, I believe that lowered freight rates would provide a better
    export market, thus helping the trade business. I also urge the Senate
    to support the Interstate Compacts to resolve the two-basin water
    disputes among Alabama, Georgia and Florida, as well as amend the
    Endangered Species Act to include reasonable, balanced measures between
    environmental concerns and economic development.
        Any support you and your committee can give the Association will be
    greatly appreciated by everyone involved.
                                     ______

      Prepared Statement of Otha Lee Biggs, Judge of Probate & President,
                   Monroe County Commission, Monroeville, AL

        The Monroe County Commission, Monroe County, Alabama, respectfully
    request support for the President's Budget for funding of River
    Projects in the Alabama-Coosa River Basin for fiscal year 2000, in the
    amount of $31.556 million as well as $20.2 million for Mobile Bay.
        There is great economic need to improve and extend the Coosa-
    Alabama Waterway System from Rome, Georgia to the Port of Mobile.
    Included in the funding request is $150,000.00 for the second year of a
    feasibility study of ways to improve the navigational reliability below
    the Claiborne Lock & Dam which is the first Dam along the Alabama-Coosa
    River System and is located in Monroe County, Alabama. Unless
    navigational reliability is stabilized from below the Claiborne Lock &
    Dam to the Port of Mobile, the full and positive economic benefits
    cannot be realized in the Southeastern part of the United States. One
    mile from the Claiborne Lock & Dam is located the largest Pulp and
    Paper complex of its kind in the world and the efforts of your Senate
    Subcommittee on Appropriations for Energy and Water Development in the
    past toward the development of this great waterway system was
    instrumental in bringing this $1.5 billion investment to Monroe County,
    Alabama, as well as other major industries that have located in this
    river basin.
        We again respectfully request approval of the Association's funding
    request for fiscal year 2000.
                                     ______

    Prepared Statement of Sandy Smith, Executive Director, Monroeville Area
                      Chamber of Commerce, Monroeville, AL

        Our organization is in support of the Coosa-Alabama River
    Improvement Association's request for fiscal year 2000 funding.
        We support the regional effort to improve and extend the Coosa-
    Alabama Waterway, and the need to improve the navigational ability
    below the Claiborne Dam.
        Lower freight rates provide a better export market, thus helping
    our area manufacturers. In this regard, we also ask that you provide
    $150,000 in funding for a feasibility study by the Corps of Engineers
    on ways to improve navigation reliability below Claiborne Dam.
        Please support our request! Thank you in advance.
                                     ______

      Prepared Statement of William F. Joseph, Jr., Chairman, Montgomery
                       County Commission, Montgomery, AL

        The Montgomery County Commission has a vital interest in the
    development of the Coosa-Alabama River project which was originally
    authorized by the Congress in 1945. The benefits which accrue to the
    citizens of this region, and to the nation, fully justify the complete
    construction and operation of this economical waterway.
        We fully support the testimony provided by the Coosa-Alabama River
    Improvement Association. For many years this group has represented us
    and they accurately reflect our feelings of support for this waterway
    project.
        Of particular interest to us is funding to operate and maintain
    (O&M) water projects in the Alabama-Coosa River Basin.
        Also, we feel that the requested appropriation to fund a
    feasibility study of ways to improve the navigation reliability below
    Claiborne Dam will enhance the economic development of river basin
    between Mobile and Montgomery. Additionally, we believe that the
    requested appropriation to continue the operation and maintenance of
    the entire system directly relates to lowered freight rates and
    improves the export market and creates a positive improvement on our
    nation's trade balance.
        We urge your favorable consideration of the recommended
    appropriations for fiscal year 2000. Adequate funding as requested is
    necessary to insure that progress is made for further development of
    the system and to properly operate and maintain the existing portion.
    Similar information has been sent to Honorable Randall Packard,
    Chairman, House Subcommittee on Appropriations for Energy and Water
    Development, regarding this matter.
                                     ______

                          Letter From James T. Jordan

                                      J.T. Jordan Cotton, Inc.,
                                            Centre, AL, March 15, 1999.
    Hon. Pete V. Domenici,
    Senate Subcommittee on Appropriations for Energy and Water Development,
    U.S. Senate, Washington, DC.
        Dear Senator Domenici: This letter is to let you know that I
    strongly support the Coosa-Alabama River Improvement Association's
    funding request for fiscal year 2000.
        I also support the regional effort to improve and extend the Coosa-
    Alabama Waterway which needs to be much improved for navigational
    reliability below the Claiborne Dam. There is also a need to maintain
    and improve training works and dredging because the economic
    development of the river basin between Mobile and Montgomery depends on
    these improvements.
        If freight rates are lowered, this will provide a better export
    market, thus helping the trade business.
        I also support funding of $5,185 million for the Alabama-Coosa;
    $6,183 million for RF Henry; and $20.2 million for Mobile Bay.
        Anything you can do to help the above will be very much
    appreciated.
                Sincerely,
                                               James T. Jordan,
                                                       Director, CARIA.
                                     ______

                   Letter From Mayor David D. Whetstone, Jr.

                                            City of Prattville,
                                        Prattville, AL, March 15, 1999.
    Hon. Pete V. Domenici,
    Senate Subcommittee on Appropriations for Energy and Water Development,
    U.S. Senate, Washington, DC.
        Dear Senator Domenici: I write to support the fiscal year 2000
    budget request for continued improvements to the Alabama-Coosa
    Waterway. I have had the pleasure to serve on the Coosa-Alabama River
    Improvement Association (CARIA) for a number of years and have
    personally seen the progress that has been made on this waterway,
    thanks to the support of your subcommittee and subsequent federal
    funding.
        Based on the past improvement efforts, I would urge you and your
    subcommittee to allow the progress to continue with an appropriate
    allocation for fiscal year 2000. We need to improve the navigational
    reliability below Claiborne Dam and we need to maintain and improve
    training works and dredging.
        As Mayor of one of the fastest-growing cities in Alabama, I know
    firsthand how important this river basin is to the continued economic
    development of our State from Mobile to Montgomery. With our City's
    industrial growth, we too are seeing an increased need for improved
    waterway transportation.
        Thank you for your continued support of CARIA and for your
    subcommittee's consideration of the fiscal year 2000 funding request.
                Sincerely,
                                       David D. Whetstone, Jr.,
                                                                 Mayor.
                                     ______

                             Letter From W.O. Pace

                                     Autauga County Commission,
                                        Prattville, AL, March 15, 1999.
    Hon. Pete V. Domenici,
    Senate Subcommittee on Appropriations For Energy and Water Development,
    U.S. Senate, Washington, DC.
        Dear Senator Domenici: This letter is to inform you that the
    Autauga County Commission, Autauga County, Alabama, supports the U.S.
    Army Corps of Engineers request for funding fiscal year 2000 to operate
    and maintain water projects in the Alabama-Coosa River Basin. There is
    a definite need to improve navigation reliability on the lower Alabama
    River for economic development reasons, i.e., decreasing tonnage on the
    river because of the meandering of the river, sharp turns and low water
    below Claiborne Dam; also, there has been a dearth of industries
    seeking to relocate within the River Basin. Therefore, we need to
    improve the navigational reliability below Claiborne Dam and maintain
    and improve training works and dredging. Economic development between
    Montgomery and Mobile depends on these improvements. The Corps is able
    to maintain an authorized nine foot channel 65 to 70 percent of the
    time, but major problems occur during July through September.
        Barge costs on the Alabama River are higher than other waterways.
    Shippers use barges in one direction only, but pay for travel both ways
    because there is no backhaul available and there is not enough industry
    in the Basin to warrant two-way shipping. Ninety four percent of tons
    moved on the Alabama River are downbound. For these reasons, shippers
    have found other modes of transportation or left the Basin altogether.
        Adding to the costs the shippers have faced are delays caused by
    the shallow water depth. Also, after 1991, environmental attacks on
    sand and gravel businesses shipping by barge were so costly, a lot of
    these businesses closed. Lowered freight rates provide a better export
    market, thus helping the trade business. Waterways provide efficient
    transportation that tends to lower inflation. Congress must support the
    Interstate Compacts to resolve the two-basin water disputes among
    Alabama, Georgia, and Florida. Also, if Congress would amend the
    Endangered Species Act to include reasonable, balanced measures between
    environmental concerns and economic development instead of such
    stringent regulations, this would greatly improve economic development.
        We would sincerely appreciate your help in this matter that is so
    vital to the State of Alabama.
                Sincerely,
                                                     W.O. Pace,
                                   Chairman, Autauga County Commission.
                                     ______

      Prepared Statement of James D. Wallace, President, Selma and Dallas
                     County Chamber of Commerce, Selma, AL

        It is my privilege to represent a rural city and county in Alabama
    which has suffered through many economic nightmares not of their own
    making. So, it is incumbent on me to always seek our projects which we
    believe will be helpful in pulling this area out of its economic
    dilemma and into the mainstream of development.
        Our people are a wonderful, dedicated hardworking lot, but they
    need to have the same opportunities as many of the much more developed
    areas of these United States.
        One of our hopeful signs through the years has been the proposed
    development of our waterways not only for industrial tonnage, but also
    for outdoor recreation and the clean economic dollars it brings into a
    community.
        The proposals supported by the Coosa-Alabama River Improvement
    Association are aligned with our thoughts on what will be in the best
    interest of the slow, but continued improvement to our waterways. This
    has been a painfully slow, but ongoing process and we are hopeful that
    Congress will continue to give fiscal support to this area.
        The Coosa-Alabama System forms a corridor from Georgia through
    Alabama, ending up in Mobile Bay. One part of the system is dependent
    on the other so all the pieces of the puzzle are in need of funding
    support.
        We applaud you for supporting us in the past and are hopeful you
    will continue to do so.
                                     ______

      Prepared Statement of Carl Morgan, President, Economic Development
                              Authority, Selma, AL

        We at the Selma and Dallas County Economic Development Authority as
    well as representatives from the city of Selma, Alabama, wish to convey
    our support of the funding request for fiscal year 2000. It is
    imperative to the economy of Alabama that every effort is made to
    improve and extend the Coosa-Alabama Waterway. Enhancing the
    navigational reliability of the waterway below the Claiborne Dam and
    maintenance of the training works and dredging is also vital to the
    economic development of the river basin between Mobile and Montgomery.
        Alabama's waterways have always been of the utmost importance.
    Cahaba, the first capital of the state, was located between two rivers
    and as a result industries who enjoyed this advantage thrived. Although
    over one-hundred and fifty years have passed and steamboats no longer
    traverse the rivers as they once did, Alabama's waterways remain
    crucial to economic development today.
        Within the last six months, businesses which could supply more than
    2,500 jobs to the residents of Dallas County have visited the
    community. One major criterion has continued to be river access in
    relation to any sites under consideration. Several of our existing
    industries utilize the Alabama River on a daily basis and would not be
    able to continue to produce without this resource. For this reason, we
    are asking you to help our residents by voting to approve the funds
    requested and as noted below:

    Alabama-Coosa.................................................    $5.185
    Miller's Ferry................................................     5.560
    RF Henry......................................................     6.183
    Allatoona.....................................................     6.328
    Carter's Lake.................................................     8.150
    Feasibility study of Lower AL River...........................     0.150
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................    31.556

        In addition, we support funding $20.2 million for Mobile Bay.
        Obviously, increased user fees and taxes stifle waterway commercial
    development. Without a doubt, lowered freight rates provide a better
    export market. Ultimately, well-maintained waterways provide efficient
    transportation which then lowers inflation.
        We need this legislation in order to help the citizens of Alabama
    and especially river towns such as Selma survive.
        Thank you for your attention to this matter.
                                     ______

       Prepared Statement of Donald G. Waldon, Administrator, Tennessee-
             Tombigbee Waterway Development Authority, Columbus, MS

        We greatly appreciate the opportunity to submit our recommendations
    concerning the funding needs for the Tennessee-Tombigbee Waterway and
    related projects in fiscal year 2000 for your consideration.
        The Tennessee-Tombigbee Waterway Development Authority is an
    interstate compact comprised of the States of Alabama, Kentucky,
    Mississippi, and Tennessee. Governor Paul Patton of Kentucky is
    chairman of the compact, which promotes and markets the waterway and
    it's economic and trade potential to the region and the nation.
                      tennessee-tombigbee waterway funding
        We are very concerned about the continued deterioration of the
    waterway caused by under funding during the past few years. Over $8
    million of essential and critical repairs to the waterway will be
    indefinitely postponed beyond fiscal year 2000 unless the Congress
    restores the cutback in its funding as proposed by the Administration.
    The following table briefly demonstrates the recent decline in funds
    and shows that amount needed to adequately maintain the waterway.
                            tenn-tom funding history
                                                                    Millions
    1997..........................................................     $22.4
    1998..........................................................      19.5
    1999..........................................................      20.2
    2000 Request..................................................      19.9
    2000 Recommendation...........................................      23.9

        The Authority's recommendation of $23.9 million will fund some $4
    million of important O&M work that will not be accomplished if the
    President's budget is approved. It is most imperative that these
    additional funds are provided to ensure the continued safe and
    efficient operation of the project. The requested increase in funds
    will address the following needs:
      --$1,500,000 for additional dredging and spoil containment to ensure
            unimpeded commercial navigation.
      --$850,000 to help correct a potentially unsafe navigation condition
            at Bevill Lock.
      --$800,000 of additional funds provided to the Alabama and
            Mississippi conservation agencies that are needed to better
            manage some 140,000 acres of federally owned wildlife
            mitigation lands.
      --$750,000 thousand for urgently needed repairs to structures along
            the 234-mile waterway.
        The Corps of Engineers has already undertaken measures to reduce
    operating costs of the waterway. For example, some campgrounds and
    other recreation facilities are now closed earlier in the season
    because of lack of operating funds. It is a travesty to curtail public
    access to these waterway attractions. About $50 million have been
    invested in these facilities that are very popular with the public,
    attracting some 6 million visitors annually. The Tenn-Tom is the 4th
    best Corps project in the nation for generating income from
    recreational use and funding cuts are hurting receipts. Regrettably,
    those revenues collected from recreational users are deposited in the
    Treasury and not provided directly to the waterway to help finance its
    operations.
        Unless the Congress addresses this growing problem of indefinitely
    deferred maintenance and repairs of the Tenn-Tom, the physical
    integrity of the waterway will continue to erode and its ability to
    generate expected economic benefits will greatly diminish. The Congress
    has invested nearly $2 billion in the waterway and non-federal
    interests have committed an additional $4 billion in port facilities,
    industries, and other capital investments on the assumption the federal
    government will fulfill its responsibilities to maintain the project.
    It would be ``penny wise and pound foolish'' not to do so.
        The $500-million Boeing rocket plant now under construction at
    Decatur, AL, must have a dependable and adequately maintained
    navigation channel to ship its rockets for launching. Starting in 2000,
    the rockets will be transported on a specially built ship to launching
    sites in Florida and California via the Tenn-Tom. Boeing officials have
    begun to question the reliability of the waterway because of its under
    funding. The plant will employ some 2,000 workers.
        We, therefore, respectfully request that you and your committee
    approve $23.9 million for the operation and maintenance of the
    Tennessee-Tombigbee Waterway, a budget that will help correct the
    malign neglect of the past that has hurt the waterway's performance.
                                 kentucky lock
        The Authority recommends that $15 million be appropriated in fiscal
    year 2000 for the continued construction of a new lock at Kentucky Dam
    on the Tennessee River. This project is one of the most critically
    needed improvements to the nation's waterway system. The recommended
    funding is necessary to ensure the new lock's completion by 2008 before
    the existing lock is closed for an extended period and commerce is
    halted.
        The existing 60-year old lock is a bottleneck to commerce, costing
    shippers and industries millions of dollars in additional
    transportation costs. The average delay to transit the antiquated lock
    is more than 6 hours. Over 43 million tons of U.S. products and
    commodities pass through this part of the nation's inland waterway
    system each year. The new lock will return $2.50 in economic benefits
    (mainly savings in transportation costs) for each dollar spent. This is
    an excellent investment for the future economy of the nation.
                                chickamauga lock
        We request that $3 million be provided to the Corps of Engineers to
    continue major repairs to the Chickamauga lock and Dam on the Tennessee
    River near Chattanooga. This project is over 50 years old and has
    serious structural problems. The Corps began repairs to the project
    this year that when completed will extend the physical life of the lock
    and dam to about 2010. Without these repairs, the lock will permanently
    close to traffic due to safety precautions in 2005.
        Permanent closure of the lock to commerce would landlock east
    Tennessee, seriously crippling several major industries that are
    dependent on barge transportation and hurting that region's economy.
    According to the U.S. Department of Energy, closing Chickamauga will
    also have significant adverse impacts on national missions conducted at
    its Oak Ridge, Tn. facilities. These repairs will extend the life of
    the antiquated lock until the Congress can decide whether to replace it
    or close the waterway.
        In that regard, we recommend that the Corps be given the necessary
    funds to expeditiously conduct a study of the feasibility of replacing
    this out-moded structure with a new project.
                                 other programs
        In closing, the Authority supports the proposed budget of $7
    million for TVA's management of the Land Between the Lakes recreation
    area. We also support those funds requested for the Appalahian Regional
    Commission, an agency that greatly influences our region's economy and
    quality of life.
        Thank you for your careful consideration of our requests for the
    continued funding of these most important projects and programs.
                                     ______

        Prepared Statement of James H. Hodges, Governor, State of South
                             Carolina, Columbia, SC

        Mr. Chairman and distinguished Members of the Committee; on behalf
    of the citizens of the Palmetto State, thank you for the opportunity to
    submit for the record comments regarding the fiscal year 2000 Water and
    Energy Appropriations Bill.
        I'm extremely proud to report to you that the historical, positive
    partnership South Carolina enjoys with the Federal Government and
    particularly the U.S. Army Corps of Engineers (USAGE), is as strong as
    ever, and if possible, growing stronger. We appreciate your support of
    our efforts to maximize the value of South Carolina's natural
    resources, upon which our state's economic well-being is so very
    dependent.
        Our lakes and reservoirs are critical to hydroelectric power
    production; intracoastal waterways and ports are key economic
    development components; and beaches and shoreline essential to
    recreation and tourism. Protection of the natural environment is key to
    South Carolina's varied ecosystems and habitats, and integral to its
    unspoiled beauty.
        At the outset, I wish to express our gratitude for this Committee's
    interest in, and support of, our prior years' testimonies. With your
    help, South Carolina is moving forward on major USACE projects having
    national implications, such as the deepening and widening of Charleston
    Harbor and the protection of our famous Myrtle Beach Grand Strand area,
    one of America's most popular vacation destinations. While there
    certainly remains work to be done, I am enthusiastically encouraged
    with our ``partnership's'' measurable progress and tangible results.
        Sharing in the nation's current economic prosperity, South Carolina
    is moving ahead with progressive economic development, job creation,
    and environmental protection. We are a leader in the South in terms of
    economic growth, and are below the national average in unemployment
    rate. We are, however, a small state and our relative prosperity is
    very dependent upon funding such as this Appropriations Bill. It's
    obvious that its contents, and the actions of this Committee, have
    widespread implications for the state as a whole.
        With regard to the fiscal year 2000 Energy and Water Appropriation
    Bill specifically, I note with pleasure the relative `health' of this
    Bill as compared to recent years' submissions, particularly funding for
    the Corps of Engineers. My comments for the record reflect input from,
    and the concerns of, the principal State Agencies that work most
    closely with the USACE Charleston District Office; namely the SC State
    Ports Authority; the SC Department of Natural Resources; and the SC
    Department of Health and Environmental Control/Office of Ocean and
    Coastal Resource Management. Attached to my testimony as ``Supporting
    Documents'' are individual descriptions of the approved and on-going,
    USACE projects throughout South Carolina.
        In commenting on this legislation, it's my intention to convey to
    this Committee the value of our partnership, and highlight those areas
    both where we can further the Administration's goals, and where we need
    Federal assistance sustaining critical project/program implementation.
    I'm confident through our mutual support South Carolina will
    effectively cross the ``Bridge to the 21st Century''.
                       south carolina's harbors and ports
        Our significant harbor and port assets continue to be the fuel of
    our economic engine. The great Port of Charleston, a national asset, is
    now in the execution phase of a fully funded, $138.7 million deepening
    and widening project; a project whose reality is the product of this
    Committee's commitment and the state of South Carolina's significant
    investment. The benefits to be realized will transcend the obvious as
    creative collateral activities such as using the dredge material to
    build berms for fish habitat, are pursued; a Win-Win for economists and
    environmentalists alike. Likewise, our smaller, but equally important,
    ports of Georgetown and Port Royal are principal players in the
    industrial shipping arena. Dredging and dike maintenance projects are
    critical to the effectiveness of these waterways, and South Carolina
    stands ready to support any project requirements necessary to utilize
    existing USACE capabilities should additional Federal funds be
    identified. I'll elaborate on this area later.
        I would like to comment on the three principle appropriation
    accounts within the USACE (Civil Works) fiscal year 2000 budget
    proposal that have direct impact on South Carolina and its quality of
    life: General Investigations (Studies); Construction General; and
    Operations and Maintenance (O&M).
                                    studies
        We are appreciative of budgeting provided for general
    investigations related to Congaree, Santee, Cooper, and Yadkin-Pee Dee
    rivers, which are essential to overall water resources evaluation.
    There are, however, two additional reconnaissance studies in need of
    Committee support: the Broad River Basin, NC & SC; and the Charleston
    Harbor Extension (Please note: the Charleston Harbor Extension study
    will require a Committee Resolution for study authorization). The only
    funding required is $100,000 to initiate each study, and the definitive
    insights gained are certainly worth the minimal cost. Study
    descriptions are provided in the Supporting Documents.
        In a related issue, there are growing concerns with regard to
    contamination of sediments in the greater Charleston Harbor and
    Estuary. In a cooperative effort, the University of South Carolina and
    the SC Department of Natural Resources have approached the USACE
    Charleston District Office about conducting such a study in an effort
    to pro-act to the obvious hazard associated with dredging and spoil
    disposal of contaminated sediments. The SC Legislative Delegation has
    keen interest in this initiative, and I am fully supportive of any
    solution that can be implemented to assist in bringing such a study to
    fruition. Your support would be greatly appreciated.
                              construction general
        As alluded to earlier, we are pleased to finally have our major
    Charleston Harbor Deepening/Widening project funded and underway, and
    to be nearing completion of the Myrtle Beach Storm Damage Reduction
    project. Adequate funding is also in place to carry out USACE
    Continuing Authorities Program (CAP) projects. This essential, cost
    shared program, has been, and continues to be, well managed and
    implemented under USAGE Charleston District Office cognizance, as is
    considered by state planners to be invaluable to effective resource
    planning.
        Also funded within the Construction account is the Aquatic Plant
    Control (APC) Program. Control of noxious aquatic plants continues to
    be a matter of serious concern to South Carolina. Productivity of our
    waterways and hydro-electric dams are essential to our economy.
    Millions of dollars have been spent to date to research, eradicate, and
    control destructive weeds in our lakes and reservoirs, and we have made
    measurable progress. The downside is that in order to secure our gains,
    continued control activities must take place or re-growth will occur
    and we'll be back to ``square one''. Unfortunately, despite this
    Committee's adding funds to the Aquatic Plant Control Program last
    year, all of it was funneled into research and none made available to
    states for control activities. Again this year there are no funds in
    the Administration's budget for APC, and I respectfully request you
    reexamine this ``pay me now or pay me later'' scenario, and specify
    $250,000 for South Carolina in order to keep this serious problem at
    bay. Details can be found in the Supporting Documents.
                         operation & maintenance (o&m)
        Nowhere are there greater implications for funding than in the O&M
    account. Maintenance of the nation's navigable waterways and existing
    infrastructure is critical to the economic viability and safety of both
    the State and its citizens. There are shortfalls in the O&M area that I
    would like to highlight and seek your support in alleviating.
        Dredging and Diking are critical to the overall navigability of our
    waterways. Murrells Inlet is home to an active commercial fishing fleet
    and several marinas housing significant numbers of commercial and
    private recreational vessels. Current navigability is being compromised
    due to shoaling and sediment overflow from the upstream deposition
    basin. Inaccessibility of this channel will result in virtual collapse
    of local economic livelihood. This O&M project calls for maintaining .6
    miles of the entrance channel; three miles of inner channel; one
    turning basin; deposition basin; and two stone jetties, but received
    zero funds this year. There has not been dredging activity since 1988
    and there is an immediate need in order to keep the channel at the
    required depth of 12 feet. USAGE capabilities are consistent with the
    estimated $1.48 million project cost, and can support this critical
    activity.
        While Georgetown Harbor has current maintenance funds allocated,
    additional funds are necessary to control harbor depth, which is not an
    activity currently funded. Passage of larger ships is important to the
    harbor's viability and failing to dredge this year will denigrate this
    harbor's capability to support commercial shipping. An estimated $2.8
    million is necessary to restore Georgetown harbor to navigable depth.
        As mentioned earlier, dikes along the Atlantic Intracoastal
    Waterway are in serious disrepair. Existing O&M funds are inadequate to
    accomplish the needed dike repair necessary to ensure adequate dredge
    disposal areas in the near future. $1.5 million is necessary to execute
    minimum dike repair and undertake systematic erosion control.
        Mr. Chairman, in closing, we in South Carolina recognize that
    despite the current positive economic climate and budget surpluses,
    resources are not unlimited and priorities must be established. But
    South Carolina also occupies a unique position in our national
    interest. Key military installations, coastal geography, interstate
    trade routes, and international commerce are all dynamics at work
    within our boarders. We consider ourselves good stewards of taxpayer
    resources and a responsible partner in the prudent expenditure of
    valuable funds. I urge you to favorably consider our reasonable
    requests for fiscal assistance, and furthermore, to think of your
    commitment as an investment, not an expense.
        We look forward to continuing our partnership in the collective
    pursuit of excellence for our deserving constituents.
                                     ______

         Prepared Statement of Cyrus M. Jollivette, Vice President for
                   Government Relations, University of Miami
        Mr. Chairman and Members of the Subcommittee: I am privileged to
    have the opportunity to submit this statement on behalf of Rosenstiel
    School of Marine and Atmospheric Science at the University of Miami in
    Coral Gables, Florida.
        Respectfully, the University, joined by the City of Miami Beach,
    Florida seeks your support for the establishment of a demonstration
    project in Miami Beach which could arrest the continuing problem of
    coastal erosion, particularly in the cities of Miami Beach, Surfside,
    and Bal Harbour, Florida. This demonstration project would focus on the
    12 miles of sandy beaches between Bakers Haulover Inlet and Government
    Cut.
        By the mid-seventies, this beach segment had severely eroded,
    leaving only a small area of dry beach during low water. To prevent
    loss of land and to prevent damage to existing structures from storm
    surge, many of the adjacent properties had to be protected by sea walls
    and revetments. Because of the lack of sufficient dry beach, tourism
    declined, which has adverse effects on the economy of the region.
        To remedy some of these problems, in 1975, the U.S. Army Corps of
    Engineers (ACOE), in partnership with Miami-Dade County, initiated the
    Miami-Dade County Beach Erosion Control and Hurricane Surge Project. At
    that time, Miami-Dade County and the ACOE entered into a 50-year
    contract for the joint management of Miami-Dade's sandy beaches. During
    the period 1979-1982, the ACOE constructed a hurricane dune and
    nourished the beaches between Bakers Haulover Inlet and Government Cut.
    A total of 60 million cubic yards of sand was placed on the beach
    thereby increasing its width to 300 feet. The implementation of the
    beach nourishment has had a tremendously positive effect on the economy
    of the region.
        In judging the performance of the project, it should be realized
    that beach nourishment is a repeat process and, based on experience
    with other beaches, should be carried on the average of every 5 years.
    The Miami Beach Nourishment, has a considerable better track record.
    Only after some 15 years were there areas that needed to be
    renourished. However at this time, 20 years after the start of the
    original nourishment, the beach as a whole has eroded to an extent that
    a large scale renourishment seems unavoidable unless a return to the
    situation in the mid 1970s is accepted. The major problem is where to
    find sand in sufficient quantities to re-supply the beaches, as the
    near-shore deposits of sand which have been the source for the
    nourishment project have been exhausted.
        The erosion along the beaches between Bakers Haulover Inlet and
    Government Cut is not uniform. Since the implementation of the
    nourishment during the period 1979-1982, the northern two-third has
    steadily eroded whereas the southern one-third has accreted.
    Furthermore, in the erosional part there are ``hot spots'' where the
    erosion is much more severe than in others. The reason for this
    situation is not directly obvious and has to do with the local off-
    shore bathymetry, wave climate, and sediment characteristics. In
    addition, Bakers Haulover Inlet plays an important role in the erosion
    along the beaches of Bal Harbor and Surfside. The present shoreline is
    irregular in plain view--rather than a smooth curve between the two
    inlets--and is characterized by indentations and protrusions.
        Although there is some transfer of sand across the inlets, to a
    first approximation the area between the two inlets can be considered a
    self-contained littoral cell. The seaward boundary of that cell is not
    known and the big question is how much sand is lost to the offshore.
    The remaining sand is redistributed in the cell by waves. From a recent
    study, it is known that sand eroded from the northern two thirds of
    beach can be traced to the southern one-third of the beach. Also,
    bathymetric surveys show that the beach does not conform to the
    straight design slope of 1:40. The actual beach slope is gentler and
    the underwater beach shows a bar. This leads to a loss of dry beach.
        As suggested earlier, the causes of the irregular appearance of the
    shoreline, the presence of erosional ``hot spots'' and the shape of the
    beach profile are related to offshore bathymetry, wave climate, and the
    characteristics of the beach sand. Therefore, to identify the cause(s)
    of erosion, to explain the presence of the erosional ``hot spots'' and
    to predict the anticipated beach profile, information is needed on
    bathymetry, wave climate, and sediment characteristics.
        None of this information is in sufficient detail and will require
    measurements, the results of which would be interpreted using computer
    models. Deep-water waves will be carried inshore to calculate the wave
    characteristics at breaking. From this information, long-shore
    currents, sediment transport and changes in bathymetry, including the
    position of the shoreline will be calculated. The measurements will
    allow construction of an improved sediment budget. For this effort, the
    beach would be divided into compartments, both in the long-shore and
    cross-shore direction. The principle of conservation of sand would be
    applied to each compartment, i.e., the rate of change of the sediment
    volume in each compartment would equal the volume of sediment in minus
    the volume of sediment leaving the compartment. Comparison with
    observed changes in bathymetry, including changes in beach profile,
    should identify the causes of erosion and erosional ``hot spots'' as
    well as the shape of the beach profile.
        The City of Miami Beach remains committed to identifying outside
    sources of sand and expediting the evaluation of the environmental,
    physical and economic viability of the potential sources, to ensure
    that sufficient quantities of beach-quality sand are available to
    fulfill future needs. However it is realized that continuing to pump
    sand to the beaches without addressing the underlying causes of
    erosion, will lead to an endless cycle of needing more, increasingly
    expensive sand.
        Another possible solution is to transfer sand from the southern
    accretional part to the northern erosional part of the beach. Recycling
    will reduce the dependence on outside sources of sand.
        Although presently beach nourishment is the accepted way to combat
    erosion, the lack of sand sources requires us to rethink the process.
    It could well be that for Miami Beach a combination of beach
    nourishment and hard structures (e.g., off-shore breakwaters) is a more
    desirable solution. The hard structures would reduce the sand losses
    and more importantly when located properly, would concentrate the sand
    that has eroded from the beaches in places where it can be retrieved by
    dredges.
        The measurements and subsequent analysis referred to in the
    previous section should help to optimize the use of outside sand
    sources and the recycling technique and provide the necessary knowledge
    to properly design combined measures of nourishment and hard
    structures.
        To arrive at a solution to the erosion problem, the City of Miami
    Beach in cooperation with the University of Miami is suggesting a two-
    prong approach consisting of the development of a long-term beach
    management plan and the implementation of two demonstration projects.
        Combating beach erosion takes a regional (the beach area between
    the two inlets) rather than a local (``hot spots'') approach. The first
    order of business in establishing a beach management plan is to
    identify the causes of the beach erosion and to determine whether there
    exists an equilibrium shoreline position and equilibrium beach profile.
    After that the questions of how, where and when to combat erosion can
    be addressed. This includes the question whether hard structures should
    be included. An important item in arriving at answers to these
    questions is the development of an improved sediment budget. In view of
    the necessary field measurements, the development of the beach
    management plan is expected to take 5 years.
        Mr. Chairman, the University of Miami is pleased to be an active
    partner of the City of Miami Beach, Florida in an effort to provide an
    efficient, cost-effective remedy for the continuing coastal erosion
    problems along the southeast Atlantic Coast. We are convinced that the
    results of this proposed demonstration project will make an important
    contribution to gaining a permanent solution to the problem.
        To accomplish this important program the University of Miami seeks
    $2 million from the Energy and Water Development Appropriations
    Subcommittee through the U.S. Army Corps of Engineers. Your support
    would be appreciated, Mr. Chairman. My colleagues and I at the
    University of Miami thank you for the opportunity to present these
    views for your consideration.
                                     ______

                 Prepared Statement of Volusia County, Florida
        On behalf of our citizens and fishermen, Volusia County, Florida,
    is requesting that the Subcommittee appropriate $1,000,000 in fiscal
    year 2000 from the U.S. Army Corps of Engineers (COE) Construction
    account to fund, in part an 1000 foot oceanward extension of the South
    Jetty of the Ponce DeLeon Inlet. This funding is essential to protect
    the Inlet, along with the existing North Jetty and its landward
    extension funded by this committee in fiscal year 1999. A more detailed
    case history and description of the situation and project follow below.
        The Ponce DeLeon Inlet is located on the east coast of Florida,
    about 10 miles south of the City of Daytona Beach in Volusia County.
    The Inlet is a natural harbor connecting the Atlantic Ocean with the
    Halifax River and the Indian River North. The Ponce DeLeon Inlet
    provides the sole ocean access to all of Volusia County. Fishing
    parties and shrimp and commercial fisherman bound for New Smyrna Beach
    or Daytona Beach use the Inlet, as well as others entering for
    anchorage. Nearby fisheries enhanced by the County's artificial reef
    program attract both commercial and sport fisherman. Head boat
    operators also provide trips to view marine life and space shuttle
    launches from Cape Canaveral. In addition, there is a U.S. Coast Guard
    Lifeboat Station on the east shore of the Indian River less than a mile
    south of the Inlet.
        Unfortunately, the Inlet is highly unstable and, despite numerous
    navigation projects, continues to threaten safe passage for the charter
    boat operators and commercial fisherman who rely on the access it
    provides for their livelihood. Recreational boaters and Coast Guard
    operations are also at risk passing through this unstable inlet. The
    shoaling of the channels in the Inlet so restricts dependable
    navigation that the Coast Guard no longer marks the north channel in
    order to discourage its use. The Coast Guard continues to move the
    south and entrance channel markers and provides warnings that local
    knowledge and extreme caution must be used in navigating the inlet.
    More seriously, the Coast Guard search and rescue data for fiscal years
    1981--1995 show that 20 deaths have resulted from vessels capsizing in
    the Inlet, the direct result of the Inlet's instability. 147 vessels
    capsized and 496 vessels ran aground in the Inlet during the same
    period.
        The Federal interest in navigation through the Ponce DeLeon Inlet
    dates back to 1884 and continues to the present. The existing
    navigation project was authorized by the Rivers and Harbors Act of
    1965. The construction authorized by that Act, including ocean jetties
    on the north and south sides of the Inlet, was completed in July 1972.
    It became evident soon after completion of the authorized project that
    the project did not bring stability to the Inlet. A strong northeaster
    in February 1973 created a breach between the western end of the North
    Jetty and the sand spit the Jetty was connected to inside the Inlet.
    The breach allowed schoaling to occur that was serious enough to close
    boat yards and require almost $2 million worth of repairs, including
    extending the western end of the North Jetty.
        Under the existing maintenance agreement entered into upon
    completion of the construction, the COE periodically performs
    maintenance on the Inlet. Maintenance projects have included several
    dredging efforts, adding stone sections to the south side of the north
    jetty, extending the westward end of the North Jetty for the second
    time, and closing the North Jetty weir. The COE's last maintenance was
    dredging, completed on the entrance channel in January, 1990.
        In fiscal year 1998, the COE received a $3,500,000 appropriation
    for emergency maintenance on the North Jetty. Migration of the entrance
    channel undermined the North Jetty, seriously threatening its
    structural integrity. The fiscal year 1998 funds will be used to
    construct a granite rock scour apron for the 500 to 600 feet of where
    the Jetty is undermined.
        In the current fiscal year, the COE received $4,034,000 from the
    Operations and Maintenance account to extend the North Jetty of the
    Inlet landward by 800 feet. This maintenance project is underway and
    intended to be completed as soon as possible to prevent the erosion
    that will cause outflanking of the North Jetty. Continued outflanking
    of the west end of the North Jetty could create a new inlet for the
    Halifax and Indian Rivers resulting in major changes to the Ponce
    DeLeon Inlet. The resultant shoaling of both the north and south
    channels, as well as changes to the entrance channel, would make
    passage through the inlet extremely dangerous and unpredictable.
        Volusia County is requesting that the COE receive the South Jetty
    construction funds in anticipation of the project's authorization in
    the next Water Resources Development Act (WRDA). S. 507, as reported by
    the Senate Environment and Public Works Committee includes a contingent
    authorization for the South Jetty project, estimated to cost
    $5,454,000, of which $2,988,000 allocated to as the federal cost. We
    understand that the South Jetty project is included in the WRDA
    language the House Transportation and Infrastructure Committee is
    currently drafting. We also understand that the Jacksonville District
    Engineer and the Atlanta Division Engineer have forwarded a positive
    recommendation to COE headquarters on the project. The COE anticipates
    that the construction of the jetty extensions will help stabilize the
    Inlet and reduce future maintenance costs.
        The Ponce DeLeon Inlet presents a serious engineering challenge;
    the success of which is measured in terms of human life and vessel
    damage. The existing project has failed to stabilize the Inlet.
    Extending the North Jetty was the first step toward correcting the
    failure and meeting the challenge. Funding the beginning phase of the
    1000 foot oceanward extension of the South Jetty in fiscal year 2000 is
    the next critical step toward providing safe passage for the commercial
    and recreational boaters in Volusia County. In addition, providing
    these funds at this time is likely to prevent the need to a much more
    substantial maintenance project in the near future.
        Thank you for your consideration of this request.
                                     ______

              Prepared Statement of the Seminole Tribe of Florida
        The Seminole Tribe of Florida is pleased to submit this statement
    regarding the fiscal year 2000 budget for the Army Corps of Engineers
    (COE). The Tribe asks that Congress provide $21.1 million in the COE's
    construction budget for critical projects in the Florida Everglades, as
    authorized in section 528 of the Water Resources Development Act (WRDA)
    of 1996. The Tribe's Everglades restoration project on our Big Cypress
    reservation is a highly ranked critical project that the Tribe and the
    COE have worked cooperatively on for over two years. The Tribe's
    critical project includes a complex water conservation plan and a canal
    that transverses the Reservation. The Tribe has invested a significant
    amount of funds to support the conceptual planning and design of this
    project, as well as for the environmental analysis required by federal
    law. The Tribe firmly believes that the federal government should
    provide the funds authorized by WRDA and relied upon by local sponsors,
    including the Seminole Tribe, for Everglades restoration projects that
    will benefit federal lands and the highly sensitive and nationally-
    valued Everglades ecosystem.
        The Tribe's critical project is a part of the Tribe's Everglades
    Restoration Initiative, which includes the design and construction of a
    comprehensive water conservation system. This project is designed to
    improve the water quality and natural hydropatterns in the Big Cypress
    Basin. This project will contribute to the overall success of both the
    federal and the state governments' multi-agency effort to preserve and
    restore the delicate ecosystem of the Florida Everglades. In
    recognition of this contribution, the Seminole Tribe's Restoration
    Initiative has been endorsed by the South Florida Ecosystem Restoration
    Task Force and has been found to be consistent with the recommendations
    of the Governor's Commission for a Sustainable South Florida.
                         the seminole tribe of florida
        The Seminole Tribe lives in the Florida Everglades. The Big Cypress
    Reservation is located in the western basins, directly north of the Big
    Cypress National Preserve. The Everglades provide many Seminole Tribal
    members with their livelihood. Our traditional Seminole cultural,
    religious, and recreational activities, as well as commercial
    endeavors, are dependent on a healthy Everglades ecosystem. In fact,
    the Tribe's identity is so closely linked to the land that Tribal
    members believe that if the land dies, so will the Tribe.
        During the Seminole Wars of the 19th Century, our Tribe found
    protection in the hostile Everglades. But for this harsh environment
    filled with sawgrass and alligators, the Seminole Tribe of Florida
    would not exist today. Once in the Everglades, we learned how to use
    the natural system for support without harm to the environment that
    sustained us. For example, our native dwelling, the chickee, is made of
    cypress logs and palmetto fronds and protects its inhabitants from the
    sun and rain, while allowing maximum circulation for cooling. When a
    chickee has outlived its useful life, the cypress and palmetto return
    to the earth to nourish the soil.
        In response to social challenges within the Tribe, we looked to our
    Tribal elders for guidance. Our elders taught us to look to the land,
    for when the land was ill, the Tribe would soon be ill as well. When we
    looked at the land, we saw the Everglades in decline and recognized
    that we had to help mitigate the impacts of man on this natural system.
    At the same time, we acknowledged that this land must sustain our
    people, and thereby our culture. The clear message we heard from our
    elders and the land was that we must design a way of life to preserve
    the land and the Tribe. Tribal members must be able to work and sustain
    themselves. We need to protect the land and the animals, but we must
    also protect our Tribal farmers and ranchers.
        Recognizing the needs of our land and our people, the Tribe, along
    with our consultants, designed a plan to mitigate the harm to the land
    and water systems within the Reservation while ensuring a sustainable
    future for the Seminole Tribe of Florida. The restoration plan will
    allow Tribal members to continue their farming and ranching activities
    while improving water quality and restoring natural hydroperiod to
    large portions of the native lands on the Reservation and ultimately,
    positively effecting the Big Cypress National Preserve and Everglades
    National Park.
        The Seminole Tribe's project addresses the environmental
    degradation wrought by decades of federal flood control construction
    and polluted urban and agricultural runoff. The interrupted sheet flow
    and hydroperiod have stressed native species and encouraged the spread
    of exotic species. Nutrient-laden runoff has supported the rapid spread
    of cattails, which choke out the periphyton algae mat and sawgrass
    necessary for the success of the wet/dry cycle that supports the
    wildlife of the Everglades.
        The Seminole Tribe designed an Everglades Restoration project to
    allow the Tribe to sustain ourselves while reducing impacts on the
    Everglades. The Seminole Tribe is committed to improving the water
    quality and flows on the Big Cypress Reservation. We have already
    committed significant resources to the design of this project and to
    our water quality data collection and monitoring system. We are willing
    to continue our efforts and to commit more resources, for our cultural
    survival is at stake.
                 seminole tribe's big cypress critical project
        The Tribe has developed a conceptual water conservation plan that
    will enable us to meet new water quality standards essential to the
    cleanup of our part of the Everglades ecosystem and to plan for the
    storage and conveyance of our water rights. The Tribe's Everglades
    Restoration Initiative is designed to mitigate the degradation the
    Everglades has suffered through decades of flood control projects and
    urban and agricultural use and ultimately to restore the nation's
    largest wetlands to a healthy state.
        The Seminole Tribe critical project provides for the design and
    construction of water control, management, and treatment facilities on
    the western half of the Big Cypress reservation. The project elements
    include conveyance systems, including major canal bypass structures,
    irrigation storage cells, and water resources areas. This project will
    enable the Tribe to meet proposed numeric target for low phosphorus
    concentrations that is being used for design purposes by state and
    federal authorities, as well as to convey and store irrigation water
    and improve flood control. It will also provide an important public
    benefit: a new system to convey excess water from the western basins to
    the Big Cypress National Preserve, where water is vitally needed for
    rehydration and restoration of lands within the Preserve.
                                   conclusion
        Improving the water quality of the basins feeding into the Big
    Cypress National Preserve and the Everglades National Park is vital to
    restoring the Everglades for future generations. By granting this
    appropriation request, the federal government will be taking a
    substantive step towards improving the quality of the surface water
    that flows over the Big Cypress Reservation and on into the delicate
    Everglades ecosystem. Such responsible action with regard to the Big
    Cypress Reservation, which is federal land held in trust for the Tribe,
    will send a clear message that the federal government is committed to
    Everglades restoration.
        The Seminole Tribe is ready, willing, and able to begin work
    immediately. Doing so will require substantial commitments from the
    Tribe, including the dedication of over 2,400 acres of land for water
    management improvements included in the critical project. However, if
    the Tribe is to move forward with its contribution to the restoration
    of the South Florida ecosystem, a substantially higher level of federal
    financial assistance will be needed as well.
        The Tribe has demonstrated its economic commitment to the
    Everglades Restoration effort; the Tribe is asking the federal
    government to also participate in that effort. This effort benefits not
    just The Seminole Tribe, but all Floridians who depend on a reliable
    supply of clean, fresh water flowing out of the Everglades, and all
    Americans whose lives are enriched by this unique national treasure.
        Thank you for the opportunity to present the request of the
    Seminole Tribe of Florida. The Tribe will provide additional
    information upon request.
                                     ______

             Prepared Statement of the City of Miami Beach, Florida
        The City of Miami Beach appreciates the opportunity to submit for
    the record (1) testimony on an innovative new beach erosion control
    initiative, and (2) testimony in support of the request by Miami-Dade
    County for beach renourishment funds.
                     coastal erosion prevention initiative
        The City of Miami Beach, Florida, in conjunction with the
    University of Miami seeks your support for the establishment of a
    demonstration project in Miami Beach which could arrest the continuing
    problem of coastal erosion, particularly in the cities of Miami Beach,
    Surfside, and Bal Harbour, Florida. This demonstration project would
    focus on the 12 miles of sandy beaches between Bakers Haulover Inlet
    and Government Cut Inlet.
        By the mid-seventies, this beach segment had severely eroded,
    leaving only a small area of dry beach during low water. To prevent
    loss of land and to prevent damage to existing structures from storm
    surge, many of the adjacent properties had to be protected by sea walls
    and revetments. Because of the lack of sufficient dry beach, tourism
    declined, which has adverse effects on the economy of the region.
        To remedy some of these problems, in 1975, the U.S. Army Corps of
    Engineers (ACOE), in partnership with Miami-Dade County, initiated the
    Miami-Dade County Beach Erosion Control and Hurricane Surge Protection
    Project. At that time, Miami-Dade County and the ACOE entered into a
    50-year contract for the joint management of Miami-Dade's sandy
    beaches. During the period 1979-1982, the ACOE constructed a hurricane
    dune and nourished the beaches between Bakers Haulover Inlet and
    Government Cut. A total of 20 million cubic yards of sand was placed on
    the beach thereby increasing its width to 300 feet. The implementation
    of the beach nourishment has had a tremendously positive effect on the
    economy of the region.
        In judging the performance of the project, it should be realized
    that beach nourishment is a repeat process and, based on experience
    with other beaches, should be carried on the average of every 5 years.
    While Miami Beach has had a better track record, the beach as a whole
    has eroded to an extent that a large scale renourishment seems
    unavoidable, in spite of the completion of three renourishment efforts
    over the past 15 years. The major problem is where to find sand in
    sufficient quantities to re-supply the beaches, as the near-shore
    deposits of sand which have been the source for the nourishment project
    have been exhausted.
        The erosion along the beaches between Bakers Haulover Inlet and
    Government Cut is not uniform. Since the implementation of the
    nourishment during the period 1979-1982, the northern two-third has
    steadily eroded whereas the southern one-third has accreted.
    Furthermore, there are ``hot spot areas'' where the erosion is much
    more severe than in others. The reason for this situation is not
    directly obvious and has to do with the local off-shore bathymetry,
    wave climate, and sediment characteristics. In addition, Bakers
    Haulover Inlet plays an important role in the erosion along the beaches
    of Bal Harbor and Surfside. The present shoreline is irregular in plain
    view--rather than a smooth curve between the two inlets--and is
    characterized by indentations and protrusions.
        Although there is some transfer of sand across the inlets, to a
    first approximation the area between the two inlets can be considered a
    self-contained littoral cell. The seaward boundary of that cell is not
    known and the big question is how much sand is lost to the offshore.
    The remaining sand is redistributed in the cell by waves. From a recent
    study, it is known that sand eroded from the northern two thirds of
    beach can be traced to the southern one-third of the beach. Also,
    bathymetric surveys show that the beach does not conform to the
    straight design slope of 1:40. The actual beach slope is gentler and
    the underwater beach shows a bar. This leads to a loss of dry beach.
        As suggested earlier, the causes of the irregular appearance of the
    shoreline, the presence of erosional ``hot spots'' and the shape of the
    beach profile are related to offshore bathymetry, wave climate, and the
    characteristics of the beach sand. Therefore, to identify the cause(s)
    of erosion, to explain the presence of the erosional ``hot spots'' and
    to predict the anticipated beach profile, information is needed on
    bathymetry, wave climate, and sediment characteristics.
        None of this information is in sufficient detail and will require
    measurements, the results of which would be interpreted using computer
    models. Deep-water waves will be carried inshore to calculate the wave
    characteristics at breaking. From this information, long-shore
    currents, sediment transport and changes in bathymetry, including the
    position of the shoreline will be calculated. The measurements will
    allow construction of an improved sediment budget. For this effort, the
    beach would be divided into compartments, both in the long-shore and
    cross-shore direction. The principle of conservation of sand would be
    applied to each compartment, i.e., the rate of change of the sediment
    volume in each compartment would equal the volume of sediment in minus
    the volume of sediment leaving the compartment. Comparison with
    observed changes in bathymetry, including changes in beach profile,
    should identify the causes of erosion and erosional ``hot spots'' as
    well as the shape of the beach profile.
        To arrive at a solution to the erosion problem, the City of Miami
    Beach in cooperation with the University of Miami is suggesting a two-
    prong approach consisting of the development of a long-term beach
    management plan and the implementation of a demonstration project.
        Combating beach erosion takes a regional (the beach area between
    the two inlets) rather than a local approach. The first order of
    business in establishing a beach management plan is to identify the
    causes of the beach erosion and to determine whether there exists an
    equilibrium shoreline position and equilibrium beach profile. After
    that the questions of how, where and when to combat erosion can be
    addressed. This includes the question whether hard structures should be
    included. An important item in arriving at answers to these questions
    is the development of an improved sediment budget. In view of the
    necessary field measurements, the development of the beach management
    plan is expected to take 5 years.
        The City of Miami Beach remains committed to identifying outside
    sources of sand and expediting the evaluation of the environmental,
    physical and economic viability of the potential sources, to ensure
    that sufficient quantities of beach-quality sand are available to
    fulfill future needs. However it is realized that continuing to pump
    sand to the beaches without addressing the underlying causes of
    erosion, will lead to an endless cycle of needing more, increasingly
    expensive sand.
        Another possible solution to be investigated is to transfer sand
    from the southern accretional part to the northern erosional part of
    the beach. Recycling will reduce the dependence on outside sources of
    sand.
        Although presently beach nourishment is the accepted way to combat
    erosion, the lack of sand sources requires us to rethink the process.
    It could well be that for Miami Beach a combination of beach
    nourishment and hard structures (e.g., off-shore breakwaters) is a more
    desirable solution. The hard structures would reduce the sand losses
    and more importantly when located properly, would concentrate the sand
    that has eroded from the beaches in places where it can be retrieved by
    dredges.
        The measurements and subsequent analysis referred to in the
    previous section should help to optimize the use of outside sand
    sources and the recycling technique and provide the necessary knowledge
    to properly design combined measures of nourishment and hard
    structures.
        Mr. Chairman, the City of Miami Beach is pleased to be an active
    partner with the University of Miami in an effort to provide an
    efficient, cost-effective remedy for the continuing coastal erosion
    problems along the southeast Atlantic Coast. We are convinced that the
    results of this proposed demonstration project will make an important
    contribution to gaining a permanent solution to the problem.
        To accomplish this important program the City of Miami Beach seeks
    $2 million from the Energy and Water Development Appropriations
    Subcommittee through the U.S. Army Corps of Engineers.
                  support for miami-dade construction request
        The City of Miami Beach would first like to thank the members of
    the subcommittee for all their efforts in the past to provide support
    for the State of Florida's beaches and in particular, those of Miami
    Beach.
        Beaches are Florida's number one tourist ``attraction.'' Last year,
    beach tourism generated more than $16 billion dollars for Florida's
    economy and more tourists visited Miami Beach than visited the three
    largest national parks combined.
        In addition to their vital economic importance, beaches are the
    front line defense for multi-billion dollar coastal infrastructure
    during hurricanes and storms. When beaches are allowed to erode away,
    the likelihood that the Federal government will be stuck with
    astronomical storm recovery costs is significantly increased. The Army
    Corps of Engineers estimated that more than 70 percent of the damage
    caused to upland properties in Panama City Beach by Hurricane Opal
    could have been prevented if their pending beach renourishment project
    had been completed before the storm.
        The Florida Department of Environmental Protection estimates that
    at least 276 miles (35 percent) of Florida's 787 miles of sandy beaches
    are currently at a critical state of erosion. This includes the entire
    six miles of Miami Beach. As a result of the continuing erosion process
    and more dramatically, recent intense storms which have caused
    tremendous damage to almost all of the dry beach and sand dune
    throughout the middle segment of Miami Beach. Two years ago, most of
    the Middle Beach dune cross-overs were declared safety hazards and
    closed, as the footings of the boardwalk itself were in immediate
    jeopardy of being undercut by the encroaching tides. If emergency
    measures, costing approximately $400,000 had not been taken by the
    City, there would have been considerable risk of coastal flooding west
    of the dune line in residential sections of Miami Beach. As you can
    see, this example points to the commitment we as a beach community have
    to our beaches, but federal assistance remains crucial. While we are
    thankful of the substantial commitment made by the subcommittee in the
    fiscal year 1999 Energy and Water Conference Report, there is still
    much work to be done. Our beaches must be maintained not only to ensure
    that our residents and coastal properties are afforded the best storm
    protection possible, but also to ensure that beach tourism, our number
    one industry, is protected and nurtured.
        In 1987, the Army Corps of Engineers and Metropolitan Dade County
    entered into a fifty year agreement to jointly manage restore and
    maintain Dade County's sandy beaches. Since then, Metropolitan Dade
    County has been responsible for coordinating and funding the local
    share of the cost for the periodic renourishment of our beaches.
        In order to ensure that adequate funding will continue to be
    available, the City of Miami Beach supports and endorses the
    legislative priorities and appropriation requests of Metropolitan Dade
    County, as they relate to the restoration and maintenance of Dade
    County's sandy beaches. Specifically, the City respectfully adds their
    strong support for the efforts of Miami-Dade County and wholeheartedly
    supports their fiscal year 2000 request for $7.3 million in beach
    renourishment funds.
        Your support would be appreciated, Mr. Chairman. The City of Miami
    Beach thanks you for the opportunity to present these views for your
    consideration.
                                     ______

                  OHIO RIVER VALLEY INLAND NAVIGATION PROJECTS
       Prepared Statement of R. Barry Palmer, Executive Director, DINAMO
        Mr. Chairman and Members of the Subcommittee: I am Barry Palmer,
    Executive Director of DINAMO, the Association for the Development of
    Inland Navigation in America's Ohio Valley. DINAMO is a multi-state,
    membership based association of business and industry, labor, and state
    government leaders from throughout the Ohio Valley, whose singular
    purpose is to expedite the modernization of the lock and dam
    infrastructure on the Ohio River Navigation System. Largely through the
    leadership of this subcommittee and the professional efforts of the US
    Army Corps of Engineers, we in the Ohio Valley are beginning to see the
    results of 18 years of continuous hard work in improving our river
    infrastructure.
        Lock and dam modernization at Robert C. Byrd Locks and Dam, Grays
    Landing Locks and Dam, Point Marion Locks, and Winfield Locks are
    largely complete. These projects were authorized for construction in
    the Water Resources Development Act of 1986. The immediate problems
    really are focused on completing in a timely manner lock and dam
    modernization projects authorized by the Congress in subsequent water
    resources development acts. Substantial problems remain for adequate
    funding of improvements at the Olmsted Locks and Dams, Ohio River, IL/
    KY; Lower Monongahela River Locks and Dams 2, 3 & 4, PA; McAlpine Locks
    and Dam, Ohio River, IN/KY; Marmet Lock, Kanawha River, WV; and for the
    Kentucky Locks, Tennessee River, KY. The construction schedules for all
    of these projects have been severely constrained, and we are requesting
    increased funding for these construction projects at an ``efficient
    construction rate.'' Following is a listing of the projects and an
    efficient funding level determined by the US Army Corps of Engineers to
    advance these projects, in order to complete construction by 2008 or
    earlier:
                      recommendations for fiscal year 1999
        1. For the Robert C. Byrd Locks and Dam modification project,
    formerly the Gallipolis Locks and Dam on the Ohio River, OH/WV, about
    $7,150,000 for continued construction.
        2. For the Winfield Lock Replacement on the Kanawha River, WV,
    $1,400,000 for continued construction of the lock and relocations
    related to environmental mitigation.
        3. For the Olmsted Locks and Dam, replacing Locks and Dams 52 and
    53 on the Lower Ohio River, IL/KY, $56,100,000 for continued
    construction of the twin 110 foot  x  1,200 foot locks and design of
    the new gated dam.
        4. For improvements to Monongahela River Locks and Dams 2, 3 & 4,
    PA, $53,00,000 for continued construction of Dam 2, for relocations
    related to the construction project, and continued design of Lock 4.
        5. For the McAlpine Lock Project on the Ohio River, IN/KY,
    $10,800,000 to continue design of the new 110 foot  x  1,200 foot lock
    addition and for continued construction of the new 110 foot  x  1,200
    foot lock.
        6. For the Marmet Lock Replacement on the Kanawha River, WV,
    $11,350,000 for real estate acquisition and for continuing Plans and
    Specifications on the main construction contracts.
        7. For the Kentucky Lock Addition on the Tennessee River, KY,
    $15,000,000 to continue design on the new highway and bridge work and
    for relocation and construction of the TVA tower.
        8. For the Ohio River Mainstem Study, including studies related to
    modifications of John T. Myers, Greenup, Emsworth, Dashields, and
    Montgomery Locks and Dams, $9,600,000. This level of funding is needed
    to complete for WRDA 2000 and WRDA 2002, respectively, the studies
    leading to interim feasibility reports (construction authorization
    documents) for additional capacity at these five lock and dam
    locations. Also the Corps of Engineers needs additional funding to
    complete the Ohio River Main Stem Study to determine where additional
    improvements may be needed in future years on the Ohio River Navigation
    System.
        For the five projects identified in Points 3-7, the fiscal year
    2000 Civil Works Budget of the US Army Corps of Engineers allocates
    only $70,584,000, when the ``efficient'' construction level for fiscal
    year 2000 identified by the Corps is $146,250,000. This difference is
    that an additional $75 million for these five projects is needed in
    fiscal year 2000. Attached is a chart outlining fiscal year 1998 and
    fiscal year 1999 appropriations, fiscal year 2000 budget requests by
    the Administration, and fiscal year 2000 efficient funding levels for
    Ohio Valley lock and dam modernization projects. The information
    related to efficient funding levels was provided to DINAMO by the
    Commander, Great Lakes and Ohio River Division, US Army Corps of
    Engineers.
        Completion dates for the Lower Mon project have been delayed 7
    years from 2003 to 2010. For McAlpine Lock the completion date has been
    delayed five years from 2002 to 2007. The current completion date for
    the Marmet Lock project is 2009, but this project with adequate funding
    could be completed two years ahead of current schedule and fully
    operational in 2006. For the Kentucky Lock addition, we have seen three
    different construction schedules. Two completion date schedules would
    complete this project in 2012 or in 2017. In fact if the Kentucky Lock
    project was on an ``efficient,'' or ``optimum'' schedule, the project
    could be completed by 2008.
        All of these construction projects, in addition to the Olmsted
    Locks and Dam, could be completed by 2008 or earlier. Also, monies from
    the Inland Waterways Trust Fund could finance 50 percent of the costs
    of these projects while keeping the Trust Fund in the black.
    Additionally it should be noted that there are about $340 million in
    the Inland Waterways Trust Fund. The real challenge then is to complete
    these lock and dam construction projects by 2008 or earlier by putting
    them on an ``efficient'' construction schedule.
        Delaying the construction of these vitally needed infrastructure
    investments is a terribly inefficient practice. Inefficient
    construction schedules cost people a lot of money. A recent study by
    the Institute for Water Resources concluded that $1.02 billion of
    cumulative benefits (transportation savings) for the aforementioned
    five lock and dam modernization projects on the Ohio River Navigation
    System and the Inner Harbor project in New Orleans harbor on the Lower
    Mississippi River have been lost forever. The benefits foregone
    represent the cumulative annual loss of transportation cost savings
    associated with postponing the completion of these projects from their
    ``optimum,'' or ``efficient'' schedule. In addition, this study
    concludes that $682 million of future benefits that will be foregone
    based on fiscal year 1999 schedules could be recovered if funding is
    provided to accelerate design and construction activities in accordance
    with ``efficient'' schedules.
        Expenditures for lock and dam modernization are an investment in
    the physical infrastructure of this nation. The Corps of Engineers
    construction budget of $1.24 billion for fiscal year 2000 is about $300
    million less than the $1.52 billion Congress provided for fiscal year
    1999. Mr. Chairman, we have great confidence in the Corps of Engineers
    and urge your support for a funding level more in line with the real
    water resources development needs of the nation. For lock and dam
    modernization on America's inland navigation system, targeted
    construction funding ought to be at a level of about $250-300 million
    annually. Last year Congress provided about $4.1 billion for the Corps
    of Engineers program and about $125 million for lock and dam
    modernization on America's inland navigation system. It is reasonable
    that funding for the Corps program should be increased to levels closer
    to $4.4 billion. With this kind of increased funding, as amply
    supported in both the House and Senate appropriations committee report
    language last year, it is clear that a national lock and dam
    modernization program could be sustained at a level commensurate with
    the needs for improving the nation's inland navigation system.
        We thank you for the opportunity to present this request and our
    thoughts on these matters.

                       FISCAL YEAR 2000 FUNDING OF OHIO VALLEY LOCK AND DAM MODERNIZATION PROJECTS
    ----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year--
                                                 ---------------------------------------------------
                                                   1998 Energy &    1999 Energy &                       Funding at
                                                       Water            Water                        Efficient Level
                                                    Development      Development      2000 Budget    of Construction
                                                   Appropriation    Appropriation       Request
                                                        Act              Act
    ----------------------------------------------------------------------------------------------------------------
    Construction:
        Robert C. Byrd Locks & Dam, Ohio River,        $5,356,000       $8,000,000       $7,150,000       $7,150,000
         OH/WV..................................
        Grays Landing Locks and Dam, Monongahela        2,900,000  ...............  ...............  ...............
         River, PA..............................
        Point Marion Locks & Dam................  ...............  ...............  ...............  ...............
        Winfield Locks & Dam....................        8,500,000        4,500,000        1,400,000        1,400,000
        Olmsted Locks & Dam \1\.................       98,400,000       54,500,000       28,634,000       56,100,000
        Locks & Dams 2, 3, & 4 \1\..............       18,200,000       26,500,000       21,600,000       53,000,000
        McAlpine Locks & Dam, Ohio River,  IN/KY        6,720,000        5,300,000        2,800,000       10,800,000
         \1\....................................
        Marmet Locks & Dam \1\..................        1,830,000        6,500,000        9,800,000       11,350,000
        Kentucky Lock Addition, Tennessee River,        4,000,000        8,500,000        7,750,000       15,000,000
         KY \1\.................................
        London Locks & Dam \2\..................        1,000,000  ...............          600,000          600,000
    Surveys: Ohio River Main Stem Study (John T.        8,800,000       10,150,000        7,157,000        9,600,000
     Myers/Newburgh)............................
                                                 -------------------------------------------------------------------
          Totals................................      155,746,000      123,950,000       86,891,000      165,000,000
    ----------------------------------------------------------------------------------------------------------------
    \1\ Targeted priorities by DINAMO.
    \2\ Major rehabilitation of London L/D would require a ``new construction start,'' included in the fiscal year
      2000 budget.

                                     ______

    Prepared Statement of Joseph E. Lema, Vice President, Manufacturers and
                 Services Division, National Mining Association
        The National Mining Association (NMA) urges inclusion of funding in
    the fiscal year 2000 budget for construction and rehabilitation of
    inland waterways navigation lockage facilities at selected sites on the
    Ohio, Monongahela, Kanawha, and Tennessee Rivers, and for expeditious
    completion of the ongoing Ohio River Main Stem Study being performed by
    the U.S. Army Corps of Engineers.
        NMA member companies produce two-thirds of the coal mined in the
    United States and most of the other nonfuel metallic and nonmetallic
    minerals. Producers of coal and many other nonfuel minerals rely on
    safe, efficient, and competitive inland barge transportation services
    for intermodal rail/barge, truck/barge, and conveyor/barge shipments to
    utility plants, agriculture, construction, and metals production sites,
    and port terminals on the Gulf of Mexico from which mining commodities
    are shipped in coastal commerce and international trade.
                               navigation program
        The Ohio River from Pittsburgh to its juncture with the Mississippi
    River at Cairo, Illinois, and the interconnecting Monongahela, Kanawha,
    and Tennessee Rivers are a major component of the nation's bulk freight
    transportation network which links commercial centers in the east and
    the midwest and, through its connections with the Tennessee River and
    the Mississippi River, most of mid-America from the upper east and
    midwest to the Gulf of Mexico. Added to their proven effectiveness in
    carrying bulk commodities, barge operations are fuel efficient and free
    of conflicts with other ground transportation modes, thereby reducing
    emissions which otherwise would be encountered if trucks were to be
    utilized in place of barges resulting in higher levels of traffic
    congestion. One typical barge tow on the Ohio River can accommodate two
    trainloads of coal, and can handle freight tonnage which would require
    900 truck movements, clearly showing the economic and environmental
    advantages of barges.
        Underscoring the importance of moving forward swiftly with
    construction and rehabilitation projects to replace obsolete facilities
    and to increase lockage capacities on the Ohio, Monongahela, Kanawha,
    and Tennessee Rivers is the breakup of Consolidated Rail Corporation
    (Conrail) in 1999 by the purchase of Conrail's trackage by two mega-
    rail-carriers in the east, thereby reducing from three to two the
    number of major, line-haul railroads providing service in the east.
    Railroad restructuring in the east through consolidation of line-haul
    trackage makes the effectiveness of the inland waterways particularly
    strategic and critical as fiscal year 2000 begins.
        From year to year, and currently, NMA has applied a systems
    approach toward analyzing inland waterways problems and needs in our
    appearance before this Subcommittee, NMA's involvement with the Inland
    Waterways Users Board, our communications with representatives of the
    U.S. Army Corps of Engineers, and NMA's participation in meetings with
    shippers, carriers, terminal operators, and others such as the Marine
    Transportation System (MTS) Task Force organized under the leadership
    of the Secretary of Transportation to develop an MTS Strategy for our
    nation. In continuation of NMA's systems approach employed for many
    years of concerted effort in support of assuring the viability of the
    inland waterways system through funding approved by this Subcommittee,
    a process which has demonstrated important benefits by virtue of budget
    approvals by this Subcommittee since the mid-1980's, NMA urges the
    Subcommittee to approve the budget items presented below for funding in
    fiscal year 2000.

    ------------------------------------------------------------------------
                  Budget Item \1\                        Description
    ------------------------------------------------------------------------
    Ohio River Main Stem Systems Study (KY,     Complete feasibility level
     IL, IN, PA, WV and OH), with priorities     engineering designs and
     for John T. Myers, Newburgh, Cannelton,     NEPA studies for priority
     Emsworth, Dashields and Montgomery sites.   lockage improvements, and
                                                 expedite similar activity
                                                 for other sites.
    Marmet Locks and Dam on the Kanawha River   Construction to replace
     (WV).                                       obsolete structure and
                                                 increase lockage capacity.
    Locks and Dams, 2, 3 and 4 on the           Construction to replace
     Monongahela River  (PA).                    three obsolete L&D's with
                                                 two L&D's.
    Kentucky Lock and Dam on the Tennessee      Construction to add a 1,200-
     River (KY).                                 ft  x  110-ft lock chamber.
    Olmsted Locks and Dam on the Ohio River     Construction to replace
     (IL & KY).                                  obsolete L&D's 52 & 53 at
                                                 new L&D site.
    McAlpine Locks and Dam on the Ohio River    Construction of a new,
     (IN & KY).                                  second 1,200-ft X 110-ft
                                                 lock chamber.
    John T. Myers Locks and Dam on the Ohio     Preconstruction engineering
     River (IN & KY).                            and design for addition of
                                                 a second 1,200-ft  x  110-
                                                 ft lock chamber.
    Greenup Locks and Dam on the Ohio River     Preconstruction engineering
     (KY & OH).                                  and design for addition of
                                                 a second 1,200-ft  x  110-
                                                 ft lock chamber.
    London Locks and Dam on the Kanawha River   Major rehabilitation of
     (WV).                                       aging structure.
    ------------------------------------------------------------------------
    \1\ Except for the John T. Myers and the Greenup Locks and Dams, each of
      the budget items presented above presently are authorized. The two
      sites yet to be authorized justifiably warrant addition of second
      1,200-ft  x  110-ft lock chambers to accommodate existing traffic.

        These fiscal year 2000 budget recommendations for navigation
    project construction and rehabilitation arise from a systems approach
    to identification of problems and needs on the Ohio River System
    summarized by the following points:
      --Locks and Dams 2, 3 and 4 on the Monongahela River near Pittsburgh
            typically are transited by commercial barge tows requiring
            passage through each of those sites as they navigate that
            segment of the River, which can be accomplished better by the
            removal of Lock and Dam 3 and uniformly upgrading obsolete
            Locks and Dams 2 and 4.
      --The Marmet Locks and Dam on Kanawha River should have a new 800-ft
            x  110-ft lock to match the new lock built at the Winfield
            Locks and Dam downstream near Charleston to effectively
            accommodate barge tows which originate in the Marmet pool and
            must transit Marmet before arriving at the Winfield site as
            barge tows flow toward the Ohio River.
      --Locks and Dams on the Lower Ohio River below Huntington should have
            twin 1,200-ft  x  110-ft locks to accommodate heavy barge
            traffic characterized by towboats pushing 15 jumbo barges that
            require such lock chambers to transit sites in a single pass
            without breaking up the tow. In addition, the second chamber
            becomes especially critical at times when lock closures are
            required for repair and maintenance operations, leaving a
            single lock in service. For the past 10 years, barge tonnage on
            the Ohio River has increased at an average annual rate of two
            percent, reflecting a 22 percent increase in 1996 over 1986, a
            rate which is expected to continue especially in line with
            growth in the demand for electricity fueled by coal.
      --The Kentucky Lock and Dam should have a new 1,200-ft  x  110-ft
            lock chamber to handle a modern 15-barge tow from the Lower
            Ohio River which must transit the site to proceed on the
            Tennessee River just above Paducah in proximity to the junction
            of the Lower Ohio River and the Tennessee River, matching Ohio
            River locks.
      --The first three locks and dams on the Upper Ohio River below
            Pittsburgh are obsolete, aged and deteriorated, requiring
            modernization through replacement and/or major rehabilitation.
      --The London Locks and Dam on the Kanawha River above the Marmet
            Locks and Dam is aged and deteriorated, requiring early major
            rehabilitation.
      --The Ohio River Main Stem Study underway for several years should be
            expedited at least to the point where interim reports on
            engineering feasibility of improvements at key lock and dam
            sites will be issued in fiscal year 2000, and accompanying
            preconstruction engineering and design work can be initiated
            for priority construction and rehabilitation projects during
            fiscal year 2000 and the years 2000 to 2003.
        The Ohio River System is a principal corridor for distributing coal
    and other commodities via intermodal truck-barge and rail-barge routes
    in eastern and midwestern states. The corridor is especially expansive
    by virtue of the Ohio River's connections with other rivers, in
    particular the Monongahela, Kanawha, Big Sandy, Green, Cumberland,
    Tennessee and Mississippi Rivers, furnishing continuity of barge
    traffic to the southern states and the Gulf of Mexico. Table 1 shows
    how barge freight has been growing on selected rivers in the Ohio River
    System from 1987 to 1996.

                                           TABLE 1.--BARGE FREIGHT TRAFFIC \1\
                                                   [Millions of tons]
    ----------------------------------------------------------------------------------------------------------------
                                                                            Coal                 All Commodities
                                River                            ---------------------------------------------------
                                                                      1987         1996         1987         1996
    ----------------------------------------------------------------------------------------------------------------
    Ohio River Mainstem \2\.....................................          115          134          197          237
    Kanawha River...............................................           12           16           19           25
    Monongahela River...........................................           29           33           33           37
    Tennessee River.............................................           20           18           42           46
    ----------------------------------------------------------------------------------------------------------------
    \1\ Source: Estimated Waterborne Commerce Statistics for Calendar Year 1996, U.S. Army Corps of Engineers,
      October 1997.
    \2\ Includes traffic utilizing all, or part, of the Ohio River. Much Ohio River barge freight traffic originates
      or terminates on other rivers in the Ohio River Basin, including those shown.

        The inland waterways, in particular, the Ohio River and its Ohio
    River Basin tributaries and its waterways connections to points outside
    of the Basin, contribute to many key objectives. They:
      --provide that ``shippers and consumers realize over $2.2 billion
            annually in savings as a result of using the waterways of the
            Ohio River System over more costly modes of transportation''
            Commerce on the Ohio River and Its Tributaries, Ohio River
            Navigation System Report, 1996, U.S. Army Corps of Engineers;
      --are responsive to energy and environmental goals, e.g., ``as a
            consequence of being less energy intensive than other modes, on
            a ton-mile basis water transport also produces less air
            pollution,--and is usually quieter.'' ``The less energy used,
            the less air pollution produced.'' Environmental Advantages of
            Inland Barge Transportation, August 1994, U.S. Department of
            Transportation, Maritime Administration; and,
      --``enhance our Nation's status in relation to international
            commerce, i.e., our ability to compete in the global economy is
            contingent upon our ability to efficiently transport raw and
            finished products and commodities.'' ``We have the best, most
            efficient waterways system in the world.'' Inland Waterways
            Users Board Eleventh Annual Report to the Secretary of the Army
            and the United States Congress, August 1997.
        The replacement of Locks and Dams 52 and 53 with new twin 1,200
    foot  x  110 foot locks at a new site located between the Ohio River
    junctions with the Mississippi River and the Tennessee River will
    reduce the number of controlling lock and dam sites on the Ohio River
    to 20. This will furnish a significant improvement for barge traffic in
    the river segment just above the mouth of the Ohio River. Barge tows
    utilized for moving Ohio River commerce perform most efficiently when
    they consist of 15 barges lashed together with three-barge widths and
    five-barge lengths in tows pushed by towboats. Lock chambers 1,200 feet
    long by 110 feet wide are required in order to accommodate such barge
    tows, enabling single passes by the barge tows through each of the
    sites.
        Barge traffic passing through eight lock and dam projects between
    Huntington, West Virginia and Paducah, Kentucky is exceptionally heavy.
    Of those eight sites, Smithland now has twin lock chambers which are
    1,200 feet by 110 feet and McAlpine is scheduled for similar locks to
    be built under previous project authorization. It is timely to schedule
    construction projects at the remaining six sites in the Lower Ohio
    River, specifically at the J.T. Myers, Newburgh, Cannelton, Markland,
    Meldahl, and Greenup sites, which each have 1,200-foot main chambers
    and 600-foot auxiliary chambers, whereas twin 1,200-foot by 110-foot
    lock chambers are justified in order to accommodate existing and
    projected barge traffic. NMA urges the Subcommittee to consider these
    needs as high priorities for funding navigation construction in fiscal
    year 2000.
                       environmental restoration program
        The NMA is proud of its leadership in initiatives to restore
    ecosystems degraded by mines abandoned prior to the passage of the
    Surface Mining and Reclamation Act. With respect to hardrock mining,
    NMA recently signed a memorandum of understanding with the Western
    Governors Association for the Abandoned Mine Lands Initiative which
    provides an effective framework for partnership for environmental
    restoration between the industry and the states. NMA is pleased that
    the Corps of Engineers is partnering with the Office of Surface Mining,
    other Federal agencies, state agencies, and universities to restore
    streams that have been impacted by acid drainage from abandoned mines.
    The Corps has responded enthusiastically to this mission with the broad
    authority for aquatic ecosystem restoration granted by Section 206 of
    the Water Resources Development Act of 1996 and other project specific
    authorities. Corps partnerships are already working in the Appalachian
    region and new partnerships are forming with state governments for
    restoration of streams in several western states. In H.R. 4060, the
    fiscal year 1999 Appropriations bill (Public Law 105-245), the
    Subcommittee recognized the expertise and capability of the ``the Corps
    to participate meaningfully in acid drainage remediation efforts.''
    Further, the Subcommittee directed the Corps of Engineers to assume a
    participatory role in the National Mine Land Reclamation Center . . .
    ``using available funds and to the extent authorized by law.'' Since
    the enactment of this funding measure, the Corps has not complied with
    this directive. The NMA urges the Subcommittee to pursue this issue
    with the Corps and request a status report on its effort to participate
    in the Acid Drainage Technology Initiative.
                                     ______

               MISSISSIPPI AND LOUISIANA WATER RESOURCE PROJECTS

        Prepared Statement of Donald T. Bollinger, Chairman, Louisiana
                   Governor's Task Force on Maritime Industry
        1. Mississippi River Ship Channel, Gulf to Baton Rouge, LA
    (construction general).--Recommend Corps be funded to full capability
    in fiscal year 2000 to perform required work on the saltwater intrusion
    mitigation plan and complete design studies for potential phase III 55-
    foot channel.
        2. Mississippi River, Baton Rouge to the Gulf, maintenance
    dredging.--Recommend approval of President's fiscal year 2000 Budget of
    $64,430,000 under O&M General to construct new anchorages and maintain
    new and existing anchorages.
        3. Mississippi River Gulf Outlet (MRGO), LA, maintenance
    dredging.--President's fiscal year 2000 Budget is $14,989,000 under O&M
    General. Recommend that Corps be funded increased capability for bank
    stabilization.
        4. Inner Harbor Navigation Canal (IHNC) Lock, LA.--President's
    fiscal year 2000 Budget only includes $13,000,000 in construction funds
    for the IHNC New Ship Lock. Recommend that Corps be funded to full
    capability to continue lock construction and fully fund the community
    impact mitigation plan.
        5. Mississippi River Outlets at Venice, LA.--Recommend approval of
    the President's fiscal year 2000 Budget of $2,743,000 under O&M
    General.
        6. Intracoastal Waterway Locks, LA.--Recommend approval of the
    President's fiscal year 2000 budget of $700,000 in GI funds to continue
    the feasibility study and to develop plans for replacement of Bayou
    Sorrel Lock on the GIWW, Morgan City-to-Port Allen alternate route.
        7. Gulf Intracoastal Waterway, LA and TX.--President's fiscal year
    2000 budget is $12,506,000 under O&M General. Recommend that Corps be
    funded increased capability for a new crane at the IHNC Lock and the
    construction of two miter gates for the Port Allen lock.
        8. Calcasieu Lock, LA.--Recommend approval of President's fiscal
    year 2000 budget of $541,000 in GI funds to continue the feasibility
    phase of the study to replace Calcasieu Lock on the GIWW.
        9. Calcasieu River and Pass, LA.--President's fiscal year 2000
    Budget is $7,560,000 under O&M General. Recommend the Corps be funded
    increased capability to provide additional advanced dredging
    maintenance; to provide rockwork at Dugas Landing; to fully fund
    contracts to dredge the bar channel and miles 5-14; and to renovate
    disposal areas.
        10. J. Bennett Johnston Waterway, Mississippi River to Shreveport,
    LA.--President's fiscal year 2000 Budget is $21,113,000 in Construction
    General and $8,781,000 for O&M General. Recommend that Corps be funded
    to full capability to complete work already under way.
        As Chairman of the Louisiana Governor's Task Force on Maritime
    Industry, I hereby submit testimony to the Senate Subcommittee on
    Energy and Water Development on behalf of the ports on the lower
    Mississippi River, the J. Bennett Johnston Waterway and the Calcasieu
    River waterway and the maritime interests related thereto of the State
    of Louisiana relative to Congressional appropriations for fiscal year
    2000.
        The U.S. Army Corps of Engineers reports that in 1997 a total of
    420.7 million tons of foreign and domestic waterborne commerce moved
    through the consolidated deepwater ports of Louisiana situated on the
    lower Mississippi River between Baton Rouge and the Gulf of Mexico. The
    deepening of this 232-mile stretch of the River to 45 feet has been a
    major factor in tonnage growth at these ports. Thanks to the efforts of
    Congress and the New Orleans District of the Corps, Louisiana's ports
    and the domestic markets they serve can compete more effectively in an
    increasingly global marketplace. Ninety-one percent of America's
    foreign merchandise trade by volume (two-thirds by value) moves in
    ships, and more than 20 percent of the nation's foreign waterborne
    commerce passes through Louisiana's ports. Given the role foreign trade
    plays in sustaining our nation's growth, maintaining the competitive
    posture of Louisiana's ports is essential to our economic well-being.
        In terms of transportation services and global access, Louisiana
    ports enjoy a distinct competitive advantage. Hundreds of barge lines
    accommodate America's waterborne commerce on the lower Mississippi
    River. The high level of barge traffic on the river is indicated by the
    passage of more than 236,000 barges through the Port of New Orleans
    annually. In 1997, 2,371 ocean-going vessels operated by more than 80
    steamship lines serving U.S. trade with more than 150 countries called
    at the Port of New Orleans. The Port's trading partners include: Latin
    America (34.8 percent); Asia (27.5 percent); Europe (26.6 percent);
    Africa (9.5 percent) and North America (1.6 percent). During the same
    year, more than 5,900 vessels called at Louisiana's lower Mississippi
    River deepwater ports.
        While the foreign markets of Louisiana's lower Mississippi River
    ports are worldwide, their domestic market consists primarily of mid-
    America. This heartland region currently produces 60 percent of the
    nation's agricultural products, one half of all of its manufactured
    goods and 90 percent of its machinery and transportation equipment.
        The considerable transportation assets of Louisiana's lower
    Mississippi River ports enable them to play a vital role in the
    international commerce of this nation. In 1997, the region's ports and
    port facilities handled 212 million tons of foreign waterborne
    commerce. Valued at $38.9 billion, this cargo accounted for 18 percent
    of the nation's international waterborne trade and 23.9 percent of all
    U.S. exports. Bulk cargo, primarily consisting of tremendous grain and
    animal feed exports and petroleum imports, made up approximately 92
    percent of this volume. More than 41 million tons of grain from 17
    states, representing 50.9 percent of all U.S. grain exports, accessed
    the world market via the 10 grain elevators and midstream transfer
    capabilities on the lower Mississippi River. This same port complex
    received 82.2 million short tons of petroleum and petroleum products,
    approximately 16 percent of U.S. waterborne imports of petroleum
    products.
        In 1997, public and private facilities located within the
    jurisdiction of the Board of Commissioners of the Port of New Orleans,
    the fourth largest port in the United States, handled a total of 74
    million tons of international cargo worth $18.7 billion (included in
    lower Mississippi River statistics). General cargo totaled 10.3 million
    tons. Although statistically dwarfed by bulk cargo volumes, the
    movement of general cargo is of special significance to the local
    economy because it produces greater benefits. On a per ton basis,
    general cargo generates spending within the community more than three
    times higher than bulk cargo. Major general cargo commodities handled
    at the Port include: iron and steel products; coffee; forest products;
    copper; aluminum products; and natural rubber.
        Fostering the continued growth of lower Mississippi River ports is
    essential to assure the competitiveness of our nation's exports in the
    global marketplace and, consequently, the health of our national
    economy. Assuring deep water access to ports has been a priority of our
    trading partners around the world. Moreover, an evolving maritime
    industry seeking greater economies of scale continues to support
    construction of larger vessels with increased draft requirements.
    Because it facilitated the provision of deepwater port access, passage
    of the Water Resources Development Act of 1986, played a most
    significant role in assuring the competitiveness of ports on the lower
    Mississippi river and throughout the U.S.
        By December, 1994, the Corps completed dredging of the 45-foot
    channel from the Gulf of Mexico to Baton Rouge, LA (Mile 233 AHP).
    Unfortunately, mitigation features associated with the first phase of
    the channel deepening project, completed in 1988, have yet to be
    accomplished. The absence of funding for this vitally important project
    in the President's fiscal year 2000 Budget was most disappointing. We
    urge the inclusion of funding and support for this effort in the
    budget, which will include part of approximately $15 million in
    payments to the State of Louisiana for construction of a pipeline and
    pumping stations to deliver potable fresh water to communities affected
    by saltwater intrusion. We further urge that the Corps be provided
    funding to proceed with design studies for Phase III which will allow
    deepening of the river to the 55-foot authorized depth.
        Along with the Port of New Orleans, the Port of South Louisiana,
    the nation's largest port with 183.6 million tons of foreign and
    domestic cargo in 1997, and the Port of Baton Rouge, the nation's sixth
    largest port with 84 million tons of foreign and domestic cargo in
    1997, and other lower Mississippi River ports are dependent upon timely
    and adequate dredging of Southwest Pass to provide deep draft access to
    the Gulf of Mexico. Based on past experience--spring thaws bringing
    higher river stages and higher siltation rates--we strongly urge full
    funding of the President's fiscal year 2000 Budget amount of
    $64,430,000 under O&M General for maintenance of the 45-foot project
    channel. Funding includes monies for both dredging and repairs to
    foreshore dikes; repairs to lateral dikes; and jetty repairs. Revetment
    construction has reduced the number and size of deep draft anchorages.
    To mitigate this loss, we recommend that the Corps be authorized under
    the O&M General appropriation to construct new anchorages and maintain
    new and existing anchorages to accommodate increased ship traffic.
        Maintenance of adequate depths and channel widths in the
    Mississippi River Gulf Outlet Channel (MRGO) is also of great concern.
    This channel provides deep draft access to the Port of New Orleans'
    principal container terminals and generates an annual economic impact
    of nearly $800 million. In 1997, 530 general cargo vessels calling on
    the MRGO Tidewater facilities accounted for 26.6 percent of the general
    cargo tonnage handled over public facilities at the Port of New Orleans
    and 85.1 percent of Louisiana's containerized cargo.
        Because of the MRGO's demonstrated vulnerability to coastal storm
    activity, annual channel maintenance dredging and bank stabilization
    are essential to assure unimpeded vessel operations. In 1998, heavy
    shoaling related to Hurricane Georges resulted in the imposition of a
    draft restriction from the project depth of 36 feet to 25 feet. The
    President's fiscal year 2000 Budget amount is $14,989,000 under O&M
    General. We, however, strongly recommend that the Corps be funded
    increased capability for north and south bank stabilization projects.
        The Inner Harbor Navigation Canal (IHNC) Lock is a critical link in
    the Gulf Intracoastal Waterway (GIWW), and provides a connection
    between the Port of New Orleans' Mississippi River and IHNC terminals.
    In 1998, the Corps approved a plan for replacement of this obsolete
    facility. The Corps estimates that the lock replacement project will
    have a cost-benefit ratio of 1.7 to one and will provide $110 million
    annually in transportation cost savings. In addition to minimizing
    adverse impacts to adjacent neighborhoods, the project includes a $33
    million Community Impact Mitigation Program. The President's fiscal
    year 2000 Budget amount of $13,000,000 for the IHNC New Ship Lock will
    pay for continued engineering and design work, construction, and
    partial funding of the mitigation program. We, therefore, recommend
    that the Corps be funded to full capability to enable construction and
    mitigation program implementation. In particular, we recommend that the
    mitigation program be fully funded.
        The operation and maintenance of the Mississippi River Outlets at
    Venice, La. are essential to providing safe offshore support access to
    energy-related industries. In 1997, these channels accommodated cargo
    movements exceeding 3.5 million tons. In addition to routine traffic,
    Baptiste Collette Bayou is used by shallow draft vessels as an
    alternate route between the MRGO, GIWW and the Mississippi River. The
    President's fiscal year 2000 Budget amount is $2,743,000 under O&M
    General.
        More than 84.9 million tons of cargo transverse the GIWW in the New
    Orleans District annually. The President's fiscal year 2000 Budget for
    Gulf Intracoastal Waterway, Louisiana and Texas is $12,506,000 under
    O&M General. In addition, we recommend that the Corps be funded
    increased O&M capability for a new crane at the IHNC lock, two miter
    gates at the Port Allen lock and continued maintenance of the Louisiana
    and Texas sections of the GIWW.
        To assure the efficient flow of commerce on the GIWW, approval is
    urged for the President's budget of $700,000 in fiscal year 2000 GI
    funds to continue the feasibility study to develop plans for replacing
    Bayou Sorrel Lock, Morgan City-to-Port Allen alternate route. Also we
    recommend approval of the President's budget of $541,000 in GI funds to
    continue the feasibility phase of the study to replace Calcasieu Lock.
        The Port of Lake Charles, Louisiana, is served by the Calcasieu
    River, which is often below project depth and width. This Port is one
    of Louisiana's major deep-water ports, benefiting the economy of the
    state and the nation. In 1997, the Port handled 33.1 million tons of
    import cargo and 16.7 million tons of export cargo. The Port and
    private facilities along this waterway provide thousands of jobs for
    the Lake Charles area. In 1997, 945 ships and 6,834 barges used the
    Calcasieu River waterway. The Port area's growth and continued success
    depends on the provision of a reliable and safe channel at full project
    dimensions. Project deficiencies necessitate one-way traffic for many
    ships, which results in delays and disrupted cargo operations that are
    costly and inefficient to industry. We request the Corps be funded
    increased capability to provide additional advanced dredging
    maintenance and rockwork at Dugas Landing. In addition, we request full
    funding of contracts to dredge the bar channel, dredge miles 5-14, and
    renovate disposal areas.
        One additional project warrants consideration. The J. Bennett
    Johnston Waterway, Mississippi River to Shreveport, La. Project
    provides 236 miles of navigation improvements, 225 miles of channel
    stabilization works and various recreational facilities. Project
    completion will stimulate economic growth along the Red River Basin and
    increase cargo flows through the deep draft ports on the lower
    Mississippi River. The President's fiscal year 2000 Budget includes
    $21,113,000 in Construction General for substantial project completion
    and $8,781,000 for Operations and Maintenance. We recommend that the
    Corps be funded to full capability for this project.
        The need and impetus to reduce the Federal budget is certainly
    acknowledged; however, reduced funding on any of the above projects
    will result in decreased maintenance levels which will escalate
    deterioration and, ultimately, prevent them from functioning at their
    full authorized purpose. Reduction in the serviceability of these
    projects will cause severe economic impacts not only to this region,
    but to the nation as a whole that will far outweigh savings from
    reduced maintenance expenditures. Therefore, we reiterate our strong
    recommendation that the above projects be funded to their full
    capability.
        Supporting statements from Mr. J. Ron Brinson, President and CEO of
    the Port of New Orleans; Mr. Gary P. LaGrange, Executive Director of
    the Port of South Louisiana, Mr. Roger Richard, Executive Director of
    the Greater Baton Rouge Port Commission, Mr. Glenwood Wiseman,
    Executive Director of the Lake Charles Harbor and Terminal District,
    Mr. Benny Rousselle, President of Plaquemines Parish, Mr. Channing
    Hayden, President of the Steamship Association of Louisiana; Capt. John
    Levine, President of the Associated Branch Pilots and Capt. Mark
    Delesdernier, President of the Crescent River Port Pilots Association
    are attached. Please make these statements along with my statement part
    of the record. Supplemental graphics relating to my statement have been
    furnished separately for staff background use. Thank you for the
    opportunity to comment to the subcommittee on these vital projects.

    Congressional Appropriations for Fiscal Year 2000 for Ports on the Lower
    Mississippi River, J. Bennett Johnston Waterway and Calcasieu River
    Waterway

                                                                   Amount in
                                                     fiscal year 2000 budget
                                                          President's fiscal
            Project                                         year 2000 budget
    Mississippi River Ship Channel Gulf to Baton Rouge, LA.
        (Construction General)..............................................
    Mississippi River, Baton Rouge to the Gulf, Maintenance
        Dredging, & Stabilization (O&M General).............      64,430,000
    Mississippi River-Gulf Outlet (MR-GO), LA. (O&M General)      14,989,000
    Inner Harbor Navigation Canal Lock LA. (Construction
        General)............................................      13,000,000
    Mississippi River Outlets at Venice, LA. (O&M General)..       2,743,000
    Intracoastal Waterway Locks (GI Funds)..................         700,000
    Gulf Intracoastal Waterway LA. & TX. (O&M General)......      12,506,000
    Calcasieu Lock, LA. (GI Funds)..........................         541,000
    Calcasieu River and Pass, LA. (O&M General).............       7,560,000
    J. Bennett Johnston Waterway:
        (Construction General)..............................      21,113,000
        (O&M General).......................................       8,781,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total J. Bennett Johnston Waterway................      29,894,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total.............................................     146,363,000

    Lower Mississippi River--Foreign Waterborne Commerce

                           [Calendar Years: 1985-1997]

                                                                     Percent
    1997..............................................................  18.0
    1996..............................................................  16.6
    1995..............................................................  18.6
    1994..............................................................  17.8
    1993..............................................................  18.1
    1992..............................................................  18.2
    1991..............................................................  16.6
    1990..............................................................  17.6
    1989..............................................................  16.9
    1988..............................................................  15.9
    1987..............................................................  18.2
    1986..............................................................  15.1
    1985..............................................................  14.8

    Source: U.S. Department of Commerce.

                           LOWER MISSISSIPPI RIVER \1\
                              [Calendar year 1997]
    ------------------------------------------------------------------------
                                                             Dollar
                          World Area                         value   Tonnage
    ------------------------------------------------------------------------
    Europe................................................     26.2     20.9
    Asia..................................................     31.6     34.8
    Africa................................................     10.5     12.4
    N. America............................................      0.6      0.7
    Latin America.........................................     31.1     31.2
    ------------------------------------------------------------------------
    \1\ Foreign Waterborne Commerce.

    Lower Mississippi River

                            [In millions of dollars]

            Principal Countries                                 Dollar value
    Japan.........................................................     3,345
    Saudi Arabia..................................................     2,852
    Venezuela.....................................................     2,429
    Mexico........................................................     1,995
    Netherlands...................................................     1,640
    All others....................................................    26,666
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................    38,927
                            [Thousands of short tons]

            Principal countries                                      Tonnage
    Saudi Arabia..................................................    23,975
    Japan.........................................................    19,951
    Venezuela.....................................................    18,380
    Mexico........................................................    15,160
    Colombia......................................................     8,580
    All others....................................................   126,019
                        --------------------------------------------------------------
                        ____________________________________________________

          Total...................................................   212,065

     LOWER MISSISSIPPI RIVER \1\--PRINCIPAL COMMODITIES--CALENDAR YEAR 1997

                                    [STONS]

    Petroleum & Petroleum Products..........................      82,186,500
    Iron & Steel............................................       9,594,101
    Metalliferous Ores......................................       7,168,299
    Fertilizers.............................................       6,648,718
    Nonmetallic Mineral Manuf...............................       2,033,539
    Coal, Coke & Briquettes.................................       1,518,558
    Chemicals...............................................       1,128,575
    All Others..............................................       3,572,351
                        --------------------------------------------------------
                        ____________________________________________________
          IMPORTS TOTAL.....................................     113,850,641
                        ========================================================
                        ____________________________________________________
    Cereal & Cereal Products................................      41,340,365
    Oilseeds & Oleaginous Fruit.............................      20,102,971
    Animal Feeds............................................      13,727,175
    Coal, Coke & Briquettes.................................       7,820,702
    Petroleum & Petroleum Prods.............................       7,019,284
    Chemicals...............................................       2,203,473
    Vegetable Fats & Oils...................................       1,704,335
    All Others..............................................       4,296,467
                        --------------------------------------------------------
                        ____________________________________________________
          EXPORTS TOTAL.....................................      98,214,772

    \1\ FOREIGN WATERBORNE COMMERCE.

    Source: U.S. Department of Commerce.
    ---------------------------------------------------------------------------
    mississippi river gulf outlet facts and comparisons--calendar year 1997
        Responsible for 2.7 million tons of international general cargo.
        Represents 26.6 percent of general cargo handled over public
    facilities at the Port of New Orleans.
        Responsible for 85.1 percent of all container cargo in the State of
    Louisiana.
        Represents approximately 22.3 percent of the Port of New Orleans'
    vessel calls.
        Cargo handled at public facilities via the MR-GO had an estimated
    economic impact of $793 million to the State of Louisiana.
        The economic activity resulting from the MR-GO supported an
    estimated 12,075 jobs in the New Orleans metropolitan area.
        Sources: Port of New Orleans UNO Economic Impact Study.

            Calendar year                                              STONS
    1975.......................................................... 5,386,800
    1976.......................................................... 6,970,600
    1977.......................................................... 8,780,700
    1978.......................................................... 9,411,100
    1979.......................................................... 8,227,200
    1980.......................................................... 5,541,500
    1981.......................................................... 5,794,800
    1982.......................................................... 5,571,800
    1983.......................................................... 5,435,000
    1984.......................................................... 8,034,500
    1985.......................................................... 6,916,000
    1986.......................................................... 8,145,000
    1987.......................................................... 7,703,000
    1988.......................................................... 7,687,000
    1989.......................................................... 7,289,000
    1990.......................................................... 7,059,000
    1991.......................................................... 6,094,000
    1992.......................................................... 6,444,000
    1993.......................................................... 7,160,000
    1994.......................................................... 5,586,000
    1995.......................................................... 5,700,000
    1996.......................................................... 5,042,000
    1997.......................................................... 5,253,000
    [GRAPHIC] [TIFF OMITTED] T10NDP.011

    MISSISSIPPI RIVER GULF OUTLET

                            [1997 Commodity profile]

                                                                     Percent
    Food & Farm Prods.................................................  17.2
    Petro/Petro Prods.................................................   2.2
    Crude Mat'ls......................................................  36.9
    Cola..............................................................   0.2
    Chemical..........................................................  18.9
    All others........................................................   0.2
    Primary Mfgr Goods................................................  16.9
    Mfr Equipment.....................................................   7.6

    Note: Foreign Waterborne Commerce

    Source: U.S. Army Corps of Engrs & Port of New Orleans.
    ---------------------------------------------------------------------------
                                     ______

      Prepared Statement of Channing F. Hayden, Jr., President, Steamship
                            Association of Louisiana
        Summary of testimony of Channing F. Hayden, Jr., President of the
    Steamship Association of Louisiana (formerly known as the New Orleans
    Steamship Association), for the record of the Senate Energy and Water
    Development Subcommittee on fiscal year 2000 Appropriations in
    reference to projects of public interest that affect Louisiana's deep-
    water ports.
        1. MISSISSIPPI RIVER SHIP CHANNEL. GULF TO BATON ROUGE, LOUISIANA
    (CONSTRUCTION GENERAL).--We recommend continuation of the work on the
    saltwater intrusion mitigation plan and the design studies for Phase
    III of the 55-foot channel. Funding to full capability in fiscal year
    2000 is necessary for this required work.
        2. MAINTENANCE DREDGING OF THE MISSISSIPPI RIVER FROM BATON ROUGE
    TO THE GULF OF MEXICO.--We urge approval of the $64,430,000 in the
    President's fiscal year 2000 budget under O&M General.
        3. MISSISSIPPI RIVER-GULF OUTLET MAINTENANCE DREDGING AND BANK
    STABILIZATION.--In addition to the $14,989,000 in the President's
    fiscal year 2000 budget under O&M General, we urge that the Corps be
    funded an increased capability in fiscal year 2000 to maintain this
    channel, which includes bank stabilization on both banks and jetty
    maintenance.
        4. NEW INNER HARBOR NAVIGATION CANAL SHIP LOCK.--Recognizing that
    only $13,000,000 is included in the President's fiscal year 2000 budget
    for construction funds, we urge that the Corps be funded to full
    capability in fiscal year 2000 for this project, which is essential to
    advance the engineering, design, and construction and to continue the
    community impact mitigation plan.
        5. CALCASIEU RIVER AND PASS. LOUISIANA.--We urge approval of the
    $7,560,000 in the President's fiscal year 2000 budget under O&M General
    and recommend that the Corps be funded an increased capability in
    fiscal year 2000 to provide additional advance maintenance dredging, to
    maintain rock protection at Dugas Landing Embankment, as well as fully
    fund contracts to dredge the bar channel, to dredge Miles 5-14, and to
    renovate disposal areas.
        6. J. BENNETT JOHNSTON WATERWAY, MISSISSIPPI RIVER TO SHREVEPORT,
    LOUISIANA.--Recognizing that $21,113,000 is in the President's fiscal
    year 2000 budget to substantially complete this vital project and
    $8,781,000 for O&M in fiscal year 2000, we urge that the Corps be
    funded to full capability for fiscal year 2000. This project will
    result in stimulating economic growth along the Red River Basin and
    increase cargo movements through Louisiana ports. Funding is essential
    to complete the work already under way.
        7. THE PRESIDENT'S PROPOSED HARBOR SERVICE FEE.--We do not support
    the President's proposed fees to replace the Harbor Maintenance Tax.
    The strength of our nation's transportation system is its foreign and
    domestic waterborne commerce. It benefits the entire nation through the
    revenue and jobs it provides the country. Therefore, the maintenance of
    our nation's ports should be handled through the general fund and not
    by placing another tax burden on this vital industry, which serves the
    country well.
        Testimony of Channing F. Hayden, Jr., President of the Steamship
    Association of Louisiana (formerly known as the New Orleans Steamship
    Association), for the record of Senate Energy and Water Development
    Subcommittee on fiscal year 2000 Appropriations in reference to
    projects of public interest affecting Louisiana's deep-water ports.
        Mr. Chairman: I am President of the Steamship Association of
    Louisiana. Our Association represents ship owners, operators, agents,
    and stevedores that represent the majority of the approximately 9,000
    deep-draft vessels in waterborne commerce that call Louisiana's deep-
    water ports each year. We are dedicated to the safe and efficient
    movement of maritime commerce through the state's deep-water ports. We
    endorse the testimony of Mr. Donald T. Bollinger, Chairman of the
    Governor's Task Force on Maritime Industry, and the statements of the
    other organizations attached to his testimony.
        Channel stabilization and maintenance dredging in Southwest Pass
    (SWP) are critical to keep project draft. Project draft ensures the
    Mississippi River's deep-water ports will handle the country's foreign
    and domestic waterborne commerce in the most cost-effective way
    possible.
        For years we have urged this Committee to provide funds to maintain
    project draft at SWP. You have responded, and your wisdom has
    benefitted the entire American heartland served by the Mississippi
    River system. SWP was greatly restricted throughout the 1970s. From
    1970 to 1975, the channel was at less than project draft 46 percent of
    the time. In 1973 and 1974, the channel was below the 40-foot project
    draft 70 percent of the time. During some periods, drafts were limited
    to 31 feet. Fortunately, those conditions heave not recurred because of
    a combination of factors: Your help, and the constant vigilance of the
    Pilots, the Corps, and the maritime community. The years 1990 through
    1997 show a tremendous improvement in channel stability. We have only
    been below project draft 3 percent of the time for vessels under
    100,000 deadweight tons and 8 percent of the time for vessels 100,000
    deadweight tons or greater. The funding you provided was money well
    spent. The repairs to the jetties and dikes and the Corps' ability to
    rapidly respond to shoaling have been instrumental in maintaining
    project dimensions. However, the lack of available hopper dredges is
    jeopardizing the stability of the channel.
        To enhance the safe and efficient movement of ships and cargo, we
    recommend mining sediment from the Pilottown Anchorage to create and
    enhance wetlands. Each 800,000 cubic yards of dredged material creates
    115 acres of wetlands and enhances 256 more. In the process, much-
    needed Pilottown Anchorage at fog-prone Head of Passes would be dredged
    to accommodate the increasing number of deeply-ladened ships attracted
    by the 45-foot channel. Dredging Pilottown Anchorage would also
    mitigate anchorage space lost in this area to the proposed
    environmentally beneficial West Bay Diversion Project, which we fully
    support.
        The Pilots have taken advantage of tidal flows and other factors to
    recommend the maximum draft possible consistent with safe navigation.
    This stability represents additional sales and increased
    competitiveness for U.S. products on the world market. Industry's
    partnership with you has kept Mississippi River ports competitive and
    attractive to vessels. Twelve inches to a large vessel with a loading
    capacity of 250 tons per inch is an additional 3,000 tons of cargo. As
    of this writing, freight rates for grain moving from the Mississippi
    River to the Far East and Europe are ranging from $15.30 per ton to
    $10.28 a ton. Using the average, $12.79, each foot of draft represents
    an additional $38,370 in vessel revenue, or $191,850 for the five
    additional feet over the old 40-foot project draft.
        The funds we request for maintenance dredging and other works are
    essential for the Corps to maintain a reliable channel and respond
    rapidly to potential problems. This builds the confidence of the bulk
    trade in a reliable Mississippi River draft, which is critically
    important. Much of Louisiana's bulk trade is export agricultural
    products and coal. These commodities are neither captive to Louisiana
    nor the United States if they can be shipped from competing countries
    at a consistently lower cost.
        The deeper the channel, the more important channel stabilization
    is. Adequate channel stabilization work minimizes the maintenance cost
    of the deeper channel--a cost-effective investment. The faster the
    project is stabilized, the faster and greater the benefits of reduced
    O&M costs will be realized. Also, we recommend that the Corps conduct
    research on prototype dredging techniques. Experimental dredging would
    not replace routine dredging but would permit, for example, testing
    dustpan dredges in SWP and the water injection dredges at the crossings
    above New Orleans.
        Funds are also needed for dustpan dredges to work the crossings
    above New Orleans. These crossings control the draft to eight of our
    ten major grain elevators, plus many mid-stream and other bulk cargo
    facilities. This area caters to the bulk trade and must have a stable
    channel depth consistent with the depth at SWP. Only two dredges in the
    world are available to maintain the deep-draft crossings between New
    Orleans and Baton Rouge. There are times when a high river is followed
    by a rapid drop in the river's stage. In such cases, the dustpan
    dredges may not be available, or both dredges may not be capable of
    restoring the 12 crossings within a reasonable time. When this happens,
    hopper dredges are used to assist in the work.
        The Corps is studying the makeup of their ``minimum fleet''--the
    number of dredges the Corps owns and operates. Corps-owned dredges
    working the lower Mississippi River are the hopper dredges WHEELER,
    MACFARLAND, and ESSAYONS, and the dustpan dredge JADWIN. The WHEELER
    and MACFARLAND, and from time to time the ESSAYONS, provide much-needed
    capacity and immediate response to keep SWP open, especially when the
    river is abnormally high. The action by Congress to reduce the
    government hopper fleet has drastically diminished the Corps' ability
    to maintain reliable project dimensions and adversely affect our
    country's standing in world bulk markets. We urge Congress to
    reconsider its decision to place the WHEELER on stand-by status. Even
    when the WHEELER is available, the combined Corps/private fleet does
    not have enough Mississippi River-qualified hopper dredges to meet peak
    dredging requirements. The Corps' Minimum Dredge Fleet studies, we
    feel, neither justify a reduction in the fleet nor the lay-up/stand-by
    status of the WHEELER or any other Corps-owned dredge. The Corps'
    records show there was a shortage of hopper dredges for the 1997
    highwater season, and this year is no different. Two hoppers were
    needed to begin work in SWP, but none were available. The Corps,
    through a test program, has employed two dustpan dredges to try to keep
    the channel open. This is not efficient because the silt is only moved
    to the edge or side of the channel and can fall back into the waterway.
    In fact, the situation became so difficult that ships were taking about
    eight hours to transit a two-mile reach at the jetty end of SWP.
    Normally it takes about two and one-half hours to transit the entire 20
    miles of the SWP. This serious situation resulted in the WHEELER being
    released from Mobile to work the troubled SWP area. Besides the
    Mississippi River ports, this shortage of dredges also impacts many of
    our nation's deep-draft ports and is particularly disruptive to the
    Port of Lake Charles, Louisiana, where dredging suffers practically
    every year.
        For all of the above reasons, we request full funding for the
    mitigation features of the O&M General, 45-foot Mississippi River
    project.
        In December 1994, the Corps completed the 45-foot deep channel to
    Baton Rouge. Proper maintenance now provides uniform drafts for all the
    ports on the lower Mississippi River. This makes U.S. exports through
    Louisiana more competitive, and adequate federal maintenance funds to
    keep the channel open must be available. In addition, the Corps needs
    authorization to construct and maintain anchorages to improve safety.
    Over the years, revetment work and changes in the river itself have
    caused serious negative impacts on our anchorages. Therefore, we
    encourage full funding capability in fiscal year 2000 to complete the
    reconnaissance study of navigation needs on the Mississippi River and
    its outlets between Baton Rouge and the Gulf.
        We also support Phase III of the Mississippi River channel
    deepening project and urge that the Corps be funded to proceed with
    design studies for the 55-foot channel, Baton Rouge to the Gulf of
    Mexico.
        The growth of the Port of New Orleans depends, in large measure, on
    the Port's container and other facilities on the Mississippi River-Gulf
    Outlet (MR-GO). The funds you provided in past fiscal years have
    allowed the Corps to improve the channel considerably. However, the
    channel width has remained limited primarily because of erosion. For
    safety reasons in this narrow channel, one-way traffic restrictions
    apply to vessels with a draft of 30 feet or more, causing delays to the
    tightly-scheduled container traffic using the MR-GO. These specialty
    vessels serving the Port's facilities are becoming larger. This
    channel, with less than stable full project dimensions, causes problems
    for larger vessels, reducing our ability to grow with the trade.
    Hurricane Georges compounded the MR-GO problems by causing severe
    shoaling in the channel restricting the project depth of 36 feet to as
    low as 25 feet. Restoration has been ongoing for over five months.
    Initially the lack of available hopper dredges curtailed work. The
    highest wages under the International Longshoreman's Association's
    contract ($24 per straight-time hour) is paid for work at the MR-GO
    container facilities. Anything that threatens the MR-GO jeopardizes
    these high-paying jobs, which are held mostly by minority workers.
        To improve safety on the MR-GO and protect Louisiana's container
    trade (and the well-paying, minority employment it produces), we
    request that the Corps be funded to an increased capability for the MR-
    GO in fiscal year 2000. This will allow annual maintenance dredging,
    north and south bank stabilization, and jetty maintenance, which is
    essential to provide the stability needed for vessel and port
    operations.
        With facilities located on both the MR-GO and the Mississippi
    River, an adequate route between the two is essential for efficient
    transit between these facilities. The shortest route is the inadequate,
    antiquated Inner Harbor Navigation Canal (IHNC) Lock built in the 1920s
    with a width of 75 feet and limited depth of 30 feet. Its maximum
    capacity has long been exceeded. The average waiting time for passage
    through the Lock has increased from 8\1/2\ hours in 1985 to about 12
    hours at present; however, we understand that waiting time can be more
    than a day in some instances. A much larger ship lock is necessary to
    accommodate today's traffic.
        The replacement project for the IHNC Lock is important to the ports
    on the lower Mississippi River and to the nation's commerce since it is
    on the corridor for east/west barge traffic. The President's fiscal
    year 2000 budget of $13,000,000 is not sufficient. Without full
    funding, the project will be delayed and increase the overall cost of
    the project. We urge Congress to provide the Corps' full fiscal year
    2000 capability for this important project to insure its completion.
    Delays are unthinkable since the new lock is long overdue.
        The Port of Lake Charles, Louisiana, is served by the Calcasieu
    River, which is often below project depth and width. This is another of
    Louisiana's major deep-water ports that benefits the economy of the
    state and the nation. According to the Port's rough figures, their
    import and export tonnage is up from 49.8 million tons in 1997 to over
    50.1 million tons for 1998. The public and private facilities along
    this waterway provide thousands of jobs for the Lake Charles area. In
    1998 there were 1,150 ships and 6,999 barges that used the waterway.
    While cargo tonnage and barge traffic is only up slightly, it should be
    noted that ship traffic up from 945 in 1997 to 1,150 in 1998, a 21.69
    percent increase. Part of this increase in ship traffic is due to ships
    calling with less cargo because of the channel deficiencies. This
    channel, because of its project deficiencies, requires one-way traffic
    for many ships, causing delays that disrupt cargo operations. This is
    costly and inefficient for industry. Last year, because of channel
    deficiencies, we know at least one major tanker service that calls at
    one of the area's major refineries reduced their operating draft by two
    feet in order to meet their company's safety and environmental policy
    requirement. This draft reduction reduces the delivery capacity to the
    facility, causing a less efficient plant operation and increasing the
    operating costs of the ships serving the plant. In just this one
    specific case, over the course of a year, the ship and refinery costs
    will increase by $4.7 million. The added costs have the potential of
    eventually causing a shift of the cargo currently destined for Lake
    Charles to other ports. This will reduce jobs in the area and disrupt
    the economy of the community. The Port area's growth and continued
    success depends on a reliable and safe channel that should be at full
    project. We request funding to the full capability of the Corps to
    maintain this channel at its project dimensions.
        The J. Bennett Johnston Waterway, Mississippi River to Shreveport,
    Louisiana, Project is directly related to our deep-water ports. The
    continuation and completion of this work will stimulate the economy all
    along the Red River Basin with jobs and additional international trade.
    This stimulated trade will service the Port of Shreveport and the ports
    on the lower Mississippi River, providing needed growth and benefitting
    the states of Louisiana, Texas, Oklahoma, and Arkansas, which are
    served through the Shreveport distribution center. Therefore, we
    strongly recommend that the Corps be funded to full capability for
    fiscal year 2000.
        The proposed Harbor Service Fee (HSF) in the President's budget,
    which would replace the Harbor Maintenance Tax, is ill-advised. What it
    fails to recognize is that there is no equitable way in which the cost
    can be spread fairly among the shipping community. Whether the HSF is
    to the cargo or to the ship, the fee will change trade patterns and
    even jeopardize our trading position in the world market. The proposal
    will disrupt jobs and the economies of port areas. It will circumvent
    the normal, healthy competition among U.S. ports. Ships carrying low-
    valued cargo, primarily bulk cargoes, operate on a very low profit
    margin; therefore, cargoes like grain and coal can least afford the
    tax. The end result could well be that the U.S. could lose its ability
    to compete in the world market for the export of these cargoes. This
    impact on bulk trade will be particularly detrimental to Louisiana
    because of the high volume of such cargoes that move through our state.
    We encourage Congress to fund the maintenance of our nation's ports
    through the general fund. After all, it is our nation (the people) that
    benefit from a strong U.S. position in world trade, not the shipping
    industry. If our nation is to remain competitive in the world market,
    we must maintain and improve our waterways and deliver U.S. goods at
    the lowest possible price to foreign markets.
        Thank you for allowing the Association to submit testimony on the
    Corps' funding needs.
                                     ______

      Prepared Statement of J. Ron Brinson, President and Chief Executive
                 Officer, Port of New Orleans, New Orleans, LA

        The Port of New Orleans is located at the terminus of the most
    extensively developed waterway system in the world, the 14,500 mile
    inland waterway system of the United States. The Port, via the
    Mississippi River and the Mississippi River Gulf Outlet, serves as the
    gateway between America's heartland and the global marketplace.
        We fully support the March 26, 1999 statement of the Louisiana
    Governor's Task Force on Maritime Industry on behalf of the ports and
    related maritime interests on the lower Mississippi River, J. Bennett
    Johnston Waterway and the Calcasieu River Waterway.
        We greatly appreciate the outstanding support and cooperation
    received over many years from you and your subcommittee.
                                     ______

    Prepared Statement of Gary P. LaGrange, Executive Director/CEO, Port of
                          South Louisiana, LaPlace, LA

        The South Louisiana Port Commission very much appreciates being
    given the opportunity to submit this statement and supportive material
    to signify its endorsement of the statement of Mr. Donald T. Bollinger,
    Chairman of the Louisiana Governor's Task Force on Maritime Industry.
        The Port of South Louisiana is comprised of nearly 54 miles of
    Mississippi River north of New Orleans and south of Baton Rouge, with
    more than fifty private and public docks and wharves. The Port of South
    Louisiana is the largest tonnage port in the United States and third
    largest in the world, handling more than 216 million short tons of
    cargo during 1998. Of this total tonnage, more than 100 million tons
    are shipped in international trade by deep water vessel and 116 million
    tons are shipped in domestic trade by vessels and barges. Each year
    more than 100,000 barges transport cargo at the Port of South Louisiana
    and more than 4,000 ships call at the public and private wharves of our
    Port.
        A recent study by Dr. Tim Ryan of the University of New Orleans
    indicates that nearly 20 per cent of the domestic gross product of the
    State of Louisiana is dependent upon the maritime industry and one of
    twelve jobs is created from the economic activity of the maritime
    industry. Attached you will find statistics which have been developed
    from the records of the South Louisiana Port Commission.
        The Port of South Louisiana strongly urges the Congress to fund all
    of the following projects.
        1. Mississippi River Ship Channel, Gulf to Baton Rouge, LA
    (Construction General)
        2. Mississippi River, Baton Rouge to the Gulf, Maintenance Dredging
    and GI Funds For Navigation Study
        3. Mississippi River-Gulf Outlet (MR-GO), LA., Maintenance Dredging
        4. Inner Harbor Navigation Canal (IHNC) Lock, LA
        5. Mississippi River Outlets at Venice, LA
        6. Intracoastal Waterway Locks, LA
        7. Gulf Intracoastal Waterway, LA and TX
        8. Calcasieu Lock, LA
        9. Calcasieu River & Pass, LA
        10. J. Bennett Johnston Waterway, Mississippi River to Shreveport
        The Port of South Louisiana strongly believes that the funding and
    completion of the above maritime projects will enhance the ability of
    the ports in the region to be competitive in the global economy and
    will enhance the ability of domestic industry and agriculture to
    compete in the export of its products.
        If we can provide any further information, please feel free to call
    upon me.
                                     ______

      Prepared Statement of Roger P. Richard, Executive Director, Port of
                      Greater Baton Rouge, Port Allen, LA

        The Port of Greater Baton Rouge respectfully requests that your
    committee give favorable consideration to the following projects.
        1. Mississippi River Ship Channel--Gulf to Baton Rouge,
    Louisiana.--We support full funding in fiscal year 1998-99 to the Corps
    of Engineers General Construction Budget. This will allow for the
    completion of the saltwater intrusion mitigation plan and the design
    studies for the fifty-five foot channel.
        2. Mississippi River--Baton Rouge to the Gulf--Maintenance Dredging
    and GI funds for navigation study.--We support maximum funding for
    maintenance dredging on this stretch of the river and for the
    navigation improvement study to reduce long term maintenance cost.
        3. Intracoastal Waterway Locks, LA.--Recommend approval of the
    President's fiscal year 2000 budget of $700,000 in GI funds to continue
    the feasibility study and to develop plans for replacement of Bayou
    Sorrel Lock on the GIWW, Morgan City to Port Allen alternate route.
        As stated in previous correspondence, these two projects are vital
    not only to the Port of Greater Baton Rouge but to the entire nation.
    The great Mississippi River is the premier national waterway, providing
    accessibility to and from foreign countries for the transportation of
    goods and services used by countless numbers of U.S. companies and
    individual citizens. The channel must be properly designed and
    maintained for the benefit of all ports.
        We also earnestly request your support for funding of the other
    projects included in testimony prepared and submitted by Mr. Donald T.
    Bollinger. A summary of Mr. Bollinger's statement is attached. These
    projects are also extremely important to the overall viability of the
    Mississippi River system and its tributaries. We must properly maintain
    our waterway infrastructure if we are to increase trade and have the
    confidence of our trading partners around the world. Your cooperation
    and support of these important projects for the Mississippi River are
    greatly appreciated.
                                     ______

      Prepared Statement of Glenwood W. Wiseman, Executive Director, Lake
              Charles Harbor & Terminal District, Lake Charles, LA

        The Lake Charles Harbor and Terminal District respectfully requests
    favorable consideration from you and your committee for the following
    projects.
        1. Calcasieu River and Pass, Louisiana.--The District supports full
    funding for the O&M general and supports additional funding for
    advanced maintenance dredging, disposal area renovations and bank
    stabilizing rock.
        This project is vital not only to the Port of Lake Charles, but to
    many parts of the nation. The Calcasieu River provides a route for oil
    and gas to enter the country's 15th largest port and ultimately be
    distributed to the Midwest and Northeast areas. The Port also provides
    a route for exports such as bagged grains, wood and paper products, dry
    bulk materials and other commodities which originate from as far as the
    Pacific Northwest.
        The District also requests support for funding of the other
    projects included in the testimony of Mr. Donald Bollinger. These
    projects are extremely important to Louisiana ports as well as the
    nation.
        Your assistance with these matters are most appreciated.
                                     ______

     Prepared Statement of Benny Rousselle, Plaquemines Parish Government,
                                Belle Chasse, LA

        In my official capacity as Parish President of Plaquemines Parish
    Louisiana, I am herein requesting the following appropriations be made
    for fiscal year 2000:
        1. MISSISSIPPI RIVER SHIP CHANNEL, GULF TO BATON ROUGE, LOUISIANA
    (CONSTRUCTION GENERAL).--We recommend that the Corps be funded to full
    capability in fiscal year 2000 to perform required work on the
    saltwater intrusion mitigation plan.
        2. MISSISSIPPI RIVER, BATON ROUGE TO THE GULF, MAINTENANCE
    DREDGING.--We recommend that approval of the President's fiscal year
    2000 Budget of $64,430,000 under O&M General.
        3. MISSISSIPPI RIVER OUTLETS AT VENICE, LOUISIANA.--The President's
    fiscal year 2000 Budget is $2,743,000 under O&M General. Recommend that
    Corps be funded increased capability for repair of jetty-breakwater at
    Baptiste Collette.
        We would certainly appreciate your consideration and all the
    assistance you can give us in those projects.
                                     ______

    Prepared Statement of John L. Levine, Jr., President, Associated Branch
                              Pilots, Metairie, LA

        The Associated Branch Pilots is an Association of Pilots that have
    been guiding oceangoing vessels into the entrances of the Mississippi
    River system for over 125 years. We are called Bar Pilots because we
    guide the ships past the constantly shifting and shoaling sand bars in
    the area.
        Southwest Pass of the Mississippi River is the main entrance for
    deep draft oceangoing vessels entering the Lower Mississippi River
    System. It is the shallowest stretch of the Lower Mississippi River
    System and the area that requires the greatest effort by the Corps of
    Engineers to maintain project depth.
        In 1998, the Associated Branch Pilots made 12,697 transits on
    oceangoing vessels through Southwest Pass. Of these ships, 3,252 were
    of 50,000 deadweight tons or greater and 475 had a draft in excess of
    40 feet.
        This number of heavily laden vessels calling on the Lower
    Mississippi River System is a direct result of the completion by the
    Corps of Engineers of the deepening of the channel from 40 feet to 45
    feet.
        This first phase has proven to be extremely well designed and well
    maintained by the fact that the maximum draft recommended by my
    Association for vessels using Southwest Pass has been 45 feet or
    greater, except for periods of extremely high water that caused
    shoaling that overwhelmed the dredging efforts. This is in stark
    contrast to the late 1970's and early 1980's when we often had to
    recommend drafts less than the project depth due to shoaling.
        To the world shipping community, this means that calling at ports
    on the Mississippi River system will be more profitable because larger
    ships can enter and carry greater amounts of cargo.
        This is beneficial to the entire United States because it makes the
    large quantities of petroleum, agricultural, and manufactured products
    shipped from the Mississippi Valley more desirable due to increased
    profitability.
        I would also like to comment briefly on the East-West navigation
    channels near Venice, Louisiana. Tiger Pass and Baptiste Collette
    provide a shorter, more direct route to Breton Sound and the Gulf of
    Mexico for offshore supply boats and small tugs and barges. These
    channels not only represent a savings in time and money for these
    vessels, but reduce the traffic in the main shipping channel, the
    Mississippi River and its passes, which is one of the most congested
    waterways in the country.
        The dredging and maintaining of South Pass would contribute to the
    safety of the overall waterway and, in my opinion, be of greater value
    than the much
        The Associated Branch Pilots also pilot vessels in the Mississippi
    River Gulf Outlet, a man-made tidewater channel 75 miles long,
    stretching from the Gulf of Mexico to an intersection of the
    Intercoastal Waterway in New Orleans.
        This channel leads to the Main Container Terminals for the Port of
    New Orleans, the Roll On, Roll Off Terminal, the Port of New Orleans
    Bulk Handling Plant, and additional General Cargo Docks. For the Port
    of New Orleans to remain competitive in the ever growing container
    trade, the continued maintenance of this channel is crucial. In 1998,
    542 ships called on the port using the Mississippi River Gulf Outlet.
        Much is being said pro and con concerning the Mississippi River
    Gulf Outlet. There is, admittedly, an erosion problem in the
    Mississippi River Gulf Outlet, but any curtailment of shipping traffic
    in the channel without regard to the long term effect upon the Port of
    New Orleans would be disastrous. I strongly support approval of funding
    for both the maintenance dredging/jetty repair project and the erosion/
    rip rap study for the Mississippi River Gulf Outlet.
        I would also like to make a brief statement on behalf of the
    Mississippi Valley Coal Export Council. Over 62 million tons of coal
    have been exported using the Mississippi River System during the past
    five years. Coal miners, tugboat captains, barge owners, shippers and
    many other coal related workers have benefited by using the consistent
    and efficient Mississippi River System. This also represents a
    significant contribution towards the trade balance between the United
    States and other industrialized nations.
        Funding of the Corps of Engineers' projects in the Lower
    Mississippi River System has proven to be money well spent. It has
    increased exports and imports that have benefited the entire United
    States. I urge your support of the funding requested to enable the
    Corps to continue to maintain and improve the most efficient and
    productive waterway system in the country.
                                     ______

    Prepared Statement of Capt. Mark Delesdernier, Jr., President, Crescent
                River Port Pilots' Association, Belle Chasse, LA

        Mr. Chairman: I have served as President of the largest pilot
    association in the United States for the past seventeen (17) years. The
    Crescent River Port Pilots furnish pilots for ships destined to the
    Port of Baton Rouge, Port of South Louisiana, Port of New Orleans, Port
    of St. Bernard, and the Port of Plaquemines.
        The Crescent River Port Pilots piloted and shifted over seventeen
    thousand (17,000) ships during 1998. We pilot deep draft vessels on
    more than one hundred (100) miles on the lower Mississippi River and
    thirty five (35) miles on the Mississippi River Gulf Outlet.
        The lower end of our route on the Mississippi River has a shoaling
    problem starting with the high water season each year. The shoaling
    requires daily attention by the United States Army Corps of Engineers
    to maintain project depth.
        Heavy laden vessels call on the lower Mississippi River system as a
    direct result of the completion by the Corps of Engineers of the
    deepening of the channel from forty feet (40) to forty five (45) feet.
        For several years now, we have had extraordinary success in keeping
    the river dredges to project depth. This success is a direct result of
    an experienced and vigilant Corps of Engineers that, through
    experience, is able to timely bid in dredges to avoid extra dredging
    cost by waiting to long to start maintenance dredging.
        Channel stability sends a positive message to the world's shipping
    community that schedule cargo for deep draft vessels months in advance
    is reliable. This makes the port call on the Mississippi River very
    profitable since the ships can lift greater tonnage.
        Keeping project depth is beneficial to twenty seven states that are
    directly tied to the Mississippi River Port Complex.
        Additionally I would like to comment on the east and west
    navigation channels near Venice, Louisiana. Baptiste Collette and Tiger
    Pass provide a shorter and more direct route to Breton Sound and West
    Delta in the Gulf of Mexico for oil field support vessels.
        The Crescent River Port Pilots also pilot ships in the Mississippi
    River Gulf Outlet. A man-made channel approximately 75 miles long
    starting in Breton Sound in the Gulf of Mexico and ending in New
    Orleans where it intersects with the Intercoastal Waterway.
        The Mississippi River Gulf Outlet feeds the main container
    terminals in the Port of New Orleans. Additional docks such as Bulk
    Terminal and general cargo facilities depend on this channel which
    handled approximately 700 ship calls last year.
        The Mississippi River Gulf Outlet has been a controversial channel
    since its inception, but being an integral part of the Port of New
    Orleans, it would be a disaster if it is not kept at project width and
    depth. The Crescent River Pilots strongly support approval of funding
    for both the maintenance dredging, jetty repair projects.
        Funding of the United States Army Corps of Engineers projects in
    the lower Mississippi River system which includes the Mississippi River
    Gulf Outlet, Tiger Pass, Baptiste Collette and Southwest Pass has
    proven to be money well spent.
        I urge your support of the funding requested to allow the Corps of
    Engineers to continue to maintain and improve the most productive
    waterway system in the world.
        Mr. Chairman, thanks for allowing me the opportunity to submit my
    comments to your subcommittee.
                                     ______

    Prepared Statement of Gov. M.J. ``Mike'' Foster, Jr., on Behalf of the
       Louisiana Department of Transportation and Development, Office of
                   Public Works and Intermodal Transportation

                   mississippi river and tributaries project
        The Louisiana Department of Transportation and Development, Office
    of Public Works and Intermodal Transportation, is the agency designated
    to represent the State of Louisiana in the planning and orderly
    development of its water resources. This statement is presented on
    behalf of the State of Louisiana and contains recommendations for
    fiscal year 2000 appropriations for work in Louisiana under the
    Mississippi River and Tributaries Project.
        Louisiana contains the terminus of the Mississippi River, which has
    the third largest drainage basin in the world, exceeded only by the
    watersheds of the Amazon and Congo Rivers. The Mississippi River drains
    41 percent, or 1\1/4\ million square miles, of the contiguous United
    States and parts of two Canadian provinces. All of the runoff from
    major river basins, such as the Missouri and Upper Mississippi, the
    Ohio including the Tennessee and others, and the Arkansas and White,
    flow into the Lower Mississippi, which empties into the Gulf of Mexico
    through Louisiana.
        The jurisdiction of levee boards in Louisiana includes one-third of
    the State's total area. However, the importance of this one-third of
    the State can be seen by the fact that it contains nearly 75 percent of
    the State's population and about 90 percent of the State's disposable
    personal income. Traditionally, the levee district areas are water rich
    and have fallen heir to industrial development that ranks high in the
    nation. It has been estimated that about 60 percent of the State's
    agricultural products come from levee district areas. So you can see
    why Louisiana and its twenty levee districts are so interested in
    seeing the completion of the Mississippi River and Tributaries Project.
        In making the following recommendations regarding construction,
    studies, and some selected operation and maintenance items, the State
    of Louisiana would hope that Congress and the Administration will honor
    their prior commitments to infrastructure development and fund our
    requests.
        The following Louisiana projects are those for which we are
    requesting an increase to the President's budget request. For those
    Louisiana projects not listed we agree with the President's budget
    request. See the attached ``Summary of Recommended Appropriations'' for
    a complete listing.
            Operation and Maintenance                                Request
    Atchafalaya Basin.......................................     $19,125,000
    Old River...............................................       8,110,000
    Bonnet Carre............................................       1,068,000
    Bayou Rapides Drainage Structure and Pumping Plant
        (Lower Red River, South Bank Levees)................       2,950,000
    Atchafalaya Basin Floodway System.......................       1,702,000

        The operation and maintenance of completed works are essential to
    achieving the full benefits of the projects. In times of budget
    constraints it is essential that operation and maintenance not be
    delayed which would hamper the effectiveness of the projects and cause
    more expensive maintenance at a later date. Specifically, there are six
    levee slides at five locations along the West Atchafalaya Basin
    Protection Levee which require immediate attention. We are requesting
    an additional $4.2 million to be designated for this purpose in the
    Atchafalaya Basin O&M account.
        The Bayou Rapides Drainage Structure and Pumping Plant Project is
    authorized under the Lower Red River, South Bank Levees of the
    Mississippi River and Tributaries Project. This project is considered
    major maintenance and additional funds of $2.95 million are urgently
    needed to construct this project. We urge your support for funding and
    request that specific language be included in the appropriations bill
    to earmark the funds and direct the Secretary of the Army to construct
    this project.
        All the above listed projects have reached a point where delayed
    maintenance is now essential and we urge you to fund these projects in
    the amounts requested.
    MISSISSIPPI RIVER LEVEES (LA ONLY)--Request: $17,320,000
        The Mississippi River and Tributaries Project above Louisiana is
    about 90 percent complete, but to a much lesser extent in Louisiana.
    Because of the improvements upstream, increased flows are a major
    problem in Louisiana where the project is lagging behind the
    construction in the upper valley. We request funds for levee
    enlargement work within the Fifth Louisiana Levee District where there
    is a deficiency of 4 to 7 feet on mainline Mississippi River levees. It
    is also requested that Federal funds be provided to purchase rights-of-
    way for this critical work as the Levee District is in an economically
    depressed area and does not have a tax base capable of producing the
    funds necessary for both maintenance and rights-of-way.
    LOUISIANA STATE PENITENTIARY LEVEE--Request: $9,000,000
        The Louisiana State Penitentiary Levee is the only section of
    Mississippi River levee in Louisiana that is not currently constructed
    to Federal standards. It was authorized under the Mississippi River and
    Tributaries Project in 1986 and re-authorized in 1990. We urge your
    support in funding this project and request that specific language be
    included in the appropriations bill to direct the Secretary of the Army
    to construct this project before an emergency situation arises during a
    major river flood. We also request authorization for credit for work
    accomplished by non-Federal interests.
    ATCHAFALAYA BASIN--Request: $27,750,000
        This project is a main stem component of the flood control plan for
    the Mississippi River and Tributaries Project. The Mississippi River
    can safely carry only one-half of the project flood, or 1,500,000 cubic
    feet per second, below Old River; the other 1,500,000 cubic feet per
    second must be discharged through the Atchafalaya Basin. The levees
    which must confine this flow to the basin are now deficient because
    they have settled below original design grade due to consolidation of
    the underlying soils, and the design has been revised upward. This
    places the lives and welfare of approximately 650,000 people and their
    property and improvements in 13 parishes in the immediate vicinity of
    the Atchafalaya Floodway in jeopardy each flood year. The tax
    assessment records indicate the value of potential flood losses to be
    approximately $8 billion, not including public improvements. Over the
    past half century, we have supported the Mississippi River and
    Tributaries Project and have agreed that construction of flood
    protection works should start upstream and progress downstream. As a
    result, the Mississippi River and Tributaries Project is now more than
    90 percent complete in sites upstream from Louisiana, while the levees
    in the Atchafalaya Basin can contain approximately only 90 percent of
    the project flood. Work on this project has been underway since 1928
    and isn't scheduled for completion until the year 2031--a date that
    continually keeps moving further into the future. With the reduced
    budgets being enacted, Louisiana may never realize the full benefits of
    this project before the dreaded project flood occurs. We urge your
    support for funding this effort to the full capability of the Corps.
    CHANNEL IMPROVEMENT (LA ONLY)--Request: $23,604,000
        Channel improvements and stabilization provide protection of the
    levees and the development behind them, as well as preventing
    unsatisfactory alignment where the river's bank is unstable. We are
    requesting an additional $2,500,000 for the Vicksburg District for
    fiscal year 2000 to keep the program moving forward. The funds we are
    requesting will provide for the dredging and revetment work necessary
    to accommodate increased flows caused by upstream improvements.
    TENSAS BASIN, RED RIVER BACKWATER AREA (Sicily Island Area Levee
            Project)--Request: $9,930,000
        The funds for fiscal year 2000 are to be used to continue
    construction of levee Items 2A and 2B, complete the HaHa Pumping Plant,
    Item 1E, levee Item 3B and Fool River pumping plant. An additional $1
    million is requested to advance the award of Item 1C and 1D and
    acquisition of lands.
    ATCHAFALAYA BASIN FLOODWAY SYSTEM--Request: $8,000,000
        The project consists of acquiring real estate interests, excluding
    minerals, in the lower floodway for flood control, environmental
    protection, and public access purposes. The timing of the acquisition
    of land necessitates the increased funding request.
    MISSISSIPPI DELTA REGION PROJECT, DAVIS POND--Request: $11,884,000
        Davis Pond Freshwater Diversion Project is necessary to aid in the
    fight against coastal erosion and land loss. The State of Louisiana's
    commitment to this project is demonstrated by our agreement to provide
    25 percent of the cost of construction, as well as operation and
    maintenance, of the Davis Pond structure despite Congressional project
    authorization at 100 percent Federal cost.
               local contributions for flood control improvements
        Historically, Louisiana has always done its part in cooperation
    with the Federal agencies concerned with flood control. The Louisiana
    State Board of Engineers, the forerunner of the Department of
    Transportation and Development, Office of Public Works and Intermodal
    Transportation, was created in 1879, the same year as the Mississippi
    River Commission, to coordinate the planning and construction of the
    required flood control facilities to protect the State. Since that
    time, local expenditures for flood control have exceeded $730,000,000.
    This amount adjusted to 1979 dollars represents expenditures in excess
    of $5.3 billion. Nearly one-half of the potential flooded area of the
    Lower Mississippi River Valley lies in Louisiana. Local expenditures
    for flood control have increased with the growth of the valley. This
    record not only meets, but exceeds any National Water Policy local
    participation requirement ever put into practice.
                                   conclusion
        The Mississippi River and Tributaries Project has been underway
    since 1928 and isn't scheduled for completion until the year 2031--a
    date that continually keeps moving further into the future. We
    understand the need for budget constraints, but the President's budget
    request of $280,000,000 for the total MR&T Project is not adequate. We
    endorse the recommendation of the Mississippi Valley Flood Control
    Association in their request for a minimum of $335,000,000 MR&T budget
    for funding to the full capability of the Corps throughout the whole
    valley.
        The State of Louisiana, Department of Transportation and
    Development, Office of Public Works and Intermodal Transportation, in
    particular, wishes to commend the Appropriations Subcommittees on
    Energy and Water Development, and express our appreciation for the
    foresight and understanding exhibited for water resources projects
    which are vital to the national interest. We solicit your further
    consideration of the recommendations presented herein.

     MISSISSIPPI RIVER AND TRIBUTARIES SUMMARY OF RECOMMENDED APPROPRIATIONS
                              FOR FISCAL YEAR 2000
    ------------------------------------------------------------------------
                                                                 Louisiana
               Louisiana projects             Budget request      request
    ------------------------------------------------------------------------
    Operation and Maintenance:
        Mississippi River Levees (LA only)..      $2,092,000      $2,092,000
        Atchafalaya Basin...................      10,560,000      19,125,000
        Channel Improvement (LA only).......      31,291,000      31,291,000
        Old River Control Structure.........       4,027,000       8,110,000
        Bonnet Carre Spillway...............       1,068,000       1,068,000
        Lower Red River, SOL--Bayou Rapides   ..............       2,950,000
         Drainage Structure & Pumping Plant.
        Tensas Basin:
            Boeuf & Tensas Rivers, (LA only)       1,406,000       1,406,000
            Red River Backwater Area........       2,927,000       2,927,000
        Atchafalaya Basin, Floodway System,          644,000       1,702,000
         LA.................................
        Baton Rouge Harbor--Devil Swamp, LA.         157,000         157,000
        Bayou Cocodrie and Tributaries......         101,000         101,000
        Mississippi Delta Region,                    436,000         436,000
         Caernarvon, LA.....................
        Lower Red River--South Bank Levees..          84,000          84,000
    Construction:
        Mississippi River Levees (LA only)..      13,020,000      17,320,000
        Louisiana State Penitentiary Levee..       3,000,000       9,000,000
        Atchafalaya Basin...................      19,750,000      23,750,000
        Channel Improvements (LA only)......      21,104,000      23,604,000
        Tensas Basin, Red River Backwater          8,903,000       9,930,000
         Area...............................
         Atchafalaya Basin, Floodway System.       7,500,000       8,000,000
        Mississippi Delta Region, Davis Pond      10,400,000      11,884,000
        Mississippi & Louisiana Estuarine            100,000         100,000
         Area (Bonnet Carre)................
    General Investigations:
        Morganza to the Gulf of Mexico......         700,000         700,000
        Alexandria to the Gulf of Mexico....         700,000         700,000
        Donaldsonville to the Gulf of Mexico         250,000         250,000
    ------------------------------------------------------------------------
    NOTE: The projects listed above are only those in Louisiana and directly
      affecting the State. We realize that there are other projects in these
      areas. We endorse the recommendations of the Mississippi Valley Flood
      Control Association.

                                     ______

        Prepared Statement of M.V. Williams, President, West Tennessee
        Tributaries Association, Friendship, TN and Chairman, Executive
            Committee, Mississippi Valley Flood Control Association

        Mr. Chairman and distinguished members of the Committee, my name is
    M.V. Williams and my home is in Friendship, Tennessee between the
    Middle and South Forks of the Forked Deer River. I am the President of
    the West Tennessee Tributaries Association. It is also my pleasure to
    serve as Chairman of the Executive Committee of the Mississippi Valley
    Flood Control Association with headquarters in Memphis, Tennessee. This
    statement on behalf of the Association presents their views on fiscal
    year 2000 Budget for the Mississippi River and Tributaries Project. I
    will present several items of general interest to all our Membership.
    Other Members of the Association will present statements that will
    concern specific items of interest.
        Since there are new members of the Sub-Committee I will briefly
    discuss the Mississippi Valley Flood Control Association which is an
    Agency composed almost entirely of public bodies having local
    responsibility for flood control, drainage, bank stabilization and
    navigation improvements in parts of Iowa, Illinois, Kentucky,
    Mississippi, Tennessee, Arkansas, Missouri and Louisiana. Our members
    are public officials who for the most part are elected by the people.
    The Association represents practically all of the levee and drainage
    districts, municipalities, port and harbor commissions and other state
    agencies in the Mississippi Valley, extending from Burlington, Iowa to
    the Gulf of Mexico. These organizations and agencies are political
    subdivisions of the various states in which they are organized and
    function. We provide an agency through which the people of the
    Mississippi Valley may speak and act jointly on all flood control,
    navigation, bank stabilization and major drainage problems. We have
    appeared before the Sub-Committee and served the people in the
    Mississippi Valley for well over sixty years.
        Our Association is comprised of a very large group of individuals
    who are businessmen, property owners, conservationists, farmers,
    attorneys, doctors, wildlife enthusiasts, engineers, accountants,
    environmentalists, civil servants and elected officials from all
    political parties.
        Our Objectives simply stated are:
        To seek Congressional authorization for, and adequate annual
    appropriations for the early completion of all flood control projects
    necessary for the protection of the Lower Mississippi Valley against
    the maximum probable flood.
        To secure prompt initiation of, and early completion of existing
    project for the stabilization of the banks of the Lower Mississippi
    River, in order to assure the integrity of the Main River Levee System;
    to provide increased flood discharge capacity, permanency of location
    for harbor facilities and industrial sites, and to obtain deeper and
    more reliable navigation channels.
        To support channel and major drainage improvements throughout the
    Lower Mississippi Valley to provide protection against headwater
    flooding, and to provide adequate outlets for local and state drainage
    projects.
        To cooperate in every proper way with the Department of the Army,
    the Chief of Engineers of the United States Army, the Mississippi River
    Commission and other agencies to hasten the accomplishment of flood
    control in the Mississippi Valley.
        We submit this testimony this year in support of the Mississippi
    River and Tributaries Project which was established by the Flood
    Control Act of 1928.
        Our Executive Committee is composed of business and professional
    men. They are men of wide experience in business, professional and
    civic life. They are mature in their judgment and responsible in their
    actions. It, therefore, has been no easy task for that Committee to
    arrive at an asking figure based on urgent needs and yet tempered in
    the light of the grave fiscal problems which face the Federal
    Government. I say these things to emphasize that our asking was not
    arrived at by whim and fancy.
        We have closely examined the President's Budget Request for fiscal
    year 2000 and find that it is completely inadequate for the Mississippi
    River and Tributaries Project. The $280,000,000 that the President has
    requested is the same amount that was requested last year, fortunately
    for the Nation the Congress in it's wisdom increased that amount. We
    request that this Committee strongly consider a minimum appropriation
    for fiscal year 2000 for the Mississippi River and Tributaries Project
    of $335,000,000.
        In requesting that such moneys be appropriated for flood control
    and navigation works of the Lower Mississippi Valley, we are not
    unmindful of the fact that in these critical times our Nation is being
    called upon to rectify an economic condition that needs immediate
    attention. We feel that we are justified in urging appropriations for
    our project for the reason that the assets and resources of this great
    nation must not be neglected during these times. We know of no other
    appropriation which contributes as much to national wealth and
    resources as flood control and navigation for the major rivers of this
    country. Millions of acres which were overflow lands decades ago are
    now highly productive and contributing to our national wealth. These
    lands by reason of their geographic location are the most fertile of
    the nation. They produce an abundance of food and fiber for the general
    welfare and prosperity of the country. The inland waterways of the
    nation provide the cheapest and in some cases the only method to move
    bulk commodities that are also absolutely essential to the general
    welfare and prosperity of the country. Moneys appropriated by Congress
    for flood control and navigation has and will augment our national
    resources and improve our economic well-being. The appropriations made
    by Congress for the Mississippi River and Tributaries project are
    investments in this nation's future.
        In closing let me reemphasize that federal works projects with
    proven merit such as the Mississippi River and Tributaries Project
    represent a sound federal investment which will return to the tax
    payers of this country generous dividends. Such federal investments
    contribute to the economic well being of the Nation by reducing
    unemployment; adding to the stability and economic growth of
    agriculture and industry; and providing a flood free environment for
    the welfare of the people of the Mississippi Valley.
        We reaffirm the position we have always held that the physical
    geography of the Mississippi River is such that flood control interests
    do not stop at the main river but extend upstream along the adjacent
    tributary streams and valleys. The Flood Control plan on the
    Mississippi River therefore cannot be considered adequate or complete
    until the flood control plans for these valleys, authorized as a part
    of the Mississippi River and Tributaries project, are completed.
        Under our Constitutional form of Government the Citizens as the
    final authority and for whose protection and welfare our Government
    exists, are entitled to the best protection from Floods our Nation is
    capable of devising. We would respectfully request that this committee
    consider that during it's deliberations of the Corps of Engineer's
    fiscal year 2000 Appropriations.
        We have attached a sheet to this statement that reflects the
    President's Budget Request and the Mississippi Valley Flood Control
    Association's request for Appropriations for the Mississippi River and
    Tributaries Project for fiscal year 2000.

       MISSISSIPPI VALLEY FLOOD CONTROL ASSOCIATION FISCAL YEAR 2000 CIVIL
          WORKS BUDGET-MISSISSIPPI RIVER AND TRIBUTARIES APPROPRIATIONS
    ------------------------------------------------------------------------
                Project and State             Budget request   MVFCA request
    ------------------------------------------------------------------------
    Surveys, continuation of planning and
     engineering & advance engineering &
     design:
        Mississippi River, Alexander Co., IL         $30,000         $30,000
         & Scott Co., MO....................
        Memphis Metro Area, TN & MS.........         675,000         675,000
        Reelfoot Lake, TN...................         318,000         318,000
        Wolf River, Memphis, TN.............         525,000         525,000
        Bayou Meto Basin, AR................       1,767,000       1,767,000
        Morganza, LA to the Gulf of Mexico..         700,000         700,000
        Alexandria, LA to the Gulf of Mexico         700,000         700,000
        Donaldsonville LA to the Gulf of             250,000         250,000
         Mexico.............................
        Collection & Study of Basic Data....         365,000         365,000
                                             -------------------------------
          Subtotal--Surveys, continuation of       5,330,000       5,330,000
           planning & engineering & advance
           engineering & design.............
    Construction:
        St. John's Bayou-New Madrid                7,800,000       9,800,000
         Floodway, MO.......................
        Eight Mile Creek, AR................         700,000         700,000
        Helena & Vicinity, AR...............       2,190,000       2,190,000
        Grand Prairie Region, AR............      21,900,000      21,900,000
        West Tennessee Tributaries, TN......       2,398,000       2,398,000
        Nonconnah Creek, TN.................       2,500,000       2,500,000
        St. Francis Basin, MO & AR..........       4,350,000       4,350,000
        Yazoo Basin, MS.....................      24,279,000      40,985,000
        Atchafalaya Basin, LA...............      19,750,000      21,750,000
        Atchafalaya Basin Floodway System...       7,500,000       8,000,000
        MS Delta Region, LA.................      10,400,000      10,400,000
        MS & LA Estaurine, Area, MS & LA....         100,000         100,000
        Louisiana State, Penitentiary, LA...       3,000,000       7,400,000
        Tensas Basin, Red River Backwater,         8,930,000       8,930,000
         LA.................................
        Channel Improvements, IL, KY, MO,         37,865,000      43,165,000
         AR, TN, MS & LA....................
        Mississippi River Levees, IL, KY,         23,250,000      32,750,000
         MO, AR, TN, MS & LA................
                                             -------------------------------
          Subtotal--Construction............     176,732,000     217,318,000
          Subtotal--Maintenance.............     117,500,000     131,914,000
                                             -------------------------------
          Subtotal--Mississippi River &          299,652,000     354,562,000
           tributaries......................
          Less reduction for savings &           -19,562,000     -19,562,000
           slippage.........................
                                             -------------------------------
          Grand total--Mississippi River and     280,000,000     335,000,000
           tributaries......................
    ------------------------------------------------------------------------

                                     ______

           Prepared Statement of Aubrey Gravois, President, Board of
          Commissioners, Lafourche Basin Levee District, Vacherie, LA

                            mississippi river levees
        Although there are no current or scheduled contracts within the
    jurisdiction of the Lafourche Basin Levee District for levee
    enlargements and slope paving, we still have a few areas which are
    below grade which needs to be elevated and slope paved. Therefore, we
    are requesting that these small reaches be considered in future
    appropriations.
        The Board of Commissioners of the Lafourche Basin Levee District
    urges the subcommittees to appropriate as much funds as possible for
    the continuation of the levee enlargement and concrete sloped pavements
    through out the State of Louisiana.
                              channel improvements
        The revetment construction program must be funded annually to
    prevent future levee failures, land losses and relocations. The
    Lafourche Basin Levee District has several areas of continued caving
    banks which concern us. Some of these banks are along reaches where
    there are extremely very narrow battures and further these areas are in
    locations where high tourism exist such as Oak Alley and Laura
    Plantations. The Lafourche Basin Levee District urges the committee to
    continue to appropriate as much funding as possible for the
    continuation of strong Channel Improvement Program. If caving banks are
    not controlled, the only answer is ``set back''. There is very little
    room remaining available for levee setbacks in the jurisdiction of the
    Lafourche Basin Levee District.
           donaldsonville to the gulf of mexico reconnaissance study
        The Board of Commissioners of the Lafourche Basin Levee District is
    grateful for the funding already submitted and received towards this
    very important study. For years now we have been deeply concerned with
    the drainage and back water flooding problems that have been and is
    continuing to occur in this basin which covers the jurisdictional
    boundaries of our levee district. The benefits from this study will
    hopefully become a massive project which will be of great benefit and
    assistance to the Lafourche Basin Levee District with regards to flood
    control efforts which will include wetlands hydrology, conservation,
    restoration, and wildlife habitat. The Board of Commissioners of the
    Lafourche Basin Levee District has taking on the responsibility of
    being the Local Sponsor of this subject study and we are urging the
    committee to commit to additional funding to the amount of $500,000 for
    fiscal year 2000. Budget contains $250,000.
                               the levee district
        The Lafourche Basin Levee District extends downstream from the City
    of Donaldsonville to the Jefferson-St. Charles Parish Line area, a
    distance of 63 miles, it includes the west (right descending) bank of
    the Mississippi River, and is comprised of portions of the following
    parishes: Ascension, St. James, St. John the Baptist, St. Charles,
    Lafourche, and Assumption. The Mississippi River westbank levee is
    continuous through out the Parishes of Ascension, St. James, St. John
    the Baptist, and St. Charles Parishes.
        Major industries have developed in the Lafourche Basin Levee
    District. One of the largest is the Nuclear Power Plant or Energy in
    Taft, Louisiana. Others such as ADM/Growmark, Agrico Chemical, CF
    Industries, Monsanto, Occidental Chemical Corp., Shell Chemical Co.,
    Triad Chemical, Union Carbide and others all reap the benefits of being
    protected from the flooding of the Mississippi River through the assets
    and contributions received for the MR&T Projects. Along with industrial
    growth, our Levee District is continuing to experience an increase in
    residential and urban expansions. A great portion of the rich land and
    soil in our levee district is used for agricultural purposes.
        Without the protection of the Mississippi River and Tributaries
    Flood Control Project, the continued flood control and maintenance
    improvements of the Lower River Valley Levees would not exist. The
    project is a necessity for us to be able to continue to serve the
    national needs of our economy and continued growth of our areas.
                                    comments
        The Lafourche Basin Levee District plans to continue to advise this
    subcommittee of our current and future needs. We understand that all of
    the items of the MR&T Flood Control Project are of extreme importance.
    We also understand that this year we may not be able to submit oral
    testimony before the subcommittees as we have done so in the past. We
    hope that we can return to this type process, so that we can verbally
    voice our concerns in person for the problems which occur in the Lower
    River Valley. Four representatives from the Lafourche Basin Levee
    District are here today desiring to present views to the subcommittee
    and they are President Aubrey Gravois, Commissioner Lloyd Becnel,
    Attorney Joseph C. Wiley, and Administrative Manager, Randy Trosclair.
                                   conclusion
        The Board of Commissioners of the Lafourche Basin Levee District
    realizes that the funding being discussed for water resources must be
    increased for the well being of our country. The improvements received
    from the funds for the MR&T Flood Control Projects are the wealth of
    the country, and they pay back their cost several times over and over.
    We must continue to protect our future. We along with many other levee
    districts endorse the recommendations presented by the Association of
    Levee Boards of Louisiana, Louisiana Department of Transportation and
    Development, Mississippi Valley Flood Control Association and the Red
    River Valley Association.
                                     ______

    Prepared Statement of Billy J. Felty, Chief Engineer, St. Francis Levee
                              District of Arkansas

        My name is Bill Felty. I am Chief Engineer of the St. Francis Levee
    District of Arkansas. I live in West Memphis, Arkansas which is located
    on the West side of the Mississippi River in the St. Francis Basin.
        The St. Francis Basin extends from the foot of Commerce Hills near
    Cape Girardeau, Missouri to the mouth of the St. Francis River seven
    miles above Helena, Arkansas, a distance of 235 miles. It extends to
    the West to the uplands of Bloomfield and Crowley's Ridge, having a
    maximum width of 45 miles. The Basin is comprised of an area of 3,500
    square miles.
        Within the St. Francis Basin and the Lower Mississippi Valley, we
    are witnessing a great industrial expansion and the economy in the area
    is improving rapidly throughout the entire basin especially along the
    Mississippi River. This industrial growth and prosperity could not
    exist without the drainage and flood control protection made possible
    by the appropriations from your Committee for the Mississippi River and
    Tributaries Project (MR&T). Since 1928, the MR&T Project has prevented
    flood damages in the Lower Mississippi Valley totaling $231 billion at
    an investment of $9.9 billion. Additionally the MR&T Project has
    resulted in an annual transportation savings on the Mississippi River
    totaling $1 billion.
        As your Subcommittee reviews the Civil Works Budget for fiscal year
    2000 appropriations for the MR&T Project, please consider the
    importance of this project to the Lower Mississippi Valley and to the
    Nations economy and infrastructure. The amount of $280,000,000 in the
    President's Budget for use in the MR&T Project throughout the Lower
    Mississippi Valley is far below the amount needed to keep vital
    projects on schedule. Considering the impacts that the Lower
    Mississippi Valley has on the nations economy and infrastructure, it is
    essential that we keep this project on track and complete it in a
    timely manner.
        Therefore, we support the amount of $335,000,000 as requested by
    the Mississippi Valley Flood Control Association for the fiscal year
    2000 Civil Works Budget, Mississippi River And Tributaries
    Appropriations as shown on the enclosed Budget Request sheet. This is
    the minimum amount that the Executive Committee of the Association
    feels is necessary to adequately fund the projects and maintain the
    proposed schedules during the coming fiscal year.
        The amount of $4,350,000 included in the President's Budget for
    Construction on the St. Francis River Basin Project in Arkansas and
    Missouri is sufficient to allow for adequate progress on the projects
    within the Basin. However, the amount of $6,300,000 included in the
    President's Budget for Maintenance within the St. Francis Basin is not
    sufficient to adequately maintain the existing projects and keep them
    in a good state of repair. Therefore, I am requesting an additional
    capability in the amount of $3,250,000 be added to the budget to
    provide for a total of $9,550,000 in maintenance funds for the fiscal
    year for use in the St. Francis Basin Project. The amounts requested
    are part of the total Mississippi River and Tributary Appropriations of
    the Civil Works Budget.
        I feel the Subcommittee will give fair consideration to the needs
    of the Mississippi River and Tributaries Appropriations. I appreciate
    the time given and the work you do to advance the development of the
    water resource projects.
        We have a large number of members from the St. Francis Levee
    District here today to attend the Appropriations Hearings. They have
    come to show their support for the St. Francis Basin Project and the
    Mississippi River and Tributaries Projects.
                                     ______

           Prepared Statement of Wayne Orillion, President, Board of
        Commissioners, Atchafalaya Basin Levee District, Port Allen, LA

                        atchafalaya basin levee district
        The Atchafalaya Basin Levee District was created in 1890 by the
    Louisiana Legislature and is the largest levee district in the State.
    The flood protection system within the District includes levees on the
    Mississippi River, Atchafalaya River, Morganza Lower Guide and East and
    West Atchafalaya Basin Protection Levees. The District is charged with
    the obligation of securing and clearing interfering facilities for
    rights-of-way for levee and levee drainage purposes, routine levee
    maintenance, borrow pit maintenance, and land management including oil,
    gas, mineral, campsites, hunting, and other leases.
        mississippi river and tributaries atchafalaya basin, la project
        The Atchafalaya River Basin, in south-central Louisiana, originates
    at the confluence of the Mississippi, Red, and Atchafalaya rivers near
    Simmesport. The basin extends in a north-south direction from the
    latitude of Old River and Bayou Des Glaises to the Gulf of Mexico.
        The Atchafalaya River is the largest of all distibutaries of the
    Mississippi. Improvements in the Atchafalaya River Basin have been
    authorized by Congress and constructed primarily under the Mississippi
    River and Tributaries (MR&T) project. Basin flood protection works are
    an integral and extremely important part of the lower Mississippi
    River. The project allows one-half of the project design flood (1.5
    million cubic feet per second) to be introduced into the Atchafalaya
    Basin Floodway while the other half is allowed to continue down the
    main Mississippi River channel. Floodways follow opposite sides of the
    Atchafalaya River to the end of the levee system along the river. There
    they merge into a single broad floodway that discharges into the Gulf
    of Mexico through Wax Lake Outlet and the Lower Atchafalaya River.
        Features of the Atchafalaya Basin, Louisiana project include
    levees, channel dredging, locks, floodgates, control structures,
    Morganza Floodway and Control Structure, pump stations, drainage
    structures, and drainage canals and enlargements.
             levee slides, west atchafalaya basin protection levee
        A levee slide is a partial levee failure brought on by the soil's
    properties of shrinking and swelling. This condition is affected by the
    soil's moisture content and results in a reduced shear strength. As the
    shear strength is reduced, the levee's ability to hold itself up is
    reduced until a portion of the levee breaks off.
        There are currently six levee slides at five locations along the
    West Atchafalaya Basin Protection Levee. Each slide area is shown in
    the table below.

    ------------------------------------------------------------------------
                                                               Slide length
                 Item                    Levee stations            (Ft.)
    ------------------------------------------------------------------------
    W-46.........................         2552+27 to 2573+38           2,111
    W-52.........................         2800+00 to 2900+00          10,000
    W-58.........................         3047+00 to 3054+00             700
    W-64.........................         3416+00 to 3424+00             800
    W-64.........................         3499+00 to 3503+00             400
    W-74.........................         3923+00 to 3927+00             400
    ------------------------------------------------------------------------

        These slides are of great concern to the Levee District and are in
    need of immediate attention. Traditionally, the levee district repairs
    minor slides in its normal maintenance program. However, the larger
    failures which involve engineering expertise and funding beyond the
    means of the levee district are the responsibility of the Corp of
    Engineers. In some cases the slides occur partially due to lack of
    proper compaction during the original construction process. The
    estimated cost to repair the slides is $4.2 million.
        The Board of the Atchafalaya Basin Levee District respectfully
    requests that the funds presented in the President's budget for the
    Flood Control, Mississippi River and Tributaries, Atchafalaya Basin,
    Louisiana project, Operation and Maintenance be increased by $4.2
    million and that this $4.2 million be designated for the levee slide
    repairs.
    [GRAPHIC] [TIFF OMITTED] T10NDP.012

                                     ______

         Prepared Statement of Reynold S. Minsky, President, Board of
          Commissioners, Fifth Louisiana Levee District, Tallulah, LA

        As each spring passes, the people of Louisiana sigh with relief.
    Another ``high River'' season is over and all is well, yet each spring
    draws the region closer to the inevitable, ``Project Flood.'' That
    surge of water flowing south, down the Mississippi River Channel,
    draining 41 percent of the United States at a level not experienced
    since 1927.
        If it were to happen this spring, Louisiana and Mississippi would
    not be prepared. Levees insufficient in height would give way to the
    force beyond their capabilities to constrain. Lives would be lost and
    livelihoods destroyed that would take decades to restore. The cost of
    restoring and rebuilding would be unequaled by any natural disaster
    America has suffered.
        Funding for adequate flood control in the Mississippi Valley now
    will be minimum compared to the potential that exists if flood control
    projects are not completed as currently planned.
        The fiscal year 2000 Civil Works Budget, Mississippi River and
    Tributaries (MR&T) Appropriations includes a total of $23,250,000 for
    ``Mississippi River Levees, IL, KY, MO, AR, TN, MS & LA.'' Insufficient
    to divide among seven states and be able to show significant
    improvement in flood control.
        To guarantee that the Vicksburg District, Corp of Engineers is able
    to maintain the level of progress needed to ensure MR&T construction
    schedules are met, it is imperative that an additional $5,500,000 above
    the $9,750,000 proposed budget be allocated for construction in the
    Vicksburg Corp District. Another $400,000 will be necessary for proper
    levee maintenance.
        The Mississippi River Levee System in Louisiana and Mississippi
    must be brought to heights and capabilities equal to that of the levees
    stretching northward; otherwise, upper reaches of the Mississippi River
    Levee System will become a funnel, protecting states to the north while
    directing havoc southward. Increased funding for MR&T levee improvement
    projects in Louisiana and Mississippi is the only means to eliminate
    this possibility.
                                     ______

         Prepared Statement of Audrey J. LaPlace, President, Board of
            Commissioners, Pontchartrain Levee District, Lutcher, LA

        These three items are of indispensable importance to the State of
    Louisiana. There are serious project deficiencies in the Pontchartrain
    Levee District. Federal appropriations must continue at adequate levels
    to move forward.
    $42,000,000 for Mississippi River levees (Budget contains $23,250,000)
        In the Pontchartrain Levee District several reaches of main line
    levee must be enlarged and slope paved to advance from the current
    status of partial flood protection. During the 1997 high water an
    emergency levee cap was constructed at Marchand to prevent overtopping
    and a possible crevasse. Enlargement and Slope Pavement construction
    for the levee reach Marchand to Darrow is now completed, as are two
    other items, Romeville to Remy and Remy to Garyville; all three items
    accomplished while the Sierra Club's consent decree has been in effect.
    This is a credit to the Corps of Engineers. After slipping out of the
    program for the past two years, funds are now badly needed for
    construction of the levee from Carville to Marchand.
        Future levee enlargements and slope paving are required in the
    Levee District. The Board of Commissioners, Pontchartrain Levee
    District, urges the Subcommittees to appropriate $42,000,000 in fiscal
    year 2000 for Mississippi River levees.
    $50,000,000 for channel improvement (Budget contain $37,685,000)
        Main line levees must be protected from caving banks throughout
    this lower river reach where extremely narrow battures are the last
    line of defense against levee crevasses and failures. If caving banks
    are not controlled the only answer is ``setback''. Simply stated there
    is no room remaining for levee setbacks in the Pontchartrain Levee
    District. Revetment construction must be annually funded to prevent
    levee failures, land losses and relocations. This item also benefits
    the 55-foot depth navigation channel. The Pontchartrain Levee District
    recommends at least $50,000,000 be appropriated for fiscal year 2000.
    $10,000,000 for Louisiana State Penitentiary (Budget contains
            $3,000,000)
        Angola, Louisiana's State Penitentiary, has been under River attack
    for more than ten years, lost its front line levee and hundreds of
    acres agricultural areas to caving banks. The Setback levee is
    extremely unstable, likely to fail under stress of the next high water.
    Warden Burl Cain describes the situation as an acute emergency. Inside
    the prison the City of Angola does exist, has its own Post Office, a
    population of 627 tax paying citizens, and 138 residences. With a levee
    failure potential damages amount to $500,000,000. Currently, the only
    alternative is to move the 5,000 maximum security inmates into tents on
    higher ground. It is urgently recommended that $10,000,000 be
    appropriated for fiscal year 2000.
    $325,000,000 minimum recommended for all items of the MR&T flood
            control project
                               the levee district
        The Pontchartrain Levee District extends downstream from the City
    of Baton Rouge to the New Orleans area, a distance of 115 river miles,
    includes the east (left descending) bank of the Mississippi River, and
    is comprised of portions of East Baton Rouge, Iberville, Ascension, St.
    James, St. John the Baptist and St. Charles Parishes. The Mississippi
    River east bank levee is continuous throughout the Levee District,
    including the Bonnet Carre Floodway. We serve as the local sponsor for
    the St. Charles Parish Hurricane Protection Levee, now in the eighth
    year of construction, designed to protect the Parish, a portion of New
    Orleans and its International Airport from hurricane tides. The West
    Shore Hurricane Protection Project, St. John the Baptist Parish, is now
    involved in a Feasibility Study and this Levee District is again
    serving as Local Sponsor.
        Extensive development of major industries has taken place in the
    Pontchartrain Levee District and is continuing. Along with industrial
    growth, our Levee District is experiencing dramatic increase in
    residential and urban expansions. Substantial portions of the Levee
    District area are used for agriculture. Three nationally ranked deep-
    water ports are companions to the Pontchartrain Levee District--the
    Baton Rouge Port, South Louisiana Port, and New Orleans Port. A portion
    of the New Orleans International Airport is also located within the
    district.
        All these features and many other improvements along with more than
    one million residents are protected by the Mississippi River and
    Tributaries Flood Control Project in this Levee District. Only through
    continuous, effective flood control improvements and maintenance can
    this area and the Lower River Valley meet requirements to serve
    national needs for its economy and continued growth.
                                    comments
        The Pontchartrain Levee District has full realization of the
    necessity of keeping this Subcommittee advised of current and future
    needs for federal monetary support on vital items of the MR&T Flood
    Control Project. In 1995, 1996 and 1997 the Subcommittees refused to
    give audience to the Lower Mississippi Valley Flood Control Association
    seven (7) state delegation. This year we have been advised that no oral
    testimony will be heard. Again, this is a great travesty of justice.
    Such actions seriously erode the partnership that has been built
    between the Corps of Engineers and local sponsors. We trust that this
    pattern will revert back to the sixty-three year practice of hearing
    our delegation. Four representatives from the Pontchartrain Levee
    District are present today desiring to present views to the
    Subcommittees--they are Commissioner Joseph Gautreau, Vice President;
    Commissioner LeVerne B. Brown; Commissioner Michael Reames; and Gerald
    Dyson, Executive Assistant.
                  near future is uncertain--its up to congress
        In the search for new ways to accomplish required flood control and
    other water resources projects, Congress must remain mindful not to
    jerk the rug out from under its own feet and our own. Without
    protection there will be few jobs, farms, industries, businesses,
    voters and related activities. Congress should know that we in the
    Lower Mississippi Valley do not have the option to say ``No''. Also it
    stands that Congress should not have the option to reduce, remove or
    stop federal responsibility for controlling national water, whether in
    flood or drought. With respect to Louisiana most of its runoff is
    generated outside the State area for all its main carrier rivers,
    including Mississippi, Red, Ouachita, Black, Atchafalaya Floodway,
    Pearl and Sabine Rivers. In Louisiana we have a comprehensive flood
    control plan sponsored, operated and maintained by some 23 Levee
    Districts to handle and provide for safe passage of almost one half the
    nation's waters. This invokes federal involvement, don't mess up the
    system.
                                   conclusion
        The Board of Commissioners, Pontchartrain Levee District,
    compliments the Subcommittee on Energy and Water Development for its
    keen understanding of real needs for the MR&T Flood Control Project and
    efficient, alert actions taken to appropriate funds for its many
    complex requirements. We endorse recommendations presented by the
    Association of Levee Boards of Louisiana, Louisiana Department of
    Transportation and Development, Mississippi Valley Flood Control
    Association and Red River Valley Association.
                                     ______

    Prepared Statement of Aubrey J. LaPlace, President, President, Board of
            Commissioners, Pontchartrain Levee District, Lutcher, LA

        in support of appropriations for lake pontchartrain & vicinity
       hurricane protection, louisiana--st. charles parish and west shore
                                  the projects
        These recommendations are limited to two separable items under the
    project ``Lake Pontchartrain & Vicinity, Hurricane Protection,
    Louisiana'', (1) St. Charles Parish authorized in 1965 and (2) West
    Shore, St. John the Baptist Parish, authorized in 1974. Federal funding
    is required for construction on (1) St. Charles Parish and Feasibility
    Study on (2) West Shore.

    Funding requirements, fiscal year 2000

    St. Charles Parish, Construction........................      $6,000,000
    West Shore, Feasibility Study...........................         600,000
                                   objectives
        St. Charles Parish.--The Accelerated Plan has been developed in
    conjunction with the Corps of Engineers whereby the ten mile levee
    system first lift and drainage structures can be completed in a five
    year period, providing a closed system and protection from hurricane
    tides to elevation 9.0. We are now entering the second year of the five
    year plan. Additional levee lifts will be added to raise the levee
    system to elevation 13.5 as consolidation will allow.
        West Shore.--The Feasibility Study is moving satisfactorily and
    must be completed on schedule, two more years. Local 50 percent funding
    has been deposited in an escrow account, matching federal funds are now
    required.
                              project descriptions
        The St. Charles Parish Hurricane Protection Levee is ten miles in
    length, has five drainage structures, extends from the Bonnet Carre
    Floodway to New Orleans International Airport and is situated about
    four hundred feet north of U.S. Hwy. 61. Construction cost is estimated
    at $99,000,000 financed at 70 percent Federal and 30 percent Local
    (Pontchartrain Levee District). Project is now 30 percent complete.
    Local contributions have been deposited in an escrow account and now
    exceed the 30 percent local funding requirement compared to federal
    funds. When the first lift and structures are completed, immediate
    protection to elevation 9.0 will be in place, whereas now there is
    nothing to prevent extensive, devastating flooding in St. Charles
    Parish, a portion of Jefferson Parish and New Orleans International
    Airport. Then additional lifts will be added to raise the levee to
    elevation 13.5 as consolidation will allow.
        The West Shore Hurricane Protection Levee will provide tidal
    flooding protection to the Town of LaPlace and vicinity, St. John the
    Baptist Parish. Other improvements to be protected are reaches of I-10
    and I-55 along with U.S. Highways 61 and 51, and State Highways. These
    are designated evacuation routes for New Orleans metro area. The
    Benefit/Cost ratio is 2.1, and estimated construction cost is
    $60,000,000. The Pontchartrain Levee District is serving as Local
    Sponsor in partnership with St. John the Baptist Parish Council.
        These are two critical emergency projects, we have local funds now
    available, and the next move is in the hands of Appropriation
    Subcommittees on Energy and Water Development. You must act now.
        Representatives of the Pontchartrain Levee District appeared at the
    Subcommittee Staff Office to submit this statement and answer any
    questions. They are Commissioners Joseph Gautreau, Vice President,
    Commissioner Michael Reames, Commissioner LeVerne B. Brown and Gerald
    Dyson, Executive Assistant. You may call either of them or the
    undersigned at any time for information, (225) 869-9721.
                                     ______

    Prepared Statement of Kenneth L. Weiland, P.E., CEO and Chief Engineer,
                   Yazoo-Mississippi Delta (YMD) Levee Board
        This statement has been prepared by Kenneth L. Weiland, P.E., CEO
    and Chief Engineer for the Yazoo-Mississippi Delta (YMD) Levee Board.
    It is submitted today, March 23, 1999, on behalf of the entire Levee
    Board and the citizens we represent in the Mississippi Delta, which
    includes the Yazoo and Sunflower River Basins. In addition to the
    funding request contained herein, the YMD Levee Board also supports the
    general funding testimony for fiscal year 2000 as submitted by the
    Mississippi Valley Flood Control Association. As members of this
    Association, we join in their praises of your continuing support for
    the important flood control projects within the Mississippi River and
    Tributaries (MR&T) Project.
        We are very concerned about the Administration's continued
    submittal of budgets containing severely inadequate funding levels for
    flood control projects within the MR&T project. Consequently, both
    Levee Boards in Mississippi are making efforts to address these
    concerns with key Administration officials as well as our Congressional
    delegations. It is our desire to facilitate better support and
    understanding of the importance of the MR&T project by policy and
    budget decision makers within the Administration to reduce or eliminate
    the complete Congressional overhauls of the MR&T budget that have been
    required in recent years.
        After careful consultation with U.S. Army Corps of Engineers
    officials, the YMD Levee Board continues our support and request for a
    minimum annual funding level of 335 million dollars for the timely
    completion and maintenance of the MR&T project. Following the
    devastating flood of 1927 on the Mississippi River, the Flood Control
    Act of 1928 verified the national priority placed on the development of
    a comprehensive flood control plan (the MR&T project) to minimize the
    likelihood of such devastation occurring again in the lower Mississippi
    valley. The wisdom of this Act is obvious today, seventy-one years
    later, by the fact that the project has yielded 20 dollars of benefits
    for every dollar invested in the project. Unfortunately, however, a
    substantial amount of work is still uncompleted on the project that
    exposes many areas to the risk of flood devastation. The YMD Levee
    Board makes its most urgent and ardent appeal that proper funding be
    provided by Congress for the MR&T project. Your past support of this
    vital work verifies your recognition of the consequences to the nation
    that would result from allowing the MR&T project to become vulnerable
    to a catastrophic failure of any one of its major components due to
    delays and neglect caused by inadequate funds.
        The following paragraphs identify certain projects within our Levee
    District that merit special mention. For your convenience, we have
    provided a detailed, tabular listing of key components of our funding
    request for fiscal year 2000 at the end of this statement. As you will
    note, the requested funding levels in the table are supported jointly
    by both Levee Boards in Mississippi.
               mississippi river levees and channels maintenance
        As stated above, there can be no question of the importance of the
    continued construction and maintenance of the mainline levee system and
    channel protection on the Lower Mississippi River. The YMD Levee Board
    is proud of our long record of protection of the mainline levee in our
    District and understands that your generous funding to insure adequate
    major maintenance of these features of the project is the key to
    preventing a catastrophic failure of the system. Again we emphasize the
    importance of adequate funding of the MR&T project, especially with
    respect to maintenance of the mainline levees and the Mississippi River
    channel.
                              upper yazoo projects
        Following the destructive flood of 1932, Congress authorized the
    formulation of a plan that would reduce the risk of flooding of the
    Mississippi Delta from the uncontrolled release of headwater out of the
    hills in north central Mississippi. The original plan, released in
    1936, included a system of flood control reservoirs that would
    discharge into a system of channels and levees that could safely convey
    the headwater from the hills to the Mississippi River. In the late
    1980's, this project was forced into reformulation under the guise of
    environmental concern. Reformulation of the Upper Yazoo Project (UYP)
    was completed in late 1993. Construction was immediately resumed on the
    project, and outstanding progress has been made since. The tabular
    funding request attached to the end of this statement reflects a
    request for the funding necessary to assure that progress on the UYP
    continues. The requested funding will support the necessary work to
    complete the UYP to the city of Greenwood, MS, long considered a
    milestone in the overall completion of the project. The YMD Levee Board
    is very appreciative of the Congressional support of this project in
    past appropriations and respectfully requests funding as shown to
    assure that construction on this project can proceed as rapidly as
    possible to completion.
                    yazoo headwater flood control reservoirs
        As mentioned above, four major flood control reservoirs exist in
    Mississippi to control the release of headwater into the Yazoo River
    system. These reservoirs are Arkabutla, Sardis, Enid and Grenada. The
    reservoirs have prevented an enormous amount of flood damages by
    allowing drainage from the hills to be released into the Delta at a
    rate that prevents flooding. The proper maintenance and operation of
    these reservoirs is therefore critically important to all citizens
    living downstream of them in the Delta. The YMD Levee Board has
    specified a reasonable request for maintenance funding of the
    infrastructure associated with these reservoirs. Providing the
    requested funding will allow the Corps to make the necessary repairs
    and operational improvements consistent with the critical role these
    reservoirs play in protecting the Mississippi Delta.
                  sunflower river channel maintenance project
        Over time, all streams in the Delta lose their capacity to convey
    design discharges due to siltation in the bottom of the streams. In the
    month of July, 1989, sections of the Mississippi Delta along the
    Sunflower River system experienced significant flooding over half grown
    row crops of food and fiber. In response to this devastation, the Board
    of Mississippi Levee Commissioners (MLB), located in Greenville, MS,
    requested a study by the Corps of Engineers (Corps) to determine
    whether the reduction of the Sunflower River system flow capacities had
    contributed to the flooding, and thus, whether the Corps should begin
    its obligatory maintenance of the channels in this system. Subsequent
    surveys by the Corps reflected loss of channel capacity from the
    original design of approximately forty (40) percent. Studies were made
    and plans completed by the Corps for the work necessary to perform this
    major maintenance. The YMD Levee Board, whose District shares in the
    damages resulting from the overflow of the rivers in this area, and the
    MLB serve as the local sponsors of this project and have joined as
    intevenors on behalf of the Corps to defend this work from litigation
    that has been filed to delay this important work. We are very
    optimistic that all legal roadblocks will be removed and urge the
    requested funding levels be provided so that no delays occur once these
    litigation matters have been resolved.
                     demonstration erosion control project
        In past years, Congress has provided funds for the continuation of
    construction of measures to control erosion and sedimentation in
    streams located primarily in the headwater area of the Yazoo Basin.
    Though most of this work is located outside of the physical limits of
    our District, the YMD Levee Board supports your continued funding of
    these projects due to the fact that substantial amounts of the
    sediments controlled by the projects would eventually end up in the
    Coldwater-Tallahatchie-Yazoo River system. Such sedimentation would
    result in significant additional maintenance on this system to prevent
    the loss of capacity of these rivers to carry the design discharges
    from the four major flood control reservoirs. (Arkabutla, Sardis, Enid,
    Grenada)
                            yazoo tributaries study
        The Yazoo Tributaries Study is the last phase of the MR&T project
    in the Yazoo Basin. This study will identify work necessary for proper
    drainage and flood control on the major tributaries to the Yazoo River
    system. Upon completion of the before stated UYP, construction on these
    tributary streams can begin. The YMD Levee Board therefore urges
    Congress to provide adequate funding for the timely completion of this
    study.

    ----------------------------------------------------------------------------------------------------------------
                                                                                    Fiscal year 2000--
                                                                     -----------------------------------------------
                                                                                         MLB Levee
                                 Project                                President's     Board, YMD       Requested
                                                                         submitted      Levee Board    congressional
                                                                          budget          funding         add-ons
                                                                                          request
    ----------------------------------------------------------------------------------------------------------------
                               Yazoo Basin

    Construction:
        Upper Yazoo Project.........................................     $11,620,000     $13,700,000      $2,080,000
        Upper Steele Bayou..........................................       3,915,000       4,500,000         585,000
        Tributaries.................................................         340,000         340,000  ..............
        Yazoo Backwater.............................................         520,000       1,000,000         480,000
        Reformulation (backwater & tributaries).....................       1,570,000       1,570,000  ..............
        Demonstration Erosion Control...............................       6,294,000      20,000,000      13,706,000
    Maintenance:
        Big Sunflower River.........................................         209,000       4,800,000       4,591,000
        Tributaries.................................................       1,269,000       1,300,000          31,000
        Arkabutla...................................................       3,265,000       4,900,000       1,635,000
        Sardis......................................................       4,334,000       7,300,000       2,966,000
        Enid........................................................       3,214,000       4,400,000       1,186,000
        Grenada.....................................................       4,280,000       6,600,000       2,320,000

                        Mississippi River Levees

    Construction:
        MS Valley Division..........................................      23,250,000      35,750,000      12,500,000
            Memphis District........................................       7,500,000      13,500,000       6,000,000
            Vicksburg District......................................       9,750,000      15,300,000       5,550,000
    Maintenance:
        MS Valley Division..........................................       3,736,000       4,686,000         950,000
            Memphis District........................................       1,460,000       2,410,000         950,000
            Vicksburg District......................................       1,269,000       1,700,000         431,000
    ----------------------------------------------------------------------------------------------------------------

        The figures provided in the table above are based on our assessment
    of projected Corps capabilities using the best information available as
    of 17 March, 1999. The YMD Levee Board and the MLB Levee Board support
    funding at the full capability of the Corps in order to complete our
    important flood control projects in a timely and effective manner.
    Please do not hesitate to call us if you have questions or comments
    regarding this information.
                                     ______

      Prepared Statement of James E. Wanamaker, Cheif Engineer, Board of
                        Mississippi Levee Commissioners
        Mr. Chairman and members of the committee: I am James E. Wanamaker,
    Chief Engineer for the Board of Mississippi Levee Commissioners,
    Greenville, Mississippi, and I have the privilege of presenting this
    statement on behalf of this Board and the Citizens of the Levee
    District. Our Levee District consists of the counties of Bolivar,
    Issaquena, Sharkey, Washington, and parts of Humphreys and Warren in
    the Lower Yazoo Basin in Mississippi.
        As in past years, we remind you that the Mississippi River and
    Tributaries Project is one of if not the most cost-effective projects
    ever undertaken by the United States. The foresight used by the
    Congress in their authorization of the many features of this project is
    exemplary. Annual funding for this project needs to be $350,000,000 for
    construction to stay on schedule. We continue to be aware of the desire
    of the Congress to balance the Federal budget and appreciate the effort
    made by the Congress to provide the maximum funding available for this
    work. The Congressional adds for fiscal year 1999 have kept
    construction moving in the Basin at an acceptable pace. The Lower
    Mississippi Valley Flood Control Association will be submitting a
    general statement in support of the appropriation of $335,000,000 for
    fiscal year 2000 for the construction, surveys, advanced engineering
    and the operation and maintenance of the Mississippi River and
    Tributaries Project. The Lower Mississippi River receives flood water
    from 41 percent of the continental United States and has experienced
    water levels above flood stage for the past 6 years.
        The President's Budget request again falls far short of the needs
    and capabilities of the Corps of Engineers for the Mississippi River
    and Tributaries Project that includes work on the Mainline Mississippi
    River Levees and the Yazoo Basin Projects. The following table outlines
    what the Congress appropriated last year, the President's Budget
    request and our request for your consideration while deliberating the
    appropriation for this year.

                            YAZOO BASIN FLOOD CONTROL FISCAL YEAR 2000 APPROPRIATIONS SUMMARY
    ----------------------------------------------------------------------------------------------------------------
                                                                                       Fiscal year--
                                                                     -----------------------------------------------
                                 Project                                                   2000         2000 Levee
                                                                           1999         President's    Board (Local
                                                                      Appropriations  Budget Request     Sponsor)
    ----------------------------------------------------------------------------------------------------------------
    Construction:
        Yazoo Backwater.............................................        $500,000        $520,000      $1,000,000
        Upper Steele Bayou..........................................       4,500,000       3,915,000       4,500,000
        Demonstration Erosion Control...............................      13,500,000       6,294,000      20,000,000
        Tributaries.................................................         200,000         340,000         340,000
        Upper Yazoo Project.........................................      10,000,000      11,620,000      13,700,000
    Maintenance:
        Big Sunflower...............................................       2,500,000         209,000       4,800,000
        Arkabutla...................................................       3,700,000       3,265,000       4,800,000
        Enid........................................................       3,270,000       3,214,000       4,400,000
        Grenada.....................................................       4,330,000       4,280,000       6,600,000
        Sardis......................................................       5,300,000       4,334,000       7,300,000
        Tributaries.................................................       1,238,000       1,269,000       1,300,000
                                                                     -----------------------------------------------
          Total.....................................................      49,038,000      39,260,000      68,740,000

                        Mississippi River Levees

    Construction:
        Vicksburg District \1\......................................      14,850,000       9,750,000      15,300,000
        Lower MS River Valley Division \2\..........................      30,750,000      23,250,000      35,750,000
    Maintenance:
        Vicksburg District \1\......................................       2,251,000       1,269,000       1,600,000
        Lower MS River Valley Division \2\..........................       6,500,000       3,736,000       4,686,000
    ----------------------------------------------------------------------------------------------------------------
    \1\ Vicksburg District includes portions of the states of Mississippi, Arkansas, and Louisiana.
    \2\ Lower MS Valley Division includes portions of the states of Illinois, Missouri, Kentucky, Tennessee,
      Arkansas, Mississippi, and Louisiana.

        It is imperative that the work on the Mainline Mississippi River
    Levee Enlargement Project move forward as fast as funding will allow.
    We are requesting an appropriation for mainline levees of $35.75
    million, which will allow the continuation of two construction
    contracts enlarging 18 miles of the most deficient levee in Mississippi
    near Mayersville. These additional funds will also allow the initiation
    and completion of relief wells on the Magna Vista to Brunswick Item
    protecting our area of greatest underseepage problems during the recent
    high waters.
        The Reformulation of all remaining work in the Yazoo Basin has
    delayed construction for as much as 5 years on the Upper Steele Bayou
    and Upper Yazoo Projects. Our request includes additional funding
    necessary to assure that construction continues on the remaining
    projects in the Yazoo Basin.
        Our request includes $4.5 million for the Upper Steele Bayou
    Project which will allow the Vicksburg District to complete Main Canal
    Item 2 which comes up through the City of Greenville and also Item 2 on
    Black Bayou. This funding increase will also allow for the award of
    Black Bayou Item 3 which also provides drainage to Greenville,
    Mississippi. The Vicksburg District will be able to complete phase 4 on
    Item 66-A at Swan Lake as part of the ongoing work at the Yazoo
    Wildlife Refuge.
        One million dollars is requested for the Vicksburg District to
    initiate the design for the project in anticipation of the completion
    of the Reformulation Report. Preliminary information indicates that
    there will be an alternative with a positive benefit cost ratio. The
    Mississippi Levee Board is currently scheduling meetings with public
    and private environmental groups in an effort to arrive at a plan for
    this project to provide flood protection and environmental benefits to
    the South Delta area.
        We are requesting $4.8 million to initiate construction of Items 2
    and 3 on the Big Sunflower Maintenance Project. The Big Sunflower River
    is the outlet for a major portion of the Mississippi Delta, including
    parts of 10 Counties. This is also the outlet relied upon for 60
    Drainage Districts in the Mississippi Delta. The two Mississippi Levee
    Boards are currently intervenors in both the State and Federal
    litigation involving the work planned for this project. It is our
    opinion that the Corps of Engineers has made a strong argument in both
    cases and with out these funds construction will be delayed at least a
    year with the successful out come of this litigation.
        Our request also includes additional funding for the Upper Yazoo
    Project and maintenance of the Mississippi Reservoirs that provide
    protection to the eastern portion of the Mississippi Delta. The
    increased funding will allow the Upper Yazoo Project to continue
    upstream to Greenwood and the reservoir funding will allow the Corps to
    complete long awaited maintenance on our four lakes and Dams.
    Demonstration Erosion Control and Tributaries features of the Yazoo
    Basin Appropriation will reduce sediment to the Delta streams reducing
    long term maintenance needs.
        We are grateful for the consideration given to us each year by the
    Committee and appreciate the opportunity to present our requests to you
    at this time.
                                     ______

        Prepared Statement of A. Lynn Lowe, President, Red River Valley
                                  Association
                                  introduction
        The Red River Valley Association is a voluntary group of citizens
    banded together to advance the economic development and future well-
    being of the citizens of the four state Red River Basin area in
    Arkansas, Louisiana, Oklahoma and Texas.
        For the past 74 years, the Association has done notable work in the
    support and advancement of programs to develop the land and water
    resources of the Valley to the beneficial use of all the people. To
    this end, the Red River Valley Association offers its full support and
    assistance to the various Port Authorities, Chambers of Commerce,
    Economic Development Districts and other local governmental entities in
    developing the area along the Red River.
        The Resolutions contained herein were adopted by the Association
    during its 74th Annual Meeting in Bossier City, Louisiana on February
    18, 1999, and represent the combined concerns of the citizens of the
    Red River Basin area as they pertain to the goals of the Association,
    specifically: Economic and Community Development; Environmental
    Restoration; Flood Control; Bank Stabilization; A Clean Water Supply
    for Residential, Commercial, Industrial and Agriculture Uses;
    Hydroelectric Power Generation; Recreation; and Navigation The.
        Red River Valley Association is aware of the constraints on the
    federal budget, and has kept those restraints in mind as these
    Resolutions were adopted. Therefore, and because of the far-reaching
    regional and national benefits addressed by the various projects
    covered in these Resolutions, we urge the members of Congress to review
    the materials contained herein and give serious consideration to
    funding the projects at the levels requested.
                                 rrva testimony
        Mr. Chairman and members of the Committee. I am Lynn Lowe, and I am
    pleased to represent the Red River Valley Association as its President.
    Our organization was founded in 1925 with the express purpose of
    uniting the citizens of Arkansas, Louisiana, Oklahoma and Texas to
    develop the land and water resources of the Red River Basin.
        We appreciate the President's fiscal year 2000 budget submission of
    $3.9 billion from his fiscal year 1999 submission of $3.3 billion (21.5
    percent increase); however, we take exception to the programs earmarked
    for the increase. Most all of it will go to deep-draft ports and
    channels and environmental programs. The traditional programs, inland
    waterways and flood protection remained at the low, unacceptable level
    as last year. These traditional civil work projects are the backbone to
    our nation's infrastructure for waterways, flood control and water
    supply. We remind you that these projects are a true `jobs program' in
    that 100 percent of the construction is contracted to the private
    sector as is much of the architect and engineer work. Not only do these
    funds provide jobs, but provide economic development opportunities for
    our communities to grow and prosper.
        The civil works program is a catalyst that is responsible for the
    great economy we now experience. It would be irresponsible to allow our
    nation's infrastructure to deteriorate, or worse, stop its growth in a
    time when America must be the leader in the world market. Our inland
    waterways is the key to our dominance in world trade. This is a pivotal
    budget year where critical decisions must be made which will determine
    our future economic strength.
        We ask you to correct this imbalance in distribution of funds
    within the Corps and to fund the Corps of Engineers at the level of
    $4.7 billion which will realistically fund the ongoing programs. We
    also request you place in your budget language that recognizes the
    importance of our nation's waterways and the positive economic impact
    civil work activities have to our citizens.
        I would like to comment on our specific requests for the future
    economic well-being of the citizens residing in the four state Red
    River Basin area.
        Navigation.--The J. Bennett Johnston Waterway is living up to the
    expectations of the benefits projected. The average tonnage moved in
    1995 through 1997 was 3.1 million tons and the projected tonnage to
    justify the project is 3.3 million tons. Estimates for 1998 are 3.4
    million tons. We are extremely proud of our public ports,
    municipalities and state agencies who have created this success. New
    facilities opened in 1998 included a fertilizer terminal at Alexandria
    and stone distribution at the Port of Shreveport-Bossier. Liquid
    petroleum shipments increased in 1998 as did commercial stone
    operations. Currently under construction, at our ports, are a wood chip
    barge loading system, new liquid petroleum tank farm, fertilizer
    facility and two general cargo warehouses. You are reminded that the
    Waterway is not complete, ten percent remains, $200 million. We
    appreciate the President's budget level of $21 million; however, we
    respectfully request the expressed Corps capability of $25.1 million.
    In order to keep the waterway safe and reliable we must continue at a
    funding level higher than the President's Budget. The RRVA formed a
    Navigation Committee for industry, the Corps and Coast Guard to partner
    in making our Waterway a success. This effort has reaped many benefits.
    We can not sacrifice what has been accomplished by inadequate funding
    levels.
        In fiscal year 1999 you reprogrammed funds to initiate the
    feasibility study to extend navigation from Shreveport-Bossier City,
    Louisiana into the State of Arkansas. It is imperative that you
    continue funding this important study and reprogram the remaining
    $582,600 from the `Daingerfield Reach' study. Many areas continue to
    suffer major unemployment, and the navigation project, although not the
    total solution, will help revitalize the economy in this region. The
    U.S. Fish and Wildlife Service `Planning Aid Report' indicated minimal
    impact and most probably an enhancement to environmental value. Last
    summer colonies of least terns (an endangered species) were found on
    stabilized sandbars in the Waterway in Louisiana as well as increased
    migratory birds due to the newly formed pools. This will be a
    multipurpose project addressing navigation, hydropower, bank
    stabilization and environmental restoration. I want to stress that the
    local sponsor, the Red River Commission of Arkansas, has available
    their 50 percent cost share for the complete feasibility study. Few
    local sponsors have funds `in the bank' and are also willing to fund
    additional studies to insure a complete analysis is made.
        Bank Stabilization.--One of the most important continuing programs
    on the Red River is bank stabilization in Arkansas and North Louisiana.
    We must stop the loss of valuable farmland that erodes down river and
    interferes with the navigation channel. In addition to the loss of
    farmland is the threat to public utilities such as roads, electric
    power lines and bridges; as well as increased dredging cost in the
    navigable waterway. These revetment projects are compatible with
    subsequent navigation and we urge that they be continued in those
    locations designated by the Corps of Engineers to be the areas of the
    worst erosion. We appreciate Congressional funding in fiscal year 1999
    and request you again fund this project at a level of $17 million.
        It is essential to protect the banks from caving and erosion along
    the Red River below Denison Dam, Texas to Index, Arkansas along the
    Texas/Oklahoma border. The Federal Government constantly encourages its
    farmers to protect their lands against all forms of erosion, so it only
    makes sense to be consistent. An authorized project exists; `Red River
    Waterway, Index, AR to Denison Dam, TX, Bank Stabilization', so the
    issue lies with the benefit/cost ratio. We believe that the authorized,
    on going `Sediment Transport Study' will identify benefits due to
    reduced dredging cost to the navigable Waterway in Louisiana.
        There is a new technique for bank stabilization which could be
    tested as a demonstration project under this authorization. This new
    technique, underwater bendway weirs, has proven to be less expensive
    than conventional methods and more efficient in controlling the energy
    of the river as well as providing environmental benefits. Much prime
    farmland in Oklahoma and Texas is lost each year to river erosion and
    we must investigate all avenues to correct this problem. You funded the
    initiation of this project last year and we request you continue that
    funding this year at a level of $5.8 million, the expressed Corps
    capability.
        Flood Control.--You will recall that in 1990 major areas of
    northeast Texas, Southwest Arkansas and the entire length of the Red
    River in Louisiana were ravaged by the worst flooding to hit the region
    since 1945 and 1957. More than 700,000 acres were flooded with total
    damages estimated at $20.4 million. However, it could have been much
    worse. The Corps of Engineers estimates that without the flood control
    measure authorized by Congress over the past several decades an
    additional 1.3 million acres would have been flooded with an estimated
    $330 million in additional flood damage to agricultural and urban
    developments.
        We continue to consider flood control a major objective and request
    you continue funding the levee rehabilitation projects ongoing in
    Arkansas and Texas. Four of eleven items have been completed and levees
    rehabilitated to meet federal standards. $5 million will construct two
    more items; completing Miller County, AR and starting levees in
    Lafayette County, AR.
        In addition, Bowie County levee, in Texas, is crucial to the
    integrity of the Arkansas levee system. Should the Bowie levee fail
    flood waters will inundate behind the just completed Miller County
    levees in Arkansas. It is important to have this projected funded for
    $900,000, for the `locally preferred' option, according to cost sharing
    under the Flood Control Act of 1946 not withstanding economic
    justification.
        Clean Water.--Nearly 3,500 tons of natural salts, primarily sodium
    chloride, enter the upper reaches of the Red River each day, rendering
    downstream waters unusable for most purposes. The Truscott Brine Lake
    project, which is located on the South Fork of the Wichita River in
    King and Knox Counties, Texas became operational in 1987. An
    independent panel of experts found that the project not only continues
    to perform beyond design expectations in providing cleaner water, but
    has an exceptionally favorable cost benefit ratio. $16 million dollars
    was appropriated in fiscal year 1995, by the Administration, to
    accelerate engineering design, real estate acquisition and initiate
    construction of the Crowell Brine Dam, Area VII and Area IX. Due to a
    conflict over environmental issues, raised by the U.S. Fish and
    Wildlife Service, completion of the SFEIS was delayed pending further
    study to determine the extent of possible impacts to fish and wildlife,
    their habitats and biological communities along the Red River and Lake
    Texoma. In an effort to resolve these issues and insure that no harmful
    impact to the environment or ecosystems would result, a comprehensive
    environmental and ecological monitoring program was implemented. It
    evaluates the actual impacts of reducing chloride concentrations within
    the Red River watershed. This base line data is crucial to
    understanding the ecosystem of the Red River basin west of Lake Texoma
    and funding for this must continue.
        Dr. Westphal, Assistant Secretary of the Army (Civil Works), in
    October 1998 agreed to support a re-evaluation of the Wichita River
    Basin. Completion of this tributary will reclaim Lake Kemp as a usable
    water source for the region. We request the expressed Corps capability
    of $2.1 million to continue this important project.
        Operation & Maintenance.--We appreciate the support of your
    subcommittee to support the completion of navigation to Shreveport/
    Bossier City which is now providing an increase to our industrial base,
    creating jobs and providing economic growth. We request that O&M
    funding levels remain at the expressed Corps capability to maintain a
    safe, reliable and efficient transportation system. As experienced this
    past year failure to maintain a revetment for $500,000, when the
    problem was first identified, resulted in a catastrophic failure of the
    revetment and adjacent levee. This led to an emergency repair of $5
    million which could have been prevented. The President's level of $8.8
    million does not address the backlog of maintenance at the five lock
    and dams or deteriorating dikes and revetments. The Corps capability of
    $14 million is required to maintain a safe waterway. Full O&M funding
    levels is not only important for the Waterway Project but for all our
    Corps projects and flood control lakes.
        We are sincerely grateful to you for the past support you have
    given our various projects. We hope that we can count on you again to
    fund our needs and complete the projects started that will help us
    diversify our economy and create the jobs so badly needed by our
    citizens.
        Thank you for the opportunity to present this testimony and project
    details of the Red River Valley Association on behalf of the
    industries, organizations and citizens we represent throughout the four
    state Red River Valley region. We believe that any federal monies spent
    on civil work projects are truly investments in our future and will
    return several times the original investment in benefits that will
    accrue back to the federal government.
        I am always available to provide you and your staff additional
    information or clarification on any issue presented.
                                grant disclosure
        The Red River Valley Association has not received any federal
    grant, subgrant or contract during the current fiscal year or either of
    the two previous fiscal years.
       summary of fiscal year 2000 requests red river valley association
        [Note.--Projects are NOT in any order of priority. Project number
    correspond to the backup information in Section V.]
    A. Studies (General Investigations)
        1. Navigation on the Red River in Southwest Arkansas: WRDA 96
    authorized a feasibility study for this project. Funding was
    reprogrammed in fiscal year 1999 to continue the study. The Project
    Study Plan (PSP) is complete and the Feasibility Cost Sharing Agreement
    (FCSA) will be signed in March 99. The study will commence with full
    participation from the communities in the project area which include
    counties and parishes of Arkansas, Louisiana, Texas and Oklahoma. It is
    imperative that this study continue to be funded and the remaining
    funds in the `Daingerfield' study be reprogrammed for this study in
    Bill language.
        [Note.--The local sponsor is prepared to cost share the study, 50
    percent and has funds available.]
        ``Request that the Secretary of the Army is directed to use
    $582,600 of the funds appropriated in Public Law 102-377 for the Red
    River Waterway, Shreveport, Louisiana, to Daingerfield, Texas, project
    for the feasibility phase of the Red River Navigation, Southwest
    Arkansas, study.''
        2. Grassy Lake, AR: Project Modifications for Improvement of the
    Environment (Section 1135). The Secretary of the Army acting through
    the Chief of Engineers is requested to expend, within the funds
    provided for the Section 1135 Program; $300,000 for a feasibility study
    of modifications to restore the environmental quality of Grassy Lake,
    Hempstead County, Arkansas, degraded by the construction of Millwood
    Lake, Arkansas. Fiscal year 2000 Funds Requested: $300,000.
        3. Southwest Arkansas, Arkansas: Provided further, that the
    Secretary of the Army is directed to initiate a reconnaissance study in
    Southwest Arkansas utilizing $300,000 appropriated herein to develop an
    ecosystem restoration plan that integrates flood control, water supply,
    releases for navigation and wildlife habitat. The study will
    investigate adverse results caused by construction of Millwood,
    DeQueen, Dierks, and Gilham Lakes. Navigation has been extended to
    Shreveport/Bossier City, Louisiana, on the Red River, and water
    releases of these four lakes could be used to aid navigation. Flooding
    remains a problem and the lakes' water supply is not being utilized to
    its full benefits. Fiscal year 2000 Funds Requested: $300,000.
    B. Construction
        4. Red River Waterway Project, LA:
        a. We support the $21,113,000 included in the President's budget
    and items of work proposed by the Corps.
        b. In addition, to insure that the integrity and safety of the Red
    River navigation channel is maintained for reliable barge
    transportation we request additional funding, at the Corps expressed
    capability, to accelerate construction on Cognac Reinforcement
    ($1,250,000) and Poisson ACS ($1,250,000). These sites have been
    identified by industry as problem areas. Fiscal year 2000 Funds
    Requested: $2,500,000.
        c. Mitigation: We support all efforts to meet this obligation of
    the project. Existing funds must be carried forth to continue land
    purchase actions.
        d. Request the Corps cost share in the design and construction of
    boat launch facilities in Pool 3; one at Hampton's Lake Recreation site
    and one at Colfax, LA. There is limited access to the Red River in Pool
    3 and as commercial traffic increases it is imperative that there be
    access for safety. Two important municipal riverfront projects are the
    Teague Parkway Trails in Bossier City and Shreveport riverfront
    development. These sites will be cost shared 50/50 with the Red River
    Waterway Commission who has their funds on hand to participate.

    Total Funds Requested...................................      $3,000,000
    Fiscal year 2000 Federal Share..........................       1,500,000
    Local Sponsor Share.....................................       1,500,000

        e. Following is the total Federal requirement for the Red River
    Waterway Project (a thru d above):

    President's Budget......................................     $21,113,000
    Navigation Construction Adds............................       2,500,000
    Public Recreation Sites.................................       1,500,000
    Mitigation..............................................................
                        --------------------------------------------------------
                        ____________________________________________________
          Total Requested for fiscal year 2000..............      25,113,000

        5. Red River Chloride Control Project:
        a. In October 1998 the Assistant Secretary of the Army (Civil
    Works) agreed to support a thorough re-evaluation of the Wichita River
    Basin features. Three out of four options have a positive benefit to
    cost ratio. He reprogrammed funds so that work could continue in fiscal
    year 1999. We are disappointed there were no funds in the President's
    budget.
        b. Many of the features in the Wichita River basin have been
    constructed and completion of this system would reclaim Lake Kemp which
    would become a major water source for the region.
        c. It is extremely important that the ongoing water quality and
    environmental monitoring continue. This is critical to establishing a
    baseline in which to evaluate the effects of the project. Fiscal year
    2000 Funds Requested: $2,100,000.
        6. Red River Below Denison Dam, Arkansas Levees: Continue funding
    levels to fully fund construction and restoration of Levee Item #5
    (Miller County Levee District) and Levee Item #9A (Red River Levee
    District in Lafayette County). This completes all Miller County Levees
    and starts the Lafayette County Levees. Funds are to ``remain available
    until expended''. Fiscal year 2000 Funds Requested: $5,000,000.
        7. Bowie County Levee, TX: The plans and specifications have been
    completed. We request construction funding for the `locally preferred'
    option under the cost sharing requirements of the Flood Control Act of
    1946 not withstanding economic evaluation. Assurances of support and
    maintenance have been obtained from the local sponsor. Fiscal year 2000
    Funds Requested: $200,000.
        8. Red River Emergency; Bank Protection; AR & LA: Fully fund
    construction on Black Lake Phase II ($2.0 mil), Hunters Island
    Revetment ($7.1 mil), Pleasant Valley Revetment ($4.9 mil) and design
    Bois D'Arc Revetment. These are the most critical sites that require
    reinforcements as soon as possible. Funds requested include
    engineering, design and construction management and are to `remain
    available until expended'. Fiscal year 2000 Funds Requested:
    $17,000,000.
        9. Red River Waterway, Index, Arkansas to Denison Dam, Texas (Bank
    Stabilization): We request the following items be funded at full
    federal expense.
        a. Phase II of the Sediment Transport Study will cost $275,000.
    This will determine the quantity and types of sediments entering the
    Red River, along Texas and Oklahoma, that are being deposited in the
    Red River Waterway navigation channel and creating dredging costs.
        b. To initiate construction and a monitoring program for a Bendway
    Weir `demonstration project' located at US Highway 271 bridge between
    Hugo, Oklahoma and Paris, Texas. Fiscal year 2000 Funds Requested for a
    and b: $5,800,000.
        10. Aloha-Rigolette Project, LA: Construction is underway and the
    funding should continue at full Corps capability to complete the
    project in fiscal year 2000.

    President's Budget......................................        $581,000
    To Complete the Project.................................         519,000
                        --------------------------------------------------------
                        ____________________________________________________
        Total Requested for fiscal year 2000................       1,100,000

        11. McKinney Bayou, AR: The reconnaissance study was completed and
    determined to be economically feasible. This project will go directly
    into PED and cost shared with the local sponsor (Federal--75 percent;
    local sponsor 25 percent) over a three year period; as soon as the
    local sponsor commits to the cost share requirement.
        12. Ogden Levee, Little River County, AR: This levee was authorized
    to be incorporated into the Federal Levee System by the Flood Control
    Act of 1946. The levee is in need of rehabilitation and has yet to be
    incorporated into the Federal Levee System. A reconnaissance report
    completed in November 1991 found that flood control levees along the
    Red River in Little River County were justified and not environmentally
    objectional. The Secretary of the Army acting through the Chief of
    Engineers is directed to perform preconstruction engineering and design
    (PED) for the Ogden Levee. PED costs shall be initially 100 percent
    Federally funded and shared in the same percentage as the project
    purposes. The Ogden Levee is to be designed to the same specifications
    as the opposite bank levees in Bowie and Miller Counties. A sponsor has
    been identified and provided a letter of intent.

    Total PED Funds Requested...............................        $400,000
    Fiscal year 2000 Funds Requested........................         340,000

        13. Bossier Levee System, LA: Direct the Corps to clear and snag
    the channel of Loggy Bayou from its confluence of the Red River for 7.8
    miles. This channel has a serious impact on flooding in the upstream
    reaches which includes the southern parts of Bossier City. Fiscal year
    2000 Funds Requested: $500,000.
    C. Operation and Maintenance
        14. Red River Waterway, O&M:
        a.The President's budget included $8,781,000 for the O&M of this
    project which falls short of capability and needs. Maintaining existing
    navigation structures is crucial to the safety of this new waterway. As
    experienced in 1998 failure to spend $500,000 to maintain the Dismall
    Swamp Revetment, when the problem was first identified, resulted in a
    catastrophic failure of the revetment and adjacent levee which cost
    $5,000,000 in emergency repairs.
        b. WRDA 96 authorized the Corps to insure the oxbows remain
    accessible to the Red River for environmental purposes. The O&M funding
    level must be adequate to address this issue each year.
        c. Currently there appears to be a failure in the Cupples Landing
    Revetment, at the center of the Port of Shreveport-Bossier complex.
    Continued erosion of this revetment will threaten existing port
    structures. The Corps must be directed to investigate this and repair
    the revetment at full federal expense.
        d. Approximately 90 dikes and revetments are in need of repair in
    order to maintain the integrity and safety of the channel. We request
    funds for the Corps expressed capability of $2.5 million to repair
    Cupples and Grand Bend revetments; however, the priority of revetments
    can change due to changing river conditions.
        e. We request the Corps expressed capability of $2.8 million to
    complete the backlog of maintenance at the five locks and dams. If not
    funded this maintenance will cost more in the future or become an
    emergency, shutting down the Waterway.

    Fiscal year 2000 President's Budget.....................      $8,781,000
    Revetment Repair........................................       2,500,000
    L&D Backlog Maintenance.................................       2,800,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total fiscal year 2000 O&M Funds Requested........      14,081,000

        15. Operations & Maintenance at Corps Projects: Request that all
    O&M funded projects be funded at the level of `expressed Corps
    capability'. A serious backlog of maintenance will create more
    expensive problems in the future.
                        backup information for requests
        Following is backup information and a historical perspective on
    each project request. They are numbered to correspond to each numbered
    project in the Summary of Request, Section III.
    1. NAVIGATION ON THE RED RIVER IN SOUTHWEST ARKANSAS
        Twenty-one years ago the Arkansas General Assembly created the Red
    River Commission upon the recommendation of Governor Dale Bumpers, now
    the Senior United States Senator for the State of Arkansas. The
    Commission was vested with the authority to furnish the local
    cooperation necessary for the construction and study of projects and to
    coordinate with the Corps of Engineers and the Congress to develop the
    water resources of the Red River in Arkansas. With navigation now a
    reality to Shreveport, Louisiana, we are prepared to extend water
    transportation into Arkansas. Southwest Arkansas and East Texas are
    economic depressed regions. This project would provide multi-purpose
    opportunities for industries and increased employment. A regional
    impact study recently completed clearly demonstrates the benefits this
    project would have in the region. The local sponsor, Red River
    Commission of Arkansas, initiated and fully funded this Regional
    Economic Impact Study which showed benefits greater than 2.0 to 1.
        There is no doubt that this project is feasible and only a full
    feasibility study will prove that. Most importantly, the local cost
    share, 50 percent, is available now for this study. The feasibility
    study was funded in fiscal year 1998 and fiscal year 1999 with
    reprogrammed funds from another Red River Study. It is imperative to
    continue that funding.
    2. NO ADDITIONAL INFORMATION
    3. NO ADDITIONAL INFORMATION
    4. RED RIVER WATERWAY PROJECT; NAVIGATION TO SHREVEPORT-BOSSIER CITY
        The Red River Valley Association and Louisiana delegation are
    appreciative for the completion of Locks and Dams 4 and 5. Navigation
    to Shreveport-Bossier City has significantly boosted the economy
    throughout the river basin.
        There is still work ahead of us to maintain and develop the
    navigation channel. It is also imperative that funds be appropriated to
    continue construction on navigation structures for this waterway to
    insure reliable, safe commercial navigation. This project is NOT
    complete, $200 million, remains to be constructed. The Red River Valley
    Association encourages and supports the continuation of the mitigation
    commitment for the whole project. These are important environmental
    projects for the overall system of the Red River.
        Recognizing that recreation is an integral component of the Red
    River Waterway Project, the Red River Valley Association supports the
    development of recreational facilities as a part of the overall project
    construction. The Master Plan for Recreation has been submitted to the
    Mississippi Valley Division for final review and approval. We support
    approval of this re-evaluation and funding to construct the recommended
    sites.
    5. RED RIVER BASIN CHLORIDE CONTROL PROJECT
        Natural mineral pollutants in the upper reaches of the Red River
    Basin are rendering downstream waters unusable for most purposes. The
    primary pollutants are chlorides and sulfates.
        The U.S. Public Health Service initiated a study in 1957 to locate
    the natural pollution areas and determine the contribution of
    pollutants from the individual areas to the Red River. It was
    determined that 10 natural salt source areas located in the basin
    contribute a daily average of about 3,600 tons of salt (as NaC1) to the
    Red River. The U.S. Army Corps of Engineers, Tulsa District, entered
    the study in 1959 to recommend measures to control the natural
    pollution. Structural measures were recommended for 8 of the 10 salt
    source areas.
        An experimental project at Area V near Estelline, Texas was
    authorized by the Flood Control Act of 1962. The project consists of a
    9-foot-high by 340 foot diameter earthen dike encompassing a brine
    spring and a 4-foot-wide concrete outlet flume with stoplogs to control
    flow. With the project in operation since January 1964, surface flow
    from the spring has been suppressed, thus preventing over 240 tons of
    chlorides per day from entering Prairie Dog Town Fork of the Red River.
        Structural measures for chloride control at Areas VII, VIII, and X
    in the Wichita River Basin above Lake Kemp were authorized by the Flood
    Control Act of 1966 (PL 89-789), and structural measures for Areas VI,
    IX, XIII, and XIV were authorized by the Flood Control Act of 1970 (PL
    91-611). Actual construction, however, was not to be initiated until
    approved by the Secretary of the Army and the President. The Flood
    Control Act of 1970 was amended by the Water Resources Development Act
    of 1976 to eliminate the required approval of the President to initiate
    construction.
        The Water Resources Development Act of 1974 (PL 93-251),
    specifically authorized construction of chloride control measures at
    Area VIII, located on the South Fork of the Wichita River in King and
    Knox Counties, Texas. The project includes a low-flow dam with a
    deflatable weir to collect brine flows emitting from the area, Truscott
    Brine Reservoir, located near Truscott, Texas, for brine storage, and a
    pump station and pipeline to deliver the brine to the impoundment.
    Construction began in the fall of 1976 and the project was placed in
    operation in May 1987. Area VIII continues to exceed design
    specifications and currently controls over 168 tons of chlorides daily.
        The Water Resources Development Act of 1986 (PL 99-662) required
    that a special panel evaluate the improvement in water quality
    downstream of Area VIII to determine its consistency with the water
    quality assumed in the development of project benefits. A favorable
    report was submitted to the Assistance Secretary of the Army (Civil
    Works) and the Committee on Environment and Public Works of the Senate
    and the Committee on Public Works and Transportation of the House of
    Representatives in August of 1988. PL 99-662 authorizes 100 percent
    federal funding and construction of the remaining control features
    contingent upon the favorable evaluation of the panel.
        Congress appropriated $5 million in fiscal year 1991, $3 million in
    fiscal year 1992, $6 million in fiscal year 1993, $4 million in fiscal
    year 1994 and $16 million in fiscal year 1995 which was in the
    President's Budget for the first time ever. These funds were to
    continue design and construction of Areas VI, VII, IX and X and the
    Crowell Brine Reservoir. Construction of part of the brine collection
    facilities (pump station and low flow dam) at Area X was initiated in
    September 1991 and is complete. Accelerated design of the remaining
    chloride control features was approved in fiscal year 1994 to permit
    construction as additional funds become available.
        Real estate acquisition for Area VI, VII, IX, and the Crowell Brine
    Reservoir was scheduled to begin in fiscal year 1993, but was postponed
    pending the outcome of the economic re-evaluation report ordered by the
    Assistant Secretary of the Army for Civil Works which was subsequently
    approved in November 1993 and further instructed the Corps of Engineers
    to complete all remaining areas of the project.
        As part of the process to complete a Supplemental Environmental
    Impact Statement (SEIS) USFWS objected to the project in August 1994.
    This was unexpected by the Corps of Engineers since they had been
    coordinating with USFWS since 1991 and there was no indication they
    would deliver a negative opinion. This has stopped all construction
    work and effectively delayed the project.
        The SFEIS was completed in August 1996; however, Dr. Zirschky,
    Acting ASA(CW), directed that a Supplement Assessment Report (SAR) be
    completed by February 1997. The ASA(CW) in November 1997, directed the
    Corps to proceed with the Wichita River Basin features of the project.
    In October 1998, Dr. Westphal, ASA (CW), reprogrammed funds and
    continued support for the Wichita River. Continued funding is needed to
    maintain the environmental monitoring program in place and to initiate
    work on the Wichita River portion of this project.
    6. RED RIVER BELOW DENISON DAM, ARKANSAS LEVEES
        The facilities constructed under this authorization are the first
    lines of flood protection for the Red River Valley and its citizens.
    Accelerated and new caving of the river banks of the Red River continue
    to endanger existing flood control structures and levees as well as
    valuable agricultural lands, highways, railroads, utilities, home and
    other valuable resources and improvements within the Red River Valley.
        Following the disastrous flood of May 1990, there can be no doubt
    of the importance of properly maintained levees. All areas not
    protected by properly maintained levees were flooded and the only
    protection from enormous bank caving was where revetment projects had
    been constructed by the Corps.
        The Red River Levees Below Denison Dam Project is the only
    comprehensive flood control program on the Red River containing
    authorization for construction of a variety of flood control measures,
    levees and other flood control works. Some of the projects planned in
    the original authorization project have not been completed and these
    must be constructed in order for the citizens of the Red River to
    derive necessary flood protection. Only minimal funds have been
    appropriated by Congress for the Red River Levees in recent years.
        Another example of flood control work needed is levee
    rehabilitation along the main stem of the Red River in the state of
    Arkansas. Many of these levee sections were severely tested by the May
    1990 flood, and it is apparent that rehabilitation is needed to
    increase their integrity, substantially reduce maintenance costs, and
    provide additional structural strength at appropriate elevations needed
    to protect citizens, agricultural land and transportation systems. The
    Corps has completed an engineering study of the Levees on the Red River
    from Index, AR to the Louisiana State Line to establish and prioritize
    levee locations that have deficient grades, slopes and crown. This
    report included the recommendations with construction costs for all
    identified area. The first item of construction on the Miller County
    Levee System was completed in 1995 and three more items will be
    completed by the end of fiscal year 1998.
        It is imperative that Red River Levees continue as authorized by
    Congress and that adequate funding be appropriated to accomplish the
    construction of this needed protection. There are eleven construction
    items to be constructed with four completed to date.
    7. BOWIE COUNTY LEVEE, TX
        Major flooding along the Red River in May 1990 severely tested the
    integrity of the Bowie County Levee located along the right bank of the
    Red River north of Texarkana, Texas. Had it not been for emergency
    measures taken by the U.S. Army Corps of Engineers and local interests,
    the levee would have been destroyed during the flood. It is the opinion
    of the Corps that the levee would fail if subjected to another flood of
    the magnitude encountered in May 1990. Replacement or restoration of
    the levee is necessary to protect approximately 7,000 acres of prime
    agricultural land as well as residential and farm structures.
        Additionally, this levee system protects the land side of the
    Miller County levees in Arkansas. The Arkansas levees are being
    rehabilitated at full federal expense; therefore, a case has been made
    that the Bowie County levee should be funded the same as Arkansas
    levees. Again, the Arkansas levees would not be of any value should the
    Bowie County levee fail.
        In fiscal year 1997 Congress directed the Corps to complete designs
    and specifications for two options; federally preferred and locally
    preferred options. It is our intention to have a fully funded federal
    project for the locally preferred option in accordance with cost
    sharing guidelines in the Flood Control Act of 1946.
    8. RED RIVER EMERGENCY BANK PROTECTION; AR & LA
        Although Federal projects have been authorized for flood control
    and navigation, many active caving banks cannot be stabilized because
    they are not yet sufficiently advanced or not included in earlier
    authorizations. The result is continuing, rampant destruction of
    valuable lands, threatening vital flood control facilities and
    endangering high-cost improvements such as bridges, pipelines,
    highways, railroads, utilities, cities and towns.
        It is urgent that adequate funding under the authority ``Emergency
    Bank Protection'' be continued to construct bank stabilization work as
    early as possible in the most critical locations instead of waiting
    several more years and experiencing the loss of land and economic
    benefits due to damages. Further, continued neglect of these caving
    banks will substantially worsen alignment of the River, making future
    navigation realignment and stabilization much more costly and
    difficult. Many caving banks have an existing alignment that is usable
    for the navigation channel and should be preserved now.
    9. RED RIVER WATERWAY; INDEX, ARKANSAS TO DENISON DAM
        Widely fluctuating stages and high flows during the past several
    years have caused sharp increases in bank caving along the Red River
    from Index, AR to Denison Dam. This accelerated bank caving has caused
    the loss of valuable, vital improvements and non-replaceable prime
    agricultural lands. Flood control structures and levees which protect
    the Valley from disastrous floods are also endangered. These disastrous
    losses can be stopped by a systematic program of bank stabilization.
    Progressive construction of such a program is absolutely essential to
    the safety growth and well-being of the Red River Valley. To further
    delay this vitally needed protection would be short-sighted.
        In view of the fact that construction of bank stabilization is so
    important to the citizens along the Red River boundary of Oklahoma and
    Texas we strongly recommend allowing the Corps of Engineers to proceed
    with a ``demonstration project.'' There are new techniques which we
    believe are less expensive with better results than the traditional
    methods. One new technique is the underwater bendway weir. This
    demonstration project will be evaluated along with the ongoing
    `sediment transport' study to determine the potential for a large scale
    bank stabilization project.
        A `sediment transport study' completed in 1998 demonstrated that
    1.6 million tons of sand sediments from this stretch of river are
    entering the navigation channel in Louisiana. A second phase of this
    study is required to determine what benefits can be realized from
    reduced dredging costs as well as the quantities of clay, silt and
    sand, NOT considered, in the completed study.
        Funds were appropriated in fiscal year 1999 to complete the design
    of the demonstration project. It is critical to continue this funding
    to construct and monitor the project as well as to continue with the
    `sediment transport study'.
    10. ALOHA-RIGOLETTE PROJECT
        This project, initially authorized in 1941 and constructed during
    the 1948-54 period, provides for the protection during high stages of
    the Red River of some 58,000 acres of alluvial land. Drainage from
    340,000 acres that must flow through protected areas during lower river
    stages is disposed of by gravity flow through two 10 foot by 10 foot
    gated concrete drainage structures in the levee at the lower end of the
    project. This protected area has continued to develop agriculturally
    since construction of the project and now additional gates are needed
    to allow adequate gravity drainage during low river stages. As a
    result, local interests requested that additional studies be made of
    the project, paying particular attention to the adequacy of the flood
    gate which has now been determined to be significantly inadequate for
    current conditions.
        A feasibility study was completed by the New Orleans District,
    Corps of Engineers in June 1989. The Red River Valley Association urges
    that Congress appropriate the full capability of the Corps fiscal year
    2000 budget to complete construction activities for the project on the
    Bayou Darrow flood gate, clearing and snagging of channels, the low
    flow structure and mitigation.
    11. McKINNEY BAYOU PROJECT, AR
        The Corps of Engineers completed a reconnaissance study of drainage
    in Miller County, Arkansas. The project is known as the McKinney Bayou
    Project as it is the principal drainage ditch in the County. Due to the
    thousand of acres of land cleared in Miller County during the past 25
    years, the ditch is grossly inadequate to handle the drainage after
    heavy rains. The Reconnaissance study had a high B/C ratio and
    therefore was recommended to go directly to Planning, engineering and
    design (PED). A local sponsor has been identified to cost share PED;
    Federal 75 percent/local sponsor 25 percent.
    12. NO ADDITIONAL INFORMATION
    13. BOSSIER LEVEE DISTRICT, BOSSIER PARISH, LA
        There ia a drainage channel issue which should be the
    responsibility of the Corps of Engineers to maintain. This is Loggy
    Bayou with its confluence on the Red River, river mile 194.1, with the
    channel in question extending approximately 8 miles upstream into Loggy
    Bayou.
        Loggy Bayou is the final and only channel that drains a vast area
    of Northwest Louisiana and part of Arkansas water into the Red River.
    The headwaters start in Columbia County, Arkansas and the drainage area
    includes large parts of Webster, Beinville and Bossier Parishes in
    Louisiana. There are no other diversions for these waters to the Red
    River except through Loggy Bayou.
        In 1943 the Bossier Levee District agreed to maintain the last 7.8
    miles of Loggy Bayou before it enters the Red River. Conditions have
    changed drastically since 1943, to include: the diversion of Coushatta
    Bayou into the Loggy Bayou; the channel is now approximately 20 feet
    deeper due to increased drainage flows and the Red River Waterway
    Project has pooled the water into this section of Loggy Bayou
    permanently raising the water level. The Bossier Levee District does
    not have the equipment, expertise or funding to keep the channel
    maintained so there is now a real threat for increased flooding
    upstream. Since there have been considerable changes to the Loggy Bayou
    Watershed, beyond the control of the Bossier Levee District, and the
    waters drained are multi-state it is requested that the Corps of
    Engineers be directed to maintain the channel in Loggy Bayou, under the
    `Red River Waterway Project', Operations and Maintenance, from its
    confluence with the Red River upstream for approximately 8 miles.
    14. NO ADDITIONAL INFORMATION
    15. NO ADDITIONAL INFORMATION
           support statement: greater shreveport chamber of commerce
                             transportation--water
               red river waterway project fiscal year 2000 budget
        ISSUE: The Locks and Dams for the Red River Waterway Project have
    been completed from the Mississippi River to Shreveport/Bossier City,
    Louisiana. It is important to know that the project is only 90 percent
    complete with $200 million required in construction appropriations. In
    addition, it will take approximately $14 million per year to operate
    and maintain the system.
        WHY IMPORTANT: For economic development to be fully realized, we
    must operate the Red River in a reliable manner for industry to use it
    as a major transportation system. The navigation channel must be
    maintained at a 9-foot draft for efficient use. If the channel is not
    properly maintained, industry will be reluctant to use the Red River
    since they would not be able to load barges to full capacity making
    other modes of transportation competitive.
        The project Recreational Master Plan has been completed and it is
    important to execute the plan as soon as possible. There is limited
    access to the Red River and these sites are necessary for safety as
    well as the economic benefits of recreation.
        OUR POSITION: We appreciate the allocation in the President's
    fiscal year 2000 budget for $21 million in construction funds, which is
    much higher than was in the budget last year. However, this falls short
    of what we require and includes no funding for recreation. An
    additional $4.5 million is needed for navigation and recreation
    projects. Our total request for Red River Waterway construction is
    $25.5 million.
        Maintaining the infrastructure of this Waterway is extremely
    important. Funding maintenance items sooner always costs less than
    waiting until it becomes an emergency. The President's budget allocated
    $8.8 million while a total of $14 million is required to complete all
    regularly scheduled and backlog items. This includes the five locks and
    dams and repair to dikes and revetments.
                    red river basin chloride control project
        ISSUE: The first comprehensive study of the water quality of the
    Red River basin was initiated in 1957 by the U.S. Public Health Service
    under the authorization of the Federal Water Pollution Control Act. It
    was determined that ten natural salt source areas contribute a daily
    average of 3,600 tons of salt per day to the river. This renders
    downstream waters unusable for most purposes. Structural measures to
    help control the chloride pollution at 8 of the 10 sites were developed
    by the Tulsa District, Corps of Engineers. These plans led to
    Congressional authorization in the Flood Control Acts of 1962, 1966 and
    1970. The first structure was completed in January 1964 and the second
    in May 1987. The Water Resources Development Act of 1986 authorized the
    construction of the remaining sites.
        Approximately one-third of the project cost has been expended. The
    total project is expected to cost $303 million.
        The Assistant Secretary of the Army (Civil Works), ASA(CW), Dr.
    Westphal, directed the Tulsa District to conduct a re-evaluation report
    for the Wichita River Basin portion of the project. This is to be
    completed in 1999.
        WHY IMPORTANT: Natural mineral pollutants (primarily chlorides and
    sulfates) in the upper reaches of the Red River Basin are rendering
    downstream waters unusable for most purposes; therefore, the Red River
    Chloride Project is imperative in order to realize full utilization of
    the surface water supplies in Louisiana (as well as Texas, Oklahoma and
    Arkansas). More than 1,000 miles of streams in the river system are
    severely contaminated by naturally occurring brine and is not suitable
    for municipal, industrial or agricultural purposes.
        OUR POSITION: The President did not fund this project in the fiscal
    year 2000 budget, even thought it is supported by the ASA (CW). It is
    imperative that $2.1 million be appropriated so that the re-evaluation
    of the Wichita River can be completed and the next phase of
    construction start in fiscal year 2001. These funds also include the
    environmental monitoring program currently underway to collect valuable
    data on the ecosystem of this region.
                                     ______

    Prepared Statement of the Caddo/Bossier Port Commission, Shreveport, LA

        On behalf of the citizens of Northwest Louisiana, the Caddo-Bossier
    Parishes Port Commission strongly urges the Congress of the United
    States to allocate in fiscal year 2000 the necessary monies to ensure
    safe and reliable inland waterway, and in particular Red River,
    navigation and to carefully consider the numerous new taxes and user
    fees proposed impacting the nation's ports.
        Port's are a vital element of the national economy and national
    security and federal commitment to provide reliable and secure funding
    for our port system is paramount. Yet the waterways are facing once
    again proposals for reduced funding, new user fees and the constant
    call of the ``Green Scissors'' campaign to cut maritime programs to
    pieces.
        The President's budget request appears to shortchange inland
    navigation and flood control while other civil works programs are
    fully-funded. For example, construction and maintenance of projects
    along the nation's inland waterways would be funded at less than half
    the level needed to optimize project schedules while deep draft harbor
    maintenance and construction would be funded at an optimal level. The
    optimal spending would be funded, however, by a new Harbor Services
    User Fee (HSUF), a hastily crafted proposal which leaves open troubling
    and unanswered questions and unfairly places the entire financial
    burden on certain commercial vessel operators. Instead of making
    America's trade gateways safer or more efficient, the HSUF would make
    them more costly and less competitive.
        The Port of Shreveport-Bossier, regularly operating now for two
    years, is a part of this national infrastructure. Maintaining the
    international competitive position of this country's ports is necessary
    in order for the inland ports to operate as much of the cargo carried
    on inland waterways travels through the deepdraft ports.
        The Port of Shreveport-Bossier stands today as a longtime dream
    with a potential proving to exceed even the most optimistic
    projections. With local taxpayer investment guaranteed by a 1993
    property tax in the two parishes of Bossier and Caddo, the Port's
    infrastructure is growing to meet the demands of a rapidly expanding
    customer base. Public investment in the Port complex today stands at
    more than $73,000,000. Businesses located at the complex are Arch
    Chemicals, Oakley Louisiana, Re-Claim Environmental, Red River
    Terminals and Shreveport Fabricators.
                                     ______

    Prepared Statement of the Red River Waterway Commission, Natchitoches,
                                       LA

        On behalf of the citizens of the Red River Waterway District of
    Louisiana, the Red River Waterway Commission strongly urges the
    Congress of the United States to allocate the funds necessary for
    fiscal year 2000 for Red River Waterway Project. Adequate funding will
    allow continued construction progress toward actual project completion
    and will facilitate totally reliability in operations for continued
    industrial and recreational development. The infrastructure investment
    of $1.8 billion can only be justified if commercial and recreational
    development interests can rely on an efficient, functional and user
    friendly river system.
        Construction on Red River is approximately 90 percent complete,
    however, it is vitally important that we understand the importance of
    steady progress toward project completion with full knowledge of the
    financial constraints this country, the President and the Congress are
    wrestling with during the budget process.
                areas of need for the red river waterway project
        Navigation Structures (Revetments and Dikes).--These structures are
    necessary to maintain the channel alignment so as to provide reliable
    navigation to the users. In addition, the structures help insure that
    barges can be loaded to the maximum depths allowable for profitable
    operation.
        Recreation Development.--Design and Construction in Pools 3, 4 and
    5 should begin immediately. Important projects such as Shreveport
    Riverfront, Teague Parkway Trails, Colfax and Hampton Lake establish an
    excellent recreation foundation.
        Operations & Maintenance Program.--Channel Maintenance (Dredging)
    is critical to the viability of the waterway system. The Corps of
    Engineers needs sufficient resources to adequately maintain the
    navigation channel to provide dependable and reliable depths so that
    barges moving on the system can be loaded to the maximum nine foot
    draft. Reliable conditions will encourage other development on the Red
    River. Maintenance of existing navigation structures at strategic
    locations is vital to the users. The backlog of maintenance items at
    the lock & dam structures could be devastating to the nation's
    investment in the navigation system.
        Construction/Maintenance Program.--The Corps of Engineers needs
    resources available to react quickly to landowner bank caving
    complaints that are a result of the project and are fully justified.
        Aids to Navigation.--As commercial use continues to increase, the
    Coast Guard presence and resources must reflect a similar growth to
    adequately maintain the buoy system on the Red River and stimulate
    confidence in the river system.
        Mitigation and Bendway Dredging.--Continue with land acquisition
    and developmental cost analysis associated with the mitigation portion
    of the project and as soon as practical begin the bendway dredging
    operations to reestablish the connection to the channel of Red River.
                                     ______

                MIDWEST U.S. WATER RESOURCE DEVELOPMENT PROJECTS

      Prepared Statement of Terrence J. O'Brien, President, Metropolitan
                 Water Reclamation District of Greater Chicago
        On behalf of the Metropolitan Water Reclamation District of Greater
    Chicago (District), I want to thank the Subcommittee for this
    opportunity to present our priorities for fiscal year 2000 and, at the
    same time, express our appreciation for your support of the District's
    projects in the years past. The District is the local sponsor for three
    Corps of Engineers priority projects of the Chicagoland Underflow Plan:
    the O'Hare, McCook and Thornton Reservoirs. We are requesting the
    Subcommittee's full support for McCook and Thornton Reservoirs, as the
    O'Hare Reservoir has recently been completed. Specifically, we request
    the Subcommittee to include a total of $6,000,000 in construction
    funding for the McCook and Thornton Reservoir projects in the bill. The
    following text outlines these projects and the need for the requested
    funding. Also, attached is a booklet indicating the municipalities in
    our area, which benefit from these projects and the need for the
    requested funding. The booklet reviews the history of the issues
    involved, including newspaper articles and pertinent data from the U.S.
    Army Corps of Engineers (Corps) and the Illinois State Water Survey.
                         the chicagoland underflow plan
        The Chicagoland Underflow Plan (CUP) consists of three reservoirs:
    the O'Hare, McCook, and Thornton Reservoirs. The O'Hare Reservoir
    Project was fully authorized for construction in the Water Resources
    Development Act of 1986 (Public Law 99-662) and completed by the Corps
    in fiscal year 1999. This reservoir is connected to the existing O'Hare
    segment of the District's Tunnel and Reservoir Plan (TARP). Adopted in
    1972, TARP was the result of a multi-agency effort, which included
    officials of the State of Illinois, County of Cook, City of Chicago,
    and the District.
        TARP was designed to address the overwhelming water pollution and
    flooding problems of the Chicagoland combined sewer areas. These
    problems stem from the fact that the capacity of the area's waterways
    has been overburdened over the years and has become woefully inadequate
    in both hydraulic and assimilative capacities. These waterways are no
    longer able to carry away the combined sewer overflow discharges nor
    are they able to assimilate the pollution associated with these
    discharges. Severe basement flooding and polluted waterways (including
    Lake Michigan, which is the source of drinking water for millions of
    people) is the inevitable result. We point with pride to the fact that
    TARP was found to be the most cost-effective and socially and
    environmentally acceptable way for reducing these flooding and water
    pollution problems. Experience to date has reinforced such findings
    with respect to economics and efficiency.
        The TARP plan calls for the construction of the new ``underground
    rivers'' beneath the area's waterways. The ``underground rivers'' would
    be tunnels up to 35 feet in diameter and 350 feet below the surface. To
    provide an outlet for these tunnels, reservoirs will be constructed at
    the end of the tunnel system. Approximately 93.4 miles of tunnels have
    been constructed or are under construction at a total cost of $2.1
    billion and are operational. The tunnels capture the majority of the
    pollution load by capturing all of the small storms and the first flush
    of the large storms. Another 15.8 miles of tunnels costing $399 million
    need to be completed. The tunnels connected to the O'Hare Reservoir now
    discharge when they fill up during large rainstorms into the Reservoir
    and this system is working well and providing benefits. Thornton and
    McCook Reservoirs have not been built yet, so significant areas remain
    unprotected. Without these outlets, the local drainage has nowhere to
    go when large storms hit the area. Therefore, the combined stormwater
    and sewage backs up into over 470,000 homes. This is a reduction from
    the 550,000 homes impacted before the tunnels were put on line.
        Since its inception, TARP has not only abated flooding and
    pollution in the Chicagoland area, but has helped to preserve the
    integrity of Lake Michigan. In the years prior to TARP, a major storm
    in the area would cause local sewers and interceptors to surcharge
    resulting in CSO spills into the Chicagoland waterways. Since these
    waterways have a limited capacity, major storms have caused them to
    reach dangerously high levels resulting in massive sewer backups into
    basements and causing multi-million dollar damage to property. To
    relieve the high levels in the waterways during major storms, the gates
    at Wilmette, O'Brien, and the Chicago River would be opened and the
    CSOs would be allowed to backflow into Lake Michigan.
        Since the implementation of TARP, some backflows to Lake Michigan
    have been eliminated. Since implementation of TARP, 358 billion gallons
    of CSOs have been captured by TARP, that otherwise would have reached
    waterways. After the completion of both phases of TARP, 99 percent of
    the CSO pollution will be eliminated. The elimination of CSOs will
    result in less water needed for flushing of Chicago's waterway system,
    making it available as drinking water to communities in Cook, DuPage,
    Lake, and Will counties, which have been on a waiting list.
    Specifically, since 1977, these counties received an increase of 162
    mgd, partially as a result of the reduction in the District's
    discretionary diversion in 1980. Additional allotments of Lake Michigan
    water, beyond 1991, will be made to these communities, as more water
    becomes available from sources like direct diversion.
        With new allocations of lake water, communities that previously did
    not get to share lake water are in the process of building, or have
    already built, water mains to accommodate their new source of drinking
    water. The new source of drinking water will be a substitute for the
    poorer quality well water previously used by these communities. Partly
    due to TARP, it is estimated by IDOT that between 1981 and 2020, 283
    mgd (439 cfs) of Lake Michigan water would be added to domestic
    consumption. This translates into approximately 2 million people that
    previously did not receive lake water, would be able to enjoy it. This
    new source of water supply will not only benefit its immediate
    receivers but will also result in an economic stimulus to the entire
    Chicagoland area, by providing a reliable source of good quality water
    supply.
        the mc cook and thornton reservoirs--chicagoland underflow plan
        The McCook and Thornton Reservoirs of the Chicagoland Underflow
    Plan (CUP) were fully authorized for construction in the Water
    Resources Development Act of 1988 (Public Law 100-676). The CUP, as
    previously discussed, is a flood protection plan that is designed to
    reduce basement and street flooding due to combined sewer back-ups and
    inadequate hydraulic capacity of the urban waterways. These projects
    are the second and third components of CUP, they consist of reservoirs
    to be constructed in west suburban Chicago and Thornton in south
    suburban Chicago.
        These reservoirs will provide a storage capacity of 15.3 billion
    gallons and will produce annual benefits of $104 million. The total
    potential annual benefits of these projects are approximately twice as
    much as their total annual cost. The District, as the local sponsor, is
    actively pursuing land acquisition for these projects, and is prepared
    to meet its cost sharing obligations under Public Law 99-662.
        These projects are a very sound investment with a high rate of
    return. They will enhance the quality of life and the safety and the
    peace of mind of the residents of this region. The State of Illinois
    has endorsed these projects and has urged their implementation. In
    professional circles, these projects are hailed for their
    farsightedness, innovation, and benefits.
        Based on two successive Presidentially-declared flood disasters in
    our area in 1986 and again in 1987 and dramatic flooding in the last
    several years, we believe the probability of this type of flood
    emergency occurring before implementation of the critical flood
    prevention measure is quite high. As the public agency for the greater
    Chicagoland area responsible for water pollution control, and as the
    regional sponsor for flood control, we have an obligation to protect
    the health and safety of our citizens. We are asking your support in
    helping us achieve this necessary and important goal of construction
    completion.
        We have been very pleased that over the years, the Subcommittee has
    seen fit to include critical levels of funds for these important
    projects. We were delighted to see the $3,250,000 in construction funds
    included in the Energy and Water Development Appropriations bill for
    fiscal year 1999. However, it is important that we receive a total of
    $6,000,000 in construction funds in fiscal year 2000 to maintain the
    commitment and accelerate these projects. This funding is critical to
    accelerate the detailed design, plans and specifications and initiate
    construction of the McCook Reservoir. The community has waited long
    enough for protection and we need these funds now to move the project
    into construction. We respectfully request your consideration of our
    request.
                                    summary
        Our most significant recent flooding occurred on February 20, 1997,
    when almost four inches of rain fell on the greater Chicagoland area.
    Due to the frozen ground, almost all of the rainfall entered our
    combined sewers, causing sewerage back-ups throughout the area. When
    the existing TARP tunnels filled with approximately 1.2 billion gallons
    of sewage and runoff, the only remaining outlets for the sewers were
    our waterways. Between 9:00 p.m. and 3:00 a.m., the Chicago and Calumet
    Rivers rose six feet. For the first time since 1981 we had to open the
    locks at all three of the waterway control points; these include
    Wilmette, downtown Chicago, and Calumet. Approximately 4.2 billion
    gallons of combined sewage and stormwater had to be released directly
    into Lake Michigan.
        Given our large regional jurisdiction and the severity of flooding
    in our area, the Corps was compelled to develop a plan that would
    complete the uniqueness of TARP and be large enough to accommodate the
    area we serve. With a combined sewer area of 375 square miles,
    consisting of the city of Chicago and 51 contiguous suburbs, there are
    550,000 homes within our jurisdiction, which are subject to flooding at
    any time. The annual damages sustained exceed $150 million. If these
    projects were in place, these damages could be eliminated. We must
    consider the safety and peace of mind of the 2 million people who are
    affected as well as the disaster relief funds that will be saved when
    these projects are in place. As the public agency in the greater
    Chicagoland area responsible for water pollution control, and as the
    regional sponsor for flood control, we have an obligation to protect
    the health and safety of our citizens. We are asking your support in
    helping us achieve this necessary and important goal. It is absolutely
    critical that the Corps' work, which has been proceeding for a number
    of years, now proceed into construction.
        Therefore, we urgently request that a total of $6,000,000 in
    construction funds be made available in the fiscal year 2000 Energy and
    Water Development Appropriations Act to advance construction of the
    McCook and Thornton Reservoir Project.
        Again, we thank the Subcommittee for its support of our project
    over the years and we thank you in advance for your consideration of
    our request this year.
                                     ______

      Prepared Statement of the Arkansas River Basin Interstate Committee
        Mr. Chairman and members of this distinguished Committee, my name
    is Wallace Gieringer. I am retired as Executive Director of the Pine
    Bluff-Jefferson County (Arkansas) Port Authority. It is my honor to
    serve as Chairman of the Arkansas River Basin Interstate Committee,
    members of which have been appointed by the governors of the great
    states of Arkansas, Colorado, Kansas, Missouri, and Oklahoma.
        As Chairman, I present this summary testimony as a compilation of
    the most important projects from each of the member states. Each of the
    states unanimously supports these projects without reservation. I
    request that the copies of each state's individual statement be made a
    part of the record, along with this testimony.
        Mr. Chairman, the members of the Interstate Committee have again
    identified as our top priority a project vital to the five-state area
    and beyond--the urgently needed Montgomery Point Lock and Dam at the
    confluence of the McClellan-Kerr Arkansas River Navigation System and
    the Mississippi River.
        Continuing problems caused by sediment and lowering of the
    Mississippi River plague McClellan-Kerr entrance channel users.
    Construction of Montgomery Point must continue as rapidly as possible
    before limited dredge disposal areas become inadequate. During times of
    low water on the Mississippi River the entrance channel is drained of
    navigable water depth. As the Mississippi River bottom continues to
    lower, the McClellan-Kerr moves toward total shutdown.
        Thus, the entire Arkansas River Navigation System is at risk, and
    its long term-viability is threatened without Montgomery Point. Some $5
    billion in federal and private investments, thousands of jobs, growing
    exports in world trade and future economic development are endangered.
        The good news is that you, your associates, the Congress and the
    Administration have all recognized the urgency of constructing
    Montgomery Point!
        The Corps of Engineers awarded a $186 million construction contract
    on July 19, 1997. Last year Congress appropriated $44 million to begin
    construction of the lock and dam. Work is progressing.
        Mr. Chairman and Members of the Committee, continuing Congressional
    support is essential at this crucial time in the history of the
    project. An appropriation of $44 million is needed for fiscal year 2000
    to insure that Montgomery Point is in operation as soon as possible at
    the lowest possible cost.
        The Interstate Committee also respectfully recommends the following
    as important priorities:
        Providing $500,000 for the continuation of the Arkansas River, Fort
    Smith Study. While navigation is the primary purpose of the McClellan-
    Kerr, navigation needs and flood control are closely related. Sustained
    high flows result in difficult navigation conditions and continued
    flooding in the vicinity of Fort Smith, Arkansas. Flood control
    features of the Navigation System in that area are based on the Van
    Buren, Arkansas, gage, thus the flooding concerns and navigation
    problems are interrelated. Accordingly, this study would address the
    Navigation System Operating Plan to improve navigation conditions on
    the river, as well as the performance of flood control measures,
    especially in the Fort Smith reach.
        The Interstate Committee supports funding for the Upper Colorado
    River Endangered Fish Recovery Program. For fiscal year 2000 we request
    $6.25 million for the U.S. Bureau Reclamation (``Upper Co region
    Endangered Species Recovery Programs'') and (Activities), and U.S. Fish
    and Wildlife Service $1.2 million (``Resources Management Funds''),
    ``Section Six Funds'', and ``RWS Budget Base Funds--Fisheries Activity;
    Hatchery O&M, sub-activity, to operate the Endangered Fish Propagation
    Facilities at Ouray National Wildlife Refuge, Utah.''
        The Interstate Committee also requests funding in the amount of
    $500,000 for the continuation of the Equus Beds Groundwater Recharge
    Demonstration Project--a City of Wichita, Groundwater Management
    District No. 2 and State of Kansas project to demonstrate the
    feasibility of recharging a major groundwater resource supplying water
    to 500,000 municipal, industrial and irrigation users and will also
    reduce potential degradation of the existing groundwater quality by
    minimizing migration of saline water.
        Mr. Chairman, we strongly urge the Committee to provide funding in
    the amount of $1.5 million to initiate the installation of tow haulage
    equipment on the McClellan-Kerr Arkansas River Navigation System at
    designated locks in Oklahoma.
        Mr. Chairman, Members of this Committee, we respectfully request
    that you and members of your staff review and respond in a positive way
    to the attached individual statements from each of our states which set
    forth specific requests pertaining to those states.
        We sincerely appreciate your consideration and assistance. Thank
    you very much for the foresight, wisdom and resourcefulness you and
    your colleagues demonstrate each and every year in providing solutions
    to our nation's water resource problems.
                                     ______

      Prepared Statement of Wallace A. Gieringer, Chairman for Arkansas,
                   Arkansas River Basin Interstate Committee
        Mr. Chairman and members of the Committee, thank you for the
    opportunity to present testimony to this most important committee. I am
    retired as Executive Director of the Pine Bluff-Jefferson County Port
    Authority and serve as Arkansas Chairman for the Interstate Committee.
    Other committee members representing Arkansas, in whose behalf this
    statement is made, are Messrs. Wayne Bennett, soybean and rice farmer
    from Lonoke; Colonel Charles D. Maynard, U.S. Army, retired, from
    Little Rock; Barry McKuin, a Director of the Morrilton Port Authority
    at Morrilton; and N. M. ``Buck'' Shell, transportation specialist of
    Fort Smith and Van Buren.
        1998 was a memorable year in the history of the McClellan-Kerr
    Arkansas River Navigation System--and you helped make it so! Last year
    Congress continued to recognize the urgent need for Montgomery Point
    Lock and Dam by appropriating $44 million. This much needed facility is
    under construction near the confluence of the McClellan-Kerr System and
    the Mississippi River. To each of you, your staff and the Congress--our
    most heartfelt thanks!
        The Corps of Engineers awarded a $186 million contract for
    construction of the lock and dam proper on July 19, 1997 and work is
    progressing. When completed, Montgomery Point will protect over $5
    billion in public and private investments, thousands of jobs and world
    trade created as a result of the McClellan-Kerr Arkansas River
    Navigation System. Without Montgomery Point Lock and Dam the future of
    our wonderful navigation system remains threatened. Time is of the
    essence.
        The absence of Montgomery Point Lock and Dam continues to deter
    economic growth along the entire McClellan-Kerr and the project is
    certainly time sensitive! As the Mississippi River bottom continues to
    lower, the McClellan-Kerr moves toward total shutdown. Existing dredge
    disposal areas are virtually full. Ongoing dredging and disposal of
    material can mean environmental damage. Construction must continue as
    rapidly as possible if the project is to be in place before disposal
    areas become inadequate.
        During construction, and use of a temporary by-pass channel,
    navigation hazards will increase making it imperative that work on the
    lock and dam be completed as quickly and as safely as possible.
        We are very grateful that you, your associates, the Congress, and
    the Administration have all recognized the urgency of constructing
    Montgomery Point. Appropriations of $107.3 million have been made to
    date for engineering, site acquisition and construction for this
    project which should be completed in 2003 according to the Corps'
    optimum construction funding schedule.
        Mr. Chairman and Members of the Committee, continuing Congressional
    support is essential at this crucial time in the history of the
    project. We respectfully request and urge the Congress to appropriate
    $44 million for use in fiscal year 2000 to continue construction.
    Adequate funding will insure that the urgently needed facility is in
    operation as soon as possible at the lowest possible cost.
        On another matter, we wish to express thanks, Mr. Chairman, for the
    Committee's support of funding for the Morgan Bendway Environmental
    Restoration Project. The groundbreaking ceremony was held in January in
    Dumas, Arkansas. The state of Arkansas provided one-fourth of the cost
    for this $3.3 million project which includes a 1,000 acre lake and
    wetland restoration measures. This project adds to the many widespread
    public benefits associated with the McClellan-Kerr Arkansas River
    Navigation System.
        Other projects are vital to the environment, social and economic
    well-being of our region and our nation. We recognize the importance of
    continued construction of needed features to the McClellan-Kerr
    Arkansas River Navigation System and strongly recommend that you
    favorably consider the following in your deliberations:
        Provide $500,000 for the Arkansas River, Fort Smith Study. While
    navigation is the primary purpose of the McClellan-Kerr Arkansas River
    Navigation System, navigation needs and flood control are closely
    related. Sustained high flows result in difficult navigation conditions
    and continued flooding in the vicinity of Fort Smith, Arkansas. As the
    operation of the flood control features of the Navigation System in
    that area are based on the Van Buren, Arkansas gage, the flooding
    concerns and navigation problems are interrelated. Accordingly, this
    study would address the Navigation System Operating Plan to improve
    navigation conditions on the river, as well as the performance of flood
    control measures, especially in the Fort Smith reach.
        Support continued funding for the construction, operation and
    maintenance of the McClellan-Kerr Arkansas River Navigation System.
        Continue construction authority for the McClellan-Kerr Arkansas
    River Navigation Project until remaining channel stabilization problems
    identified by the Little Rock District Corps of Engineers have been
    resolved. It is vitally important that the Corps continue engineering
    studies to develop a permanent solution to the threat of cutoffs
    developing in the lower reaches of the navigation system; and for the
    Corps to construct these measures under the existing construction
    authority.
        Provide funding and direct the Corps to complete installation of
    tow haulage equipment for all the locks and dams on the McClellan-Kerr
    Arkansas River Navigation System. This efficiency feature will reduce
    lockage time by as much as 50 percent while permitting tonnage to
    double in each tow with only a minor increase in operating cost.
        Provide funds and direct the Corps of Engineers to begin
    construction of the Arkansas River Levees Project as authorized by
    Section 110 of the Water Resource Development Act of 1990. Continuing
    engineering and design is needed for these levees which have been
    previously studied in the cost-shared Arkansas River Arkansas and
    Oklahoma Feasibility Study.
        $1.0 million needs be specifically provided and the Corps directed
    to begin rehabilitation construction on the Plum Bayou Levee.
        Fund completion of the repair and rehabilitation of the power units
    at the Dardanelle Lock and Dam which first went into operation in 1965.
    After this work is completed, power output will be increased by 13
    percent and thus increase income to the Federal Treasury.
        Funds for repair and rehabilitation of the power units at the
    Ozark-Jeta Taylor Lock and Dam Powerhouse which first went into
    operation in 1970. This project is vitally needed to correct problems
    which have plagued the slant axis turbines since they were first put in
    operation and to continue the reliable production of power from this
    facility.
        We also urge the Congress to continue to encourage the Military
    Traffic Management Command to identify opportunities to accelerate use
    of the nation's navigable waterways to move military cargoes, thereby
    helping contain the nation's defense costs.
        In conclusion, Mr. Chairman, please help prevent a crisis for the
    Arkansas River Navigation System and the multi-state region it serves
    by appropriating $44 million for use in fiscal year 2000 for Montgomery
    Point Lock and Dam.
        The entire Arkansas River Navigation System is at risk, and its
    long-term viability is threatened. The System remains at risk until
    Montgomery Point is constructed. Some $5 billion in federal and private
    investments and thousands of jobs and growing exports are endangered.
        We fully endorse the statement presented to you today by the
    Chairman of the Arkansas River Basin Interstate Committee. We
    appreciate the opportunity to provide testimony to your most important
    subcommittee and urge you to favorably consider our request for needed
    infrastructure investments in the natural and transportation resources
    of our nation.
                                     ______

       Prepared Statement of Steve Arveschoug, District General Manager,
                Southeastern Colorado Water Conservancy District
        Mr. Chairman and Members of the Appropriation Subcommittee on
    Energy and Water Development, thank you for the opportunity to present
    these comments and requests on behalf of Colorado as a participant in
    the Arkansas River Basin Interstate Committee.
        Let me first voice my support for the Interstate Committee's
    priority funding requests for the fiscal year 2000 budget--the
    Montgomery Point Lock and Dam project and the other priority projects
    as listed by the Arkansas River Basin Interstate Committee member
    states.
        Mr. Chairman, Members of the Committee, we respectfully request
    funding for the following: Upper Colorado River Endangered Fish
    Recovery Program--Fiscal Year 2000 Request--United States Bureau of
    Reclamation, $6.25 million (Upper CO Region Endangered Species Recovery
    Programs) and (Activities), and U.S. Fish and Wildlife Service, $1.2
    million (Resources Management Funds, Section Six Funds, and FWS Budget
    Base Funds--Fisheries Activity; Hatchery O&M, sub-activity, to operate
    the Endangered Fish Propagation Facilities at Ouray National Wildlife
    refuge, Utah)
        Reduction of Bureau of Reclamation Overhead Charges: we would like
    to make this Committee aware of what we consider to be excessive
    overhead costs on Safety of Dams projects and project O&M. Bureau
    charges are adding 50 percent to 60 percent to the cost of O&M and
    repair projects. Of that added cost, almost half comes from the
    application of the Bureau's overhead surcharge. Congress should hold
    the Bureau accountable for these costs by requiring the Bureau to study
    less costly alternatives for the delivery of these basic services.
        Mr. Chairman, I would like to give you an example of these
    excessive charges on a project that we are involved with.
        Introduction.--The Southeastern Colorado Water Conservancy District
    is the local public-agency sponsor of the Fryingpan-Arkansas Project.
    The multipurpose Fry-Ark Project annually delivers approximately 70,000
    acre-feet of trans-mountain water to eastern Colorado cities and farms,
    serving a population of 620,000 and irrigating over 200,000 acres.
    Authorized in 1962, the Fry-Ark Project was built and is today operated
    and maintained by the Bureau of Reclamation. The Southeastern District
    has the financial responsibility for the reimbursable construction
    costs and annual operation and maintenance costs of the Project. That
    obligation is met through the assessment of a tax on all real and
    taxable personal property within the nine-county service-area of the
    District, and through direct water and storage charges. In 1999 the
    Southeastern District and our constituents will send the Bureau over
    $5.7 million. For the most part we consider it an investment in much
    needed water for our local communities.
        In 1997 the Bureau of Reclamation determined that major ``Safety of
    Dams'' (SOD) repairs were needed at the Pueblo Reservoir Dam, the
    largest storage facility in the Fry-Ark Project system. Initial cost
    estimates for the repairs were over $28 million. The costs would be
    over and above the annual repayment and O&M costs, and would be shared
    between the federal government and the Southeastern District. Under the
    federal Safety of Dams Act of 1978 and 1984, the Bureau (federal
    taxpayers) would pay for 85 percent of the costs while local sponsors
    pay for 15 percent of the costs. That means that the Southeastern
    District would pay about $4 million, which is about 60 percent of the
    District's $6.3 million total annual budget. The District has committed
    reserve funds and assessed additional user fees in order to meet this
    additional financial obligation.
        Because the District's financial obligations for the Fry-Ark
    Project are substantial, and growing, we take a keen interest in how
    the Bureau of Reclamation spends our constituents' dollars.
        Excessive Administrative Costs.--The Safety of Dams (SOD) project
    at Pueblo Dam has again raised concerns regarding the cost of the
    Bureau of Reclamation's administration of project operations and
    repairs (work began in 1997 and will be complete Spring 2001). As
    documented in our Cost Comparison Report, the Bureau of Reclamation's
    administration, or ``non-construction'' costs, of the SOD repair
    project (design, engineering, oversight, construction management,
    contract administration, etc.) Adds 48 percent to 58 percent to cost of
    the construction project, private-sector industry standards suggest the
    15 percent to 25 percent is a reasonable factor to administer a
    construction project of this type.
        The Bureau of Reclamation did not give the District the option to
    administer the SOD repair project ourselves (such authority may not
    exist). However, in a side-by-side comparison of the Bureau's estimated
    administrative costs and the cost to administer the project at a local
    level, we believe we could save at least $5 million. That would save
    the federal taxpayers $4.25 million and the District $750,000, which is
    a lot of money to us. It's simple to understand where the savings come
    from when you compare the organizational chart for the Bureau's
    administration with the organizational chart for our local option.
        The Added Cost of Overhead Surcharge.--All Bureau of Reclamation
    (BOR) direct labor costs charged to the Safety of Dams Project at
    Pueblo pay for the Bureau's administrative functions for the Project.
    In addition, the Bureau applies a surcharge to these direct labor costs
    to cover general BOR overhead. Based upon Bureau accounting of the
    total expenditures to date on this project ($5.2 million since fiscal
    year 1997), nearly $1.5 million is to pay for these overhead
    surcharges. To put that in perspective, the cost of direct labor for
    Bureau personnel to work on this project has cost $1.8 million to date.
    These overhead surcharges nearly double the administrative costs on
    this SOD project. In many cases the same is true for normal operation
    and maintenance on Bureau Projects. Because the Bureau of Reclamation
    handles the O&M for the Fry-Ark Project and assess a surcharge on every
    direct labor hour, a sizable portion of the District's annual payment's
    for O&M never benefit the Project. While these dollars are being
    siphoned off for general Bureau administration, we fall further and
    further behind in addressing critical repair and maintenance on Project
    facilities.
        Bureau Response to Date.--Bureau decision makers on the Pueblo Dam
    SOD Project have responded to the District's request to re-evaluate
    their non-construction costs. As we were negotiating a repayment
    contract for our share of these repair costs, we asked the Bureau to
    re-think their estimated costs for ``construction management.''
    Original estimates had this line item at $7.6 million just to manage
    the day-to-day work of the on-site contractor who actually does the
    repair work. With some repeated encouragement from the District, the
    Bureau did lower the estimated cost for construction management down to
    $4.3 million. The actual numbers will not be known for several months.
    Even with this adjustment in estimated costs, the Bureau's
    administration of this SOD Project nearly exceeds the actual bid price
    for the major construction component of the Project (contract for RCC
    placement--$8.9 million; Bureau non-construction costs--$8.3 million).
        Conclusions and Recommendations.--The Southeastern District is
    proud to be the local sponsor for the Fryingpan-Arkansas Project and
    has considered itself a willing partner with the Bureau of Reclamation
    on the development and operation of the Project since Congress
    authorized the Project in 1962. However, the present-day cost of doing
    business with the Bureau of Reclamation makes it more and more
    difficult for the District to afford the partnership. The excessive
    administrative charges and surcharges on the Pueblo Dam SOD Project are
    just one example of just how costly it is to do business with the
    Bureau. We have similar concerns with the Bureau's operation and
    maintenance of the Fry-Ark Project. It is difficult for us to
    repeatedly go back to our constituents to ask them for more money to
    keep pace with the Bureau's costly business practices.
        We offer the following recommendations as an alternative to the
    status quo:
        1. Allow for local administration of Safety of Dams projects and
    O&M on Bureau facilities to reduce costs to local beneficiaries and the
    federal taxpayer.
        2. Reduce the Bureau's administrative structure so that the
    fundamental services of the Bureau can be delivered at less cost--this
    would allow for a reduction in the overhead surcharge rates now being
    applied to maintain the current Bureau administrative structure.
        3. Totally eliminate or substantially reduce the overhead
    surcharges on all SOD projects--the general administrative functions of
    the Bureau should already be covered by the current surcharges on
    Project O&M and other direct charges.
        4. Review and audit the Bureau's application of their ``cost
    recovery objectives and policies'', and ``contracts and repayment
    policy''--local water users cannot even discuss their future water
    management objectives with the Bureau without being charged--where does
    this money go?
        Mr. Chairman and Members, your time and interest in these matters
    is greatly appreciated. As I present these issues and requests to you,
    I recognize the difficulty you have in meeting these needs along with
    the many others you have been presented. Of course, like the others,
    the requests of the Arkansas River Basin Interstate Committee are
    important to us and our constituents. Your fair consideration of the
    needs of the member states of the Interstate Committee is all that I
    can ask.
        Thank you for your commitment to the water resource needs of our
    citizens.
                                     ______

     Prepared Statement of Gerald H. Holman, Chairman for Kansas, Arkansas
                        River Basin Interstate Committee
        Mr. Chairman and members of the committee, I am Gerald H. Holman,
    Senior Vice President of the Wichita Area Chamber of Commerce, Wichita,
    Kansas and Chairman of the Kansas Interstate Committee for the Arkansas
    Basin Development Association. This statement is submitted on behalf of
    the entire Kansas Delegation.
        We are honored to join with our colleagues from the states of
    Oklahoma, Arkansas, Colorado, and Missouri to form the five (5) state
    Arkansas River Basin Interstate Committee. We are unified as a region
    and fully endorse the statement of the Arkansas River Basin Interstate
    Committee.
        In addition to the important projects listed below, we state our
    unanimous support for the continued construction of the authorized
    Montgomery Point Lock and Dam Project to maintain viable navigation for
    commerce on the McClellan-Kerr Navigation System. This inland waterway
    is vital to the economic health of our area. Your support is vital to
    maintain its future viability. Construction is well underway and
    continued funding authorization is needed. We state our unanimous
    support for the $44 million needed by the Corps of Engineers to
    maintain the most economical and cost efficient construction schedule.
        The water resources projects in the Kansas portion of the Arkansas
    River Basin have been carefully reviewed by the Kansas delegation and
    reflect accurately the need. Many of the projects are safety,
    environmental and conservation oriented. We are grateful for your past
    commitment and respectfully request your continued commitment.
        We ask for your continued support for these important Bureau of
    Reclamation projects on behalf of the Wichita/South Central Kansas
    area:
        1. Equus Beds Groundwater Recharge Demonstration Project.--This is
    the continuation of a Bureau of Reclamation project jointly endorsed by
    the City of Wichita, Groundwater Management District No. 2 and the
    State of Kansas. This model technology is demonstrating the feasibility
    of recharging a major groundwater resource supplying water to nearly
    one-half million irrigation, municipal and industrial users. The full
    scale project, when implemented, will capture flood flows from the
    Little Arkansas River providing water for use during times of low
    rainfall or dry conditions and will also reduce on-going degradation of
    the existing groundwater quality by minimizing migration of saline
    water. The Bureau of Reclamation pilot project is fully operational.
    Data positively supports predictions that the full scale project can be
    successful and is capable of meeting the increasing water resource
    needs of the area to the mid 21st century. The pilot project is
    scheduled for an additional two years to confirm early findings.
        The Equus Beds provides approximately half of the Wichita area
    regional municipal water supply. This recharge project is vital to the
    future of the metropolitan Wichita area and surrounding farming
    communities. Governor Graves supports this much needed project as a
    benefit to 20 percent of the state's population. We are grateful for
    your consistent funding support since fiscal year 1995 which totals $3
    million as a compliment to cost share funds provided by the City of
    Wichita.
        We request continued funding in the amount of $500,000 for fiscal
    year 2000.
        For fiscal year 1998, the Conference Committee also approved the
    following report language: ``The conferees direct the Bureau of
    Reclamation to notify the Committees on Appropriations of the House and
    the Senate before reprogramming any funds from the Equus Beds
    Groundwater Recharge Demonstration Project in Kansas.'' This or similar
    language was also approved in fiscal year 1999. We request this or
    similar language remain for fiscal year 2000.
        2. Cheney Reservoir.--The reservoir provides greater than 50
    percent of Wichita's regional water supply. Two environmental problems
    threaten the water quality and longevity of the reservoir. One is
    sedimentation from soil erosion and the other is non-point source
    pollution, particularly the amount of phosphates entering the reservoir
    resulting in offensive taste and odor problems. A partnership between
    farmers, ranchers and the City of Wichita has proven beneficial in
    implementing soil conservation practices and to better manage and/or
    eliminate non-point source pollution. This partnership must continue
    indefinitely to protect the reservoir and the Wichita water supply and
    therefore, on-going funding will also be important. The City of Wichita
    is providing funding for this critical, nationally acclaimed model
    project. We request continued funding in the amount of $125,000 for
    fiscal year 2000. As the funding from Section 319 of the Clean Water
    Act is phased out, we request another source to maintain funding at a
    total of $125,000.
        Recently, the Bureau of Reclamation completed a Comprehensive
    Facility Review for the Cheney Dam. The Review concluded that
    significant damage exists in the soil-cement slope of the dam, which
    must be fully determined, and needed repairs completed. Present plans
    are to lower the reservoir during the winter of 1999/2000 to accurately
    determine needed repairs and then complete those repairs. Lowering the
    reservoir the necessary 4 feet will reduce available water supply by 24
    percent. Repairs must be completed at the time the reservoir is
    lowered. We request funding support in the amount of $500,000 to
    accomplish the work required by the Bureau of Reclamation.
        3. Arkansas River Mineral Intrusion Study.--A critically important
    research is the Mineral Intrusion Study in the Equus Beds Aquifer along
    the Arkansas River between the cities of Nickerson and Hutchinson.
    Ground water pumping in the aquifer is inducing saltwater from the
    river into the freshwater supplies of the Equus Beds. The State of
    Kansas has supported this project with cost share monies and now the
    Bureau of Reclamation is funding completion of the modeling. Data
    collection was complete at year end 1998 and the report could be
    published by year end 1999. Special funding for this project is not
    needed in fiscal year 2000. However, following analysis of the study
    results, follow-on projects might be warranted along with federal
    funding.
        Many of our agricultural communities have historically experienced
    major flood disasters, some of which have resulted in multi-state
    hardships involving portions of the state of Oklahoma. The flood of
    1998 emphasized again the need to rapidly move needed projects to
    completion. Approximately 1,600 homes were damaged or destroyed with
    damage totaling approximately $38 million. Most of the damage occurred
    in Sedgwick, Butler and Cowley counties. Our small communities do not
    have the necessary funds or engineering expertise. Federal support is
    needed. Projects in addition to local protection are also important.
    This Committee has given its previous support to Kansas Corps of
    Engineers projects. We request your continued support for the projects
    listed below.
        1. Arkansas City, Kansas Flood Protection.--Unfortunately, this
    project was not completed prior to the flood of 1998. The flood
    demonstrated again the critical need to protect the environment, homes
    and businesses from catastrophic damages from either Walnut River or
    Arkansas River flooding. When the project is complete, damage in a
    multi-county area will be eliminated and benefits to the state of
    Oklahoma just a few miles south will also result. The Secretary of the
    Army was authorized to construct the project in fiscal year 1997. We
    request your continued support in the amount of $4.3 million for fiscal
    year 2000.
        2. Winfield, Kansas Flood Protection.--This project is scheduled
    for completion in June 1999. However, project closeout work will
    continue into fiscal year 2000. We greatly appreciate the support to
    complete the much needed project as was again demonstrated by the flood
    of 1998. We request continued funding at the level needed by the Corps
    of Engineers to closeout the project.
        3. Walnut and Whitewater River Watersheds, Kansas, Reconnaissance
    Study.--A reconnaissance study of the water resource problems in this
    watershed is critical. The devastating flood of 1998 left more than 600
    homes and businesses damaged in and around the city of Augusta. In
    addition, local officials are concerned about the economic future of
    the area due to water supply and infrastructure constraints. A study
    would evaluate the basin needs and would include a reevaluation of the
    proposed Douglass Lake project. We request funding in the amount of
    $100,000 to conduct the reconnaissance study.
        4. John Redmond Reservoir Reallocation Study.--John Redmond
    Reservoir remains a primary source of water supply for many small
    communities in Kansas. It is suffering loss of capacity ahead of its
    design rate because of excessive deposits within the conservation pool.
    The flood pool remains above its design capacity. A study would
    ascertain the equitable distribution of sediment storage between
    conservation and flood control storages and also evaluate the
    environmental impact of the appropriate reallocation. Funding
    requirements for the Corps of Engineers study is $550,000. We request
    your support.
        5. Upper Arkansas River Watershed, Kansas, Reconnaissance Study.--A
    reconnaissance study of the high flow carrying capacity of the Arkansas
    River from the Colorado State Line to the vicinity of Great Bend is
    important to western Kansas. This study would compliment the research
    accomplished on the Colorado portion of the river below the federally-
    constructed John Martin Dam. Lack of flows over the past two decades
    has allowed vegetation to encroach into the river channel, thereby
    restricting its ability to convey flood flows during runoff periods.
    Additionally, the delineation of the Ordinary High Water Mark
    separating the river channel property between the public trust and
    private lands has become muddled because of the lack of definition of a
    permanent channel in the Western Kansas reach. The study will evaluate
    the watershed changes to determine if flood damage prevention,
    watershed and ecosystem restoration or other solutions to water
    resource problems in the basin are warranted. We request this project
    be funded in the amount of $100,000 to complete the necessary research.
        6. Grand Lake Feasibility Study.--The Grand-Neosho River Committee
    was formed at the request of the Kansas and Oklahoma congressional
    delegations to evaluate water resource problems associated with the
    adequacy of existing real estate easements necessary for flood control
    operations which affect both Kansas and Oklahoma. A study authorized by
    the Water Resources Development Act of 1996 was completed in September
    of 1998 and determined that if the project were constructed based on
    current criteria, additional easements would be acquired. A Feasibility
    study is now required to determine the most cost-effective solution to
    the real estate inadequacies. Changes in the operations of the project
    or other upstream changes could have a significant impact on flood
    control, hydropower, and navigation operations in the Grand (Neosho)
    River system and on the Arkansas River Basin system, as well. We
    request funding in the amount of $3 million in fiscal year 2000 to
    fully fund Feasibility studies for this project.
        7. Grand (Neosho) Basin Watershed Reconnaissance Study.--A need
    exists for a basin wide water resource planning effort in the Grand-
    Neosho River basin, apart from the issues associated with Grand Lake,
    Oklahoma. The reconnaissance study would focus on the evaluation of
    institutional measures which could assist communities, landowners, and
    other interests in southeastern Kansas and northeastern Oklahoma in the
    development of non-structural measures to reduce flood damages. We
    request funding in the amount of $100,000 in fiscal year 2000 to
    conduct the study.
        8. Continuing Authorities Program.--We support funding for this
    program including the Small Flood Control Projects Program (Section 205
    of the 1948 Flood Control Act, as amended) as well as the Emergency
    Streambank Stabilization Program (Section 14 of the 1946 Flood Control
    Act, as amended). Smaller communities in Kansas (Iola, Liberal,
    Medicine Lodge, Iola, McPherson, Augusta, Parsons, Altoona and
    Coffeyville) have requested assistance from the Corps of Engineers and
    are currently on the waiting list. We urge you to support these
    programs to the $40 million programmatic limit for the Small Flood
    Control Projects Program and $15 million for the Emergency Streambank
    Stabilization Program.
        9. Operation, Maintenance and Planning Assistance Budgets.--To
    effectively manage water resources in the state, continued funding for
    the Corps of Engineers for planning assistance, operation and
    maintenance is needed, specifically for Water Control. Of particular
    interest at this time is on-going stream gaging support to help plan
    and develop solutions to potential flooding so the devastating effects
    of the flood of 1998 will not happen in the future. Continued funding
    at the programmatic limits, specifically for Water Control, is
    requested.
        Your continued support of a most important U.S. Department of
    Interior, Fish & Wildlife Service project is very much appreciated:
        1. Quivira National Wildlife Refuge.--This is a joint project
    involving the U.S. Fish & Wildlife Service--Region 6, the State of
    Kansas, the local Groundwater Management District and the Water
    Protection Association of Central Kansas. Quivira provides a resting
    area for waterfowl and endangered species during their annual
    migrations in the Central Flyway. The Refuge is comprised of a series
    of shallow pools totaling about 6,500 surface acre-feet and is part of
    the Rattlesnake Creek basin. The Rattlesnake Creek basin has
    experienced groundwater and streamflow declines due to climatic
    conditions as well as expansion of irrigated agriculture. An
    engineering feasibility study is nearing completion which will identify
    the watershed-based options available for producing the most efficient
    and effective use of the water resources in the Rattlesnake Creek basin
    to protect the Wildlife Refuge as well as the agriculture economy of
    the area. We appreciate your previous funding in fiscal year 1996 and
    fiscal year 1997. Federal funds along with cost share funds from the
    State of Kansas and area businesses/organizations were sufficient to
    complete the study. No funding was requested for fiscal year 1998 or
    fiscal year 1999 and none is requested for fiscal year 2000. However,
    future funding requests may be made.
        Finally, we are most concerned with any proposal to limit
    participation of both the Corps of Engineers and Bureau of Reclamation
    in development and protection of water resources infrastructure. It is
    essential to have the integrity and continuity these agencies provide
    on major public projects. Your continued support of these vital
    agencies, including funding, will be greatly appreciated. Our
    infrastructure must be maintained and where needed, enhanced for the
    future.
        Mr. Chairman and Members of this Committee, we thank you for the
    dedicated manner in which you and your colleagues have dealt with the
    Water Resources Programs and for allowing us to present our views and
    recommendations. We look forward with great expectations and hope for
    the future of water resource development in Kansas and the entire
    Arkansas River Basin.
                                     ______

      Prepared Statement of James M. Hewgley, Jr., Chairman for Oklahoma
                   Arkansas River Basin Interstate Committee
        Mr. Chairman and members of the committee, I am James M. Hewgley,
    Jr., Oklahoma Chairman of the Arkansas River Basin Interstate
    Committee, from Tulsa, Oklahoma.
        It is my privilege to present this statement on behalf of the
    Oklahoma Members of our committee in support of adequate funding for
    water resource development projects in our area of the Arkansas River
    Basin. Other members of the Committee are: Mr. Ted Coombes, Tulsa; Mr.
    Edwin L. Gage, Muskogee; and Mr. Terry McDonald, Tulsa; Mr. Lew
    Meibergen, Enid.
        Together with representatives of the other Arkansas River Basin
    states, we fully endorse the statement presented to you by the Chairman
    of the Arkansas River Basin Interstate Committee. We appreciate the
    opportunity to present our views of the special needs of our State
    concerning several studies, projects and programs.
        As we have testified in the past, serious problems exist at the
    waterway entrance to the McClellan-Kerr Arkansas River Navigation
    System. Extensive modeling and testing has proven that construction of
    Montgomery Point Lock and Dam is the only acceptable means to correct
    the problem. The project is well underway and adequate funding must
    follow to keep the project on its construction schedule.
        Your recognition, as well as that of the Administration, of the
    importance of constructing Montgomery Point Lock and Dam is very
    gratifying. To date, you and your colleagues have appropriated $107,3
    million for engineering, site acquisition and construction. This action
    is very much appreciated.
        We are grateful that the Congress, in Public Law 102-580, directed
    that ``The Secretary shall proceed expeditiously with design, land
    acquisition and construction of the Montgomery Point Lock and Dam on
    the White River, Arkansas, authorized as part of the McClellan-Kerr
    Waterway by section 1 of the River and Harbor Act of July 24, 1946 (60
    State. 635-363).''
        We respectfully request the Congress to appropriate $44 million in
    the fiscal year 2000 budget cycle to continue construction of the
    authorized project. This is the amount the Corps of Engineers has
    indicated is necessary to keep the project on schedule. This will help
    insure the project is completed and in operation as soon as possible at
    the lowest possible cost.
        Mr. Chairman, members of this distinguished Committee, we
    respectfully remind each of you this navigation system has brought low
    cost water transportation to Oklahoma, Arkansas and surrounding states.
    There has been in excess of $5 billion invested in the construction and
    development of the McClellan-Kerr Arkansas River Navigation System by
    the Federal Government and the public and private sector. There have
    been more than 50,000 jobs created as a result of the partnered
    investment.
        Tow Haulage Equipment, Oklahoma.--We strongly urge the Committee to
    provide funding in the amount of $1.5 million to initiate the
    installation of tow haulage equipment on the McClellan-Kerr Arkansas
    River Navigation System at designated locks in Oklahoma. This project
    would involve installation of tow haulage equipment on W.D. Mayo Lock
    and Dam #14, Robert S. Kerr Lock and dam #15, and Webbers Falls Lock
    and Dam #16, on the Oklahoma portion of the waterway. The tow haulage
    equipment is needed to make transportation of barges more economical by
    allowing less time for tows to pass through the various locks.
        We are particularly pleased that the President's budget includes
    funds to advance work for Flood control in Oklahoma. Of special
    interest to our committee is funding for the Skiatook and Tenkiller
    Ferry Lakes, Dam Safety Assurance Project in Oklahoma. We are pleased
    that construction funding has been provided for these important
    projects.
        We support funding for the Grand Lake and Arkansas River System
    Operations Feasibility Studies. We also support funding for
    reconnaissance studies of watershed development needs for the Cimarron
    River Basin, the Illinois River Basin, the Grand (Neosho) Basin
    Watershed, and the Upper Arkansas River Basin.
        Grand Lake Feasibility Study.--We support the ongoing effort to
    evaluate water resource problems in the Grand-Neosho River basin in
    Kansas and Oklahoma and request funding to initiate a comprehensive
    Feasibility study. We support the continued funding of studies to
    evaluate solutions to upstream flooding problems associated with the
    adequacy of existing real estate easements necessary for flood control
    operation of Grand Lake Oklahoma. A study, authorized by the Water
    Resources Development Act of 1996 was completed in September of 1998
    and determined that if the project were constructed based on current
    criteria, additional easements would be acquired. A Feasibility study
    is now required to determine the most cost effective solution to the
    real estate inadequacies. Changes in the operations of the project or
    other upstream changes could have a significant impact on flood
    control, hydropower, and navigation operations in the Grand (Neosho)
    River system and on the Arkansas River basin system, as well; we urge
    you to provide $3 million to fully fund Feasibility studies for this
    important project in fiscal year 2000.
        Cimarron River Basin reconnaissance Study.--We request funding in
    the amount of $100,000 to conduct a reconnaissance study of the
    Cimarron River Basin. Studies conducted by the Tulsa district in the
    1970's identified the potential for flood damage reduction measures in
    the Cimarron River Basin. Several potential multiple purpose reservoirs
    were considered for development in response to needs for flood control,
    water supply, fish and wildlife, and recreation. Development and
    operation of these projects in conjunction with the existing system of
    reservoirs in the Arkansas River Basin would provide for flood damage
    reduction along the Cimarron River downstream as well as along the
    Arkansas River from Keystone Dam near Tulsa to Fort Smith, Arkansas.
    These projects would also offer the potential for development of
    hydropower and navigation benefits along the McClellan-Kerr Arkansas
    River Navigation System. Additional water resource development,
    including restoration of habitat lost as a result of Federal
    construction and rehabilitation of Federally constructed watershed
    projects require further evaluation within the basin.
        Illinois River Watershed Reconnaissance Study.--We request funding
    in the amount of $100,000 to conduct a reconnaissance study of the
    water resource problems of the Illinois River Basin. The Illinois River
    watershed is experiencing continued water resource development needs
    and is the focus of ongoing Corps and other agency investigations.
    However, there are increasing watershed influences upstream of Lake
    Tenkiller which impact on the quality of water available for fish and
    wildlife, municipal and industrial water supply users, and recreation
    users of the Lake Tenkiller and Illinois river waters. The committee
    requests funding to initiate reconnaissance studies for the Illinois
    River Watershed in fiscal year 2000.
        Grand (Neosho) Basin Watershed Reconnaissance Study.--We request
    funding in the amount of $100,000 to conduct a reconnaissance study of
    the water resource problems in the Grand (Neosho) Basin in Oklahoma and
    Kansas. There is a need for a basin-wide water resource planning effort
    in the Grand-Neosho River basin, apart from the issues associated with
    Grand Lake, Oklahoma. The reconnaissance study would focus on the
    evaluation of institutional measures which could assist communities,
    landowners, and other interests in northeastern Oklahoma and
    southeastern Kansas in the development of non-structural measures to
    reduce flood damages in the basin. The committee requests funding to
    initiate reconnaissance studies in fiscal year 2000.
        Arkansas River System Operations Feasibility Study, Arkansas and
    Oklahoma.--We also request funding for a Feasibility study of the
    optimization of the Arkansas River system in Arkansas and Oklahoma. The
    system of multipurpose lakes in Arkansas and Oklahoma on the Arkansas
    River and its tributaries supports the McClellan-Kerr Navigation
    System, which was opened for navigation to the Port of Catoosa at
    Tulsa, Oklahoma, in 1970. The navigation system consists of 445 miles
    of waterway that winds through the states of Oklahoma and Arkansas.
    This study would optimize the reservoirs in Oklahoma and Arkansas that
    provide flows into the river with a view toward improving the number of
    days per year that the navigation system would accommodate tows. The
    committee requests funding of approximately $500,000 to initiate
    feasibility studies in fiscal year 2000.
        We also request funding for reallocation studies for John Redmond
    Reservoir in Kansas, Broken Bow, Wister and Tenkiller Lakes in
    Oklahoma.
        John Redmond Reservoir Reallocation Study.--We request funding of
    approximately $550,000 to conduct a reallocation study of the water
    storage of John Redmond Reservoir, Kansas. A reallocation study is
    needed at John Redmond Reservoir to insure an equitable distribution of
    sediment storage between conservation and flood control storage's. This
    study will help insure the project can continue to provide for both
    important water resource purposes.
        Broken Bow Lake Reallocation Study.--Public Law 102-580, PP 102(V)
    provided for the reallocation of a sufficient amount of existing water
    supply storage space to support the Mountain Fork Trout Fishery.
    Releases of water for the fishery is to be undertaken under terms and
    conditions acceptable to the Secretary of the Army.
        The Corps has been cooperating with the state of Oklahoma to make
    releases for the trout fishery in a series of demonstration programs
    since 1989. There is a Federal interest in the reallocation of storage
    from one project purpose if it achieves an increase in the net National
    Economic Development benefits and has no significant environmental
    impacts. However, recreation is a low priority for Army Civil Works
    funding and the Federal government is limited to no net out-of-pocket
    expense. A re-allocation study must be conducted to determine the
    amount of storage needed to support the fishery, costs, benefits, and a
    National Environmental Policy Act evaluation for impacts to existing
    project purposes and downstream environments. The results of this re-
    allocation study will be documented in a report to be used by the
    Assistant Secretary of the Army. The report will provide
    recommendations for future interim use arrangements. Mr. Chairman, we
    support funding in the amount of $170,000 for this study.
        Wister Lake Reallocation Study.--We request funding of
    approximately $450,000 to conduct a reallocation study of the water
    storage of Wister Lake, Oklahoma. Wister Lake is located on the Poteau
    River near Wister, Oklahoma. The lake was completed in 1949 for flood
    control, water supply, water conservation and sediment control. Wister
    Lake is the primary water resource development project in the Poteau
    River Basin. It provides substantial flood control, municipal and
    industrial water supply, and recreation benefits for residents of
    LeFlore County, Oklahoma, and the southeastern Oklahoma region.
    Originally constructed for flood control and water conservation,
    seasonal pool manipulation was initiated in 1974 to improve the
    project's water supply and recreation resources. The conservation pool
    level was permanently raised in the Water Resources Development Act of
    1996. A reallocation study, which would include National Environmental
    Policy Act (NEPA) coordination, is required. NEPA and other resource
    evaluation and coordination would include the assessment of cultural
    and fish and wildlife impacts, potential mitigation measures, and
    reallocation studies.
        Lake Tenkiller Reallocation Study.--We request funding of
    approximately $500,000 to conduct a reallocation study of the water
    storage of Tenkiller Ferry Lake, Oklahoma. Tenkiller Ferry Lake is
    located on the Illinois River approximately 7 miles northeast of Gore,
    Oklahoma, and 22 miles southeast of Muskogee, Oklahoma. Construction of
    the existing project began in June 1947 and the dam was completed in
    May 1952. The proposed study would involve reallocation of the
    authorized project purposes among competing users of the project's
    flood control, hydropower and water supply resources.
        We also support funding for the Continuing Authorities Program
    including the Small Flood Control Projects Program, (Section 205 of the
    1948 Flood Control Act, as amended) and the Emergency Streambank
    Stabilization Program, (Section 14 of the 1946 Flood Control Act, as
    Amended). We want to express our appreciation for your continued
    support of those programs.
        We request your support of the Planning Assistance to States
    Program (Section 22 of the 1974 Water Resources Development Act) which
    authorizes the Corps of Engineers to use its technical expertise in
    water and related land resource management to help States and Indian
    Tribes solve their water resource problems. The program is used by many
    states to support their State Water Plans. As natural resources
    diminish, the need to manage those resources becomes more critical. We
    urge your continued support of this important program as it supports
    States and Native American Tribes in developing resource management
    plans which will benefit citizens for years to come. The program is
    very valuable and effective, matching Federal and non-Federal funds to
    provide cost effective engineering expertise and support to assist
    communities, states and tribes in the development of plans for the
    management, optimization, and preservation of basin, watershed, and
    ecosystem resources. The Water resources Development Act of 1996
    increased the annual program limit from $6 million to $10 million and
    we urge this program be fully funded to the programmatic limit of $10
    million.
        Section 205. Although the small Flood control Projects Program
    addresses flood problems which generally impact smaller communities and
    rural areas and would appear to benefit only those communities, the
    impact of those projects on economic development crosses county,
    regional, and sometimes state boundaries. The communities served by the
    program frequently do not have the funds or engineering expertise
    necessary to provide adequate flood damage reduction measures for their
    citizens. Continued flooding can have a devastating impact on community
    development, so much so, in fact, that there is currently a backlog of
    requests from communities who have requested assistance under this
    program. Oklahoma communities that have requested assistance from the
    Corps of Engineers under the Section 205 authority and are currently on
    a waiting list include Cherokee, Sayre, Dewey, McAlester, Claremore,
    and Warr Acres. Additionally, the Pawnee Indian Tribe has requested the
    Corps' assistance with flooding problems. We urge this program be fully
    funded to the programmatic limit of $40 million.
        Section 14. Likewise, the Emergency Streambank Stabilization
    Program provides quick response engineering design and construction to
    protect important local utilities, roads, and other public facilities
    in smaller urban and rural settings from damage due to streambank
    erosion. The protection afforded by this program helps insure that
    important roads, bridges, utilities, and other public structures remain
    safe and useful. By providing small, affordable, and relatively quickly
    constructed projects, these two programs enhance the lives of many by
    providing safe and stable living environments. There is also a backlog
    of requests under this program; counties in Oklahoma that have
    requested assistance under the Section 14 authority and are on a
    waiting list include Blain, Wood, Kiowa, and Kingfisher. The city of
    Clinton, Oklahoma, and Waurika Master Conservancy District have also
    requested assistance. We urge this program be funded to the
    programmatic limit of $15 million.
        Sections 1135 and 206. We also request your continued support of
    and funding for the Ecosystem restoration Programs (Section 1135 of the
    Water Resources Development Act of 1986 and Section 206 of the Water
    Resources Development Act of 1996). The Ecosystem restoration Programs
    are relatively new programs which offer the Corps of Engineers a unique
    opportunity to work to restore valuable habitat, wetlands, and other
    important environmental features which previously could not be
    considered. Local interest has been expressed for potential ecosystem
    restoration projects located at Great Salt Plains Reservoir, the
    Mountain Fork River, Meadow Lake, and the North Canadian River in
    Oklahoma. The Section 1135 Program is already providing significant
    benefits to the states of Kansas and Oklahoma. A Section 1135 project
    is complete at Arcadia Lake in Oklahoma. A Section 1135 project is
    underway at the Sequoyah National Wildlife Refuge. We urge that these
    programs be fully funded to programmatic limit of $25 million each.
        We also request your continued support of the Flood Plain
    Management Services Program (Section 206 of the 1960 Flood Control Act)
    which authorizes the Corps of Engineers to use its technical expertise
    to provide guidance in flood plain management matters to all private,
    local, state, and Federal entities. The objective of the program is to
    support comprehensive flood plain management planning. The program is
    one of the most beneficial programs available for reducing flood losses
    and provides assistance to officials from cities, counties, state, and
    Indian Tribes to ensure that new facilities are not built in areas
    prone to floods. Assistance includes flood warning, flood proofing, and
    other flood damage reduction measures, and critical flood plain
    information is provided on a cost reimbursable basis to home owners,
    mortgage companies, realtor's and others for use in flood plain
    awareness and flood insurance requirements.
        We also request your support and funding for the Challenge 21
    Program. The Challenge 21 Program is in support of the Clean Water
    Action Plan and would provide opportunity for the Corps of Engineers to
    work closely with other Federal, State, and Local land and water
    resource agencies to develop comprehensive solutions to reduce flood
    damages and improve quality of life. The program would focus on
    watershed-based solutions that could also include the restoration of
    riparian and wetland ecosystems. Although the construction of dams and
    levees has prevented billions of dollars in flood damages, many
    communities still experience disastrous flood events. Some of that
    flooding can be attributed to over development in and around the flood
    plain. The Challenge 21 program will focus on opportunities to move
    homes and businesses from harms way through structural and non-
    structural measures and through comprehensive watershed planning
    efforts. We support funding of this important initiative.
        On a related matter, we would share with you that we are greatly
    concerned that the Administration has not requested sufficient funds to
    meet the increasing infrastructure needs of our nation. The
    Administration's request for $3.9 billion will not keep projects moving
    at the optimum level to complete them on a cost effective basis. Moving
    the completion dates out is an unacceptable exercise since 50 percent
    of the funds come from the Waterways Trust Fund. This will not only
    waste federal funds but, those from the trust fund as well.
        The Administration's proposal to use the money from the not-yet-
    enacted Harbor Services Fund, is akin to counting your chickens before
    they hatch. Mr. Chairman, this committee finds that proposal
    unacceptable. We strongly urge the Appropriations Committee to raise
    the Corps of Engineers budget to $4.7 billion so that the Corps can
    meet the obligations of the Federal Government to people of this great
    country.
        Concerning another related matter, we have deep concerns about the
    attempt to re-authorize the Endangered Species Act without significant
    beneficial reforms. If a bill is passed through without reforms, it
    will be devastating to industry and the country as a whole. We strongly
    urge you to take a hard look at any bill concerning this re-
    authorization and insure that it contains reasonable and meaningful
    reforms.
        The Tenkiller Utilities Authority.--The Tenkiller Utilities
    Authority (TUA) was established October 19, 1998 as a Public Trust
    under Oklahoma Law. TUA is comprised of twenty-nine (29) rural water
    districts, rural towns, and Native American Governments. TUA's main
    purpose is the production of safe drinking water on a wholesale basis
    distributed through our Authority members to about 60,000 retail
    customers. About 12,000 of that number are not presently serviced at
    all. Current providers are individually struggling to meet increasingly
    stringent drinking water standards and some are operating with outdated
    equipment. By coming together under a single Authority, providers can
    gain economies of scale and provide uniform, high quality water at
    consistent prices.
        TUA has been working closely with the Oklahoma water resources
    board, the U.S. Army Corps of Engineers, Eastern Oklahoma Development
    district, Cherokee Hills Resource Conservation and Development Project,
    and the Cherokee Nation. The cooperation and partnering among these
    groups has been outstanding. The TUA has been successful in bringing
    together, in a single regional entity, varied interests who share a
    common goal: Improving the health and quality of life for all citizens
    in the Lake Tenkiller region. The great challenge now before the TUA is
    to finalize the plan and build the system. The members of the TUA
    believe they can make it happen.
        Mr. Chairman, we include the section on The Tenkiller Utilities
    Authority to show that the studies and projects that are supported by
    the Arkansas River Basin Interstate Committee, are necessary and
    essential to the further development of rural utilities and compliance
    with mandated government regulations as they relate to water resources.
        Mr. Chairman, we appreciate this opportunity to present our views
    on these subjects.
                                     ______

     Prepared Statement of Christopher J. Brescia, President, Midwest Area
                              River Coalition 2000
        Mr. Chairman and Members of the Committee, I am Christopher J.
    Brescia, President of the Midwest Area River Coalition 2000 (MARC
    2000). Thank you for the opportunity to submit our coalition's views on
    the needs of the Mississippi Valley.
        I would like to structure this testimony to address:
      --The shortcomings in the President's fiscal year 2000 Budget for the
            Mississippi Valley Corps of Engineers programs;
      --Specific Upper Mississippi/Illinois Waterway fiscal year 2000
            appropriations need; and
      --Specific concerns with the Upper Mississippi/Illinois Waterway
            Navigation Feasibility Study.
                                   background
        Over 60 percent of the U. S. grain exports reach world markets by
    transiting the Upper Mississippi River system to our Gulf ports.
    Returning traffic often brings agricultural inputs, petroleum, coal,
    steel, cement and other materials into the inner reaches of the
    Midwest. These exports contribute, on average, $18 Billion per year to
    our balance of trade and are fundamental to supporting farmer incomes.
        According to the independent accounting firm Price Waterhouse,
    barge traffic originating and terminating on the Upper Mississippi and
    Illinois Rivers has been estimated to support over 153,000 full-time
    equivalents (FTEs) or between 306,000 to 459,000 full and part-time
    jobs in the 10-state Mississippi River Valley. These jobs are estimated
    to generate $4 Billion in income and between $11-15 Billion in business
    revenue. This data reinforces other data establishing the strong
    linkage between the Upper Mississippi and Lower Mississippi Valleys.
        Our sixty-year-old lock and dam system on the Upper Mississippi and
    Illinois Rivers has provided reliable, environmentally friendly and
    cost-effective barge transportation which currently provides net
    transportation savings of $1.5 Billion per year to the U. S. economy,
    including $671 million in savings to farmers. However, in order to
    continue these benefits, certain lock chambers need to lengthened to
    accommodate modern tows (Tow boat with 15 barges).
        While the 35 dam locations are structurally sound, traffic volume
    has grown from 2 million tons to over 100 million tons of cargo,
    creating congestion choke points at the lower portion of the system
    (five locations on the Upper Mississippi River and two on the Illinois
    River). This congestion is costing our economy millions of dollars per
    year and is expected to grow exponentially as traffic increases by 63
    to 100 percent over the next 30 years. River congestion, contributing
    to transportation cost inefficiencies, is a key determining factor that
    leads to reduced farmer income for those grains exported and in
    relation to the overall price of corn, soybean and wheat in the
    heartland. Without efficient water transportation U.S. exports will
    continue to decline and farmer income will suffer needlessly.
    Preliminary results from a Texas A&M study identify a potential loss of
    between $100-$150 million per year to agricultural producers if
    congestion choke points limit our capacity to process traffic
    efficiently.
            fiscal year 2000 mississippi valley appropriations needs
        The Mississippi Valley's civil works needs are under funded by
    approximately $190 million. The total requested level of $685 million
    needs to be raised to $875 million in order for key projects to be
    completed at optimum levels. The President's budget shorts the
    Mississippi Valley construction program by over $100 million resulting
    in inefficient time lines, extended schedules, delayed projects, broken
    commitments to the local sponsors and loss of benefits to the nation.
        The President's budget continues to place a strain on the operation
    and maintenance of the system. It does not even provide sufficient
    funds to cover ``non-deferrable'' maintenance and operations services,
    the bare essentials. An additional $108 million would be needed to take
    care of these problems.
        The perils of flooding that led to the creation of the Mississippi
    Rivers and Tributaries project are at a higher risk with the
    President's budget. This integrated project protecting the populations
    of seven states is quickly eroding in credibility. Levees in place are
    as much as six feet below grade in height, in other areas below grade
    in sections. The risk of not providing sufficient funding for this
    program of national significance is unsupportable. Approximately $70
    million in additional funds are needed for the 20+ projects within the
    scope of this program and for general maintenance.
        specific upper mississippi fiscal year 2000 appropriation needs
        Within the Mississippi Valley's needs, there are approximately
    $40.5 million additional dollars necessary in the Upper Mississippi,
    Illinois and Missouri Rivers programs. We would urge the following
    funds be made available accordingly:

                            [In millions of dollars]
    ------------------------------------------------------------------------
                                               Budget    What we
                                              request      want     Variance
    ------------------------------------------------------------------------
    General Investigations:
        Upper Miss Nav Study...............      6.700     15.700       9.00
        Upper Miss Flow Frequency..........      2.100      2.100  .........
        Comprehensive Plan Study...........  .........      2.000       2.00
                                            --------------------------------
          Subtotal.........................  .........  .........      11.00
    Construction General:
        L&D 24 Part 1 Rehab................      3.844      3.844  .........
        L&D 24 Part 2 Rehab................      1.200      1.200  .........
        L&D 25 Rehab.......................      4.560      4.560  .........
        Mel Price..........................      2.900      3.900       1.00
        EMP................................     18.955     18.955  .........
        L&D 12 Rehab.......................      2.600    ( \1\ )    ( \1\ )
        L&D 14 Rehab.......................      4.092    ( \1\ )    ( \1\ )
        Missouri River Mitigation..........      5.000     10.000       5.00
        L&D 3 Rehab........................      3.200      3.200    ( \1\ )
        MS River (MO-OH)...................      3.000      4.500       1.50
                                            --------------------------------
          Subtotal.........................  .........  .........       7.50
    Operation & Maintenance:
        MS River, MN-MO....................    103.547    108.547       5.00
        MS River (MO-OH)...................     13.544  .........  .........
        Illinois Waterway..................     25.368  .........  .........
        Kaskaskia River Nav................      1.588  .........  .........
        Missouri River.....................      7.812  .........  .........
        Major Maintenance..................  .........      17.00      17.00
                                            --------------------------------
          Subtotal.........................  .........  .........      22.00
                                            --------------------------------
          Total............................  .........  .........      40.50
    ------------------------------------------------------------------------
    \1\ Major maintenance.

        Additional funds are needed to implement an expedited pre-
    construction and design initiative for seven locks extensions on the
    Upper Mississippi River and Illinois Waterway. Addressing these
    function now, during the study phase lowers our competitive risk and
    prepares for whenever Congress authorizes construction, rather than
    waiting until the full study is completed. In addition, additional
    funds are needed to initiate a comprehensive study for an integrated
    flood control system in the Upper Mississippi Basin.
        Funding from the construction account in the Upper Mississippi
    Basin is close to capability levels, except for two categories and the
    Missouri mitigation program. It is important that additional funding be
    provided for these accounts to meet efficient time lines and to create
    additional opportunities for finding creative ways of enhancing the
    habitat restoration on the Missouri River. Those projects with an
    asterisk have Major Maintenance counterparts to the Major Rehab
    projects underway.
        One of the most vexing problems has been the lack of operation and
    maintenance funds to sufficiently address dredging needs, major
    maintenance needs at key locks and some key safety concerns. An
    additional $5 million is needed for dredging alone. In many cases the
    least cost alternative may not be the environmentally preferred
    alternative needing additional funds. In addition, at L&D #3, there is
    a clear safety concern requiring extension of the Guardwall Major
    Maintenance Project ($13.3 M) for which no funds are available. At L&D
    12 & 14 there are over $40 million in Major Maintenance project needs
    that should be expedited. In addition, L&D 27 requires an additional
    $1.1 M in major maintenance repairs. All these facilities have exceeded
    their design life and are critical to the functioning of the system.
    For example, in 1997 L&D 27 was closed for 50 days to replace parts on
    the miter gates. The estimated cost to navigation for tows waiting was
    estimated to be $17.5 million that year.
       concerns with the upper mississippi/lllinois waterway navigation
                               feasibility study
        Mr. Chairman, we have lost confidence in the Upper Mississippi
    River/Illinois Waterway Feasibility process. We recommend that this
    Committee review the process and methodology and take whatever steps
    are necessary to direct the Corps of Engineers to provide Congress with
    an Interim Feasibility report by June 2000. The competitive position of
    our nation is at stake and we must be prepared to have Congress
    informed sufficiently to make important authorization decisions in a
    WRDA 2000. An independent economic critique will be provided the
    Committee within the next six weeks to help clarify technical and
    theoretical flaws in the approach chosen by the Corps of Engineers.
    MARC 2000 is also prepared to make technical experts available for a
    briefing of Committee Members and staff as might be deemed appropriate.
        MARC 2000 has been part of this study process, working with the
    Corps of Engineer, other federal agencies and State government
    representatives for the last six years. Although we can point to some
    positive outcomes to this process, we are dismayed by the ``new'' and
    improved economic model used for calculating benefits and cost. Let's
    examine some of the assumptions that are embedded in this thinking:
        (1) While barge rates will increase due to congestion on the river,
    rail rates will not increase over the next 50 years and rail will be
    able to absorb any movements of commodities leaving the river.
        Mr. Chairman, we spent two days at Secretary Glickman and Slater's
    Transportation Summit last year and heard testimony from rail
    representatives indicating the lack of any additional capacity to move
    grain. In addition, when coming to this conclusion the Corps
    acknowledged that they did not consider the increased costs to rail
    that would have to be borne to increase terminal and switching
    capacity. And, in interviews with grain companies who use both rail and
    water, they indicate that the evolving patterns of grain movement, due
    to global competition are moving in the exact opposite direction
    required by the rail companies--that is movements over part of the year
    instead of the whole year. Anyone with any common sense understands the
    irrational logic behind this assumption, if not the skepticism we hold.
        (2) In accepting traffic forecasts, the Corps of Engineers accepted
    growth lines that do not take into consideration the major impact
    biotechnology will have in increasing corn and soybean yields or
    developing specialty grains for export customers.
        Despite considerable documentation provided by leading biotech
    companies and commodity groups, the Corps refuses to accept this
    possibility in determining the National Economic Development Plan. Many
    experts agree we are on the threshold of major potential in this field.
    If the Corps is charged to think on a 50-year time line, then they must
    incorporate this information accordingly.
        (3) Because the Corps is unable to empirically prove the
    relationship between barge freight increases and whether grain will
    stay or not stay on the river, they have qualitatively determined
    ``barge freight demand curves.''
        I won't go into details about this here, our economic paper will,
    but consider the following. This model assumption claims that
    relatively small increases in barge rates will lead to major diversion
    of grain to other uses and conversely, lowering of barge rates
    sufficiently will lead to major exports of U. S. grain. This assumption
    is held without regard to knowing the demand capacity of other uses.
        Think about that, we are asked to have faith in a model that not
    only predicts that under certain conditions we will export the total
    production of the nation, but also predicts that we will export the
    entire production of the world. What are we going to do, import grain
    from South America and then export it down the Mississippi River for
    export to Asia? Our experts have evaluated this model, taken it apart
    and had discussions with lead economists in the Corps and are aghast at
    the lack of understanding of basic economic principles and market
    functions.
        (4) This model does not take into account the strategic decisions
    of competing nations in meeting global customer needs.
        This study is supposed to be evaluating the cost and benefits of
    investing in infrastructure improvements for the future. This cannot be
    done in isolation of global actions. When strategic investments are
    considered in many other areas of this country's functioning,
    countering foreign competition is an integral determinant for timing
    investment decisions. We do this in business all the time. Not
    factoring in the competition's capabilities into our strategy to
    overcome the competition, is selling our country short.
        (5) When calculating benefits of the waterway system, the non
    water-based environmental benefits are not included.
        There is strong documentation attesting to lower fuel consumption,
    lower air emissions and much lower accident rates for barge
    transportation over other modes. Over the next 50 years the Corps
    conservatively estimates a 63-100 percent increase in traffic. No
    societal benefits are attributed to foregone emission clean up costs,
    energy consumption, fewer fatalities and reduced congestion in our
    communities. Everywhere in the world societies understand the benefits
    of moving bulk commodities on the river system, to keep congestion out
    of cities and volumes off roads, except in the Upper Mississippi
    Valley. There are no benefits provided for the savings in road repairs
    that 100 million more tons would cause if truck became the next
    alternative.
        (6) Finally, we are asked to accept a model output that recommends
    an investment schedule based on average growth as it occurs, rather
    than anticipating growth.
        Grain markets, especially, do not grow systematically. They react
    to many factors in the production process, ocean-going freight rates,
    weather around the globe and economic growth cycles of many customers.
    Therefore, they have many peaks and valleys. If we don't build the
    infrastructure that will allow the U.S. to grow into market demand, we
    will lose out further to the competition. If we wait for the congestion
    on the river to choke us, and try to implement band-aid small-scale
    investment ideas in key congestion areas, then we will lose. If we had
    built our highway system to carry existing traffic levels without
    consideration for growth, we would not have the productivity gains that
    have permitted our nation's economy to excel. The same principles apply
    to the waterways.
        Thank you for your consideration.
                                     ______

        Prepared Statement of George E. Wolf, Jr., P.E., Assistant City
            Manager/Director of Public Works, Kansas City, Missouri
        The City of Kansas City, Missouri welcomes the opportunity to
    provide written testimony to the Subcommittee on Energy and Water
    Development regarding appropriations for fiscal year 2000. Herein we
    discuss our concerns with the President's recommended fiscal year 2000
    budget as it relates to flood control projects in the Kansas City area
    dependent on annual federal funding. All of these projects are
    essential to the sustainment and revitalization of prominent and long-
    standing commercial, business and industrial communities in this
    region, and when complete will provide substantially increased levels
    of flood protection. Some of these projects are located on urban
    streams subject to severe flash flooding, which run along major
    roadways, resulting in an extremely hazardous threat to public safety.
        The enclosed attachment shows our fiscal year 2000 funding request
    made to the Office of Management and Budget last October. Our
    presentation to OMB was made the morning after yet another terrible
    flood event ravaged Kansas City taking the lives of eleven people in
    our community. The most devastating floods were along Turkey Creek and
    Brush Creek, a tributary of the Blue River. Seven of the fatalities
    occurred on a bridge crossing Brush Creek just upstream of the Blue
    River. The small waterway opening at this location restricts the flow
    in Brush Creek and acts as a dam, backing up floodwater to dangerous
    depths prior to it overtopping the bridge. The City plans to replace
    the bridge as soon as possible however, the unimproved Blue River
    Channel is inadequate to convey the unrestricted flows from upstream.
        The Blue River Channel project, currently under construction,
    represents our most pressing need and for fiscal year 2000 we are
    requesting that this project be appropriated $25,000,000. This will
    allow the Corps to make significant progress on the next phase of the
    Blue River project which reaches upstream to Brush Creek. Work in that
    reach could then be completed in the fall of 2001, construction of the
    final phase begun at that same time and the entire project completed in
    2003, overall a twenty year construction project. Construction began in
    1983 and was originally scheduled for completion in 1998; that has been
    continually extended due to federal funding constraints.
        The Blue River Channel project when complete will significantly
    reduce the flood threat to inhabitants of the Blue Valley.
    Additionally, the river winds through a long-standing business district
    that, after much severe flooding, has now been partially abandoned. The
    channel improvement will bring many of those sites out of the
    floodplain and will reduce flooding depths by six to eight feet. This
    will serve as a means to help reclaim those Brownfield sites in the
    valley for redevelopment, and to once again build a thriving Blue
    Valley community.
        Kansas City, Missouri appreciates the past assistance we have
    received with local flood control projects. We are prepared to provide
    our share of funding in the future, and respectfully request that
    federal funding adequate to keep these very important projects moving
    toward the soonest possible completion be appropriated in the upcoming
    year.
             fiscal year 2000 appropriations flood control projects
        The City of Kansas City, Missouri, in cooperation with the Corps of
    Engineers, presently have five major flood damage reduction projects
    underway. These consist of the Blue River Channel, Blue River Basin,
    (also known as Dodson Industrial District), and Swope Park Industrial
    Area, all along the Blue River in Kansas City, Missouri; and, the
    Turkey Creek Basin and Kansas Citys, (the study of seven Missouri River
    levees), both in Missouri and Kansas.
        Kansas City fully recognizes the importance of flood control to our
    community. Over the past several years we have spent nearly $65 million
    on major flood control projects being done in cooperation with the
    Corps of Engineers. We appreciate the past assistance we have received
    with these projects, and are prepared to provide our share of funding
    in the future.
        Our fiscal year 2000 federal appropriations request for the flood
    control projects is presented in the following table, together with the
    activity to be performed with those funds by the Corps of Engineers.

    ------------------------------------------------------------------------
                                                Fiscal year     President's
                Project/Activity               2000 request       budget
    ------------------------------------------------------------------------
    Blue River Channel, Kansas City,             $25,000,000     $13,700,000
     Missouri: Continue Construction........
    Blue River Basin (Dodson Industrial              500,000         377,000
     Dist.), Kansas City, Missouri: Complete
     Plans,Engineering & Design.............
    Turkey Creek Basin, Kansas and Missouri:         300,000         266,000
     Continue Plans, Engineering & Design...
    Swope Park Industrial Area, Kansas City,          60,000          58,000
     Missouri: Complete Feasibility Study...
    Kansas Citys (7 River Levees), Kansas            350,000         315,000
     and Missouri: Begin Feasibility Study..
    ------------------------------------------------------------------------

        The City of Kansas City, Missouri, also requests that the several
    key programs which provide federal assistance for flood mitigation
    continue to be made available to local communities and that they be
    generously supported with annual appropriations. Among these: Small
    Flood Control Authority, Section 205 of the 1948 Flood Control Act as
    amended; Flood Plain Management Services, Section 206 of the 1960 Flood
    Control Act; Planning Assistance to States, Public Law 93-251; and
    Emergency Bank Stabilization, Section 14 of the 1946 Flood Control Act
    as amended. We have made use of these programs in the past and will
    continue to seek out beneficial uses for them in the future.
                                     ______

    Prepared Statement of Fred Thomas, Sr., Chairman, Pikitanoi Rural Water
                         Supply System, Kickapoo Tribe
                    fiscal year 2000 appropriations request
        The Kickapoo Tribe of Kansas joins with the State of Kansas and
    rural water districts in 19 counties in the northeastern corner of the
    state to seek funds for a ``special study'' of drinking water needs in
    the region as a continuation and expansion of planning for the
    Pikitanoi Rural Water System, Kansas. The amount requested is $500,000.
    The ``special study'' has a total estimated cost of $1,000,000 and
    contemplates two years of effort with funding of $500,000 in fiscal
    year 2000 and $500,000 in fiscal year 2001.
        Planning of the project by the Kickapoo Tribe, coordinating with
    the State of Kansas, began in 1996 and has proceeded to the point that
    federal funds are needed for continuation. All funds for the project to
    date have been furnished by the Kickapoo Tribe from its private, non-
    federal resources. The Kickapoo Tribe requests that funds appropriated
    for the project will be included in the Corps of Engineers' budget for
    Water Development.
                            significant developments
        As will be related in the discussion of the history section of this
    testimony, there have been significant developments in the project. As
    originally planned by the Kickapoo Tribe, the project involved a seven
    county area. Interest in the project has grown to the point that as
    many as 19 counties are now seeking participation in the planning
    process. The primary reason for interest is the shortage of high-
    quality water in this part of Kansas.
        The State of Kansas supports the planning effort based on recent
    agreements in concept for the ``special study.'' The key to the
    investigation is the study of alternatives to determine if a single
    system to serve the project area is most appropriate from a financial
    standpoint. The development of a single system will be compared with
    the costs of developing several smaller and separate systems. More than
    one source of water may be involved. While the Missouri River was
    identified as the best source of water for the seven county area, the
    ``special study'' will address sources of water at existing reservoirs
    on streams tributary to the Missouri River and groundwater potential,
    even though both potentials may be at some distance from the point of
    demand. In summary, a comprehensive investigation of water source and
    configuration alternatives will be undertaken in the ``special study.''
        Finally, while the Corps of Engineers is neither an advocate nor
    supporter of the project, there has been an effort with the Kansas City
    District to identify the scope and magnitude of the ``special study.''
    If asked, we believe the Corps of Engineers will confirm that the
    request for appropriations for the ``special study '' is reasonable
    given the level of effort required to develop sound cost estimates of
    alternatives to arrive at the best plan for the region.
                               history of project
        The need for funds for the ``special study'' is long standing.
    Several investigations have been undertaken of northeastern Kansas for
    the purpose of arriving at a solution to a growing shortage of quality
    water.
        The Corps of Engineers studied needs of the area as early as 1993
    in Partners for Environmental Progress, Type I Feasibility Study,
    Northeast Kansas Water Supply. Costs of alternative projects in the
    1993 report ranged from $38.0 to $128.4 million, depending on demand
    assumptions.
        The Department of Agriculture developed the Upper Delaware and
    Tributaries Watershed Plan in 1994. This project studied the water
    needs of the Kickapoo Nation and other water needs of the region. The
    primary supply for the regional project was Perry Reservoir. The
    project contemplated the development of a small reservoir on the
    Kickapoo Indian Reservation to supply drinking water to the Tribe.
        The Kickapoo Tribe completed a needs assessment of its present and
    future population and associated water requirements within the
    boundaries of the Kickapoo Indian Reservation as part of the Pikitanoi
    Project planning. The needs assessment also included submissions from
    10 rural water districts and 11 communities within the original study
    area, which included parts of Doniphan, Brown, Nemaha, Pottawatomie,
    Jefferson, Jackson and Atchison Counties.
        The Kickapoo Tribe planned a wholesale water supply system to serve
    the area, including the Reservation. The preliminary cost estimate,
    based on the system shown in Figure 1 for a system diverting from the
    Missouri River near Atchison, was $127 million. See Table 1 for a
    statistic summary of the original project. The project would include
    304 miles of pipeline from 4'' to 24'' in diameter and 15 pumping
    stations of 1,300 horsepower or less. At the original level of
    interest, the treatment plant and transmission lines would be sized for
    a demand of 11.6 million gallons per day or 9,669 gallons per minute.
    The system configuration and the cost estimate were expected to change
    as more rural water districts joined in the feasibility analysis.
        Since completion of the Kickapoo investigation in 1997, other
    systems in the original seven county area have expressed interest in
    the project and are supplying information on future needs and points of
    interconnection to the Pikitanoi Rural Water System. Additionally, the
    cities of Hays and Russell have expressed interest in the project.
    Their needs and needs of their region expand the area of interest in
    the project to an additional twelve counties west of the original
    project on both sides on Interstate 70. New counties in the project
    include Leavenworth, Marshall, Riley, Geary, Shawnee, Dickinson,
    Ottawa, Saline, Lincoln, Ellsworth, Russell and Ellis, bringing the
    total to 19 counties. Figure 1 distinguishes between the original and
    the expanded areas, including the cities of Hays and Russell.
        The Kickapoo Tribe and other entities are coordinating with the
    State of Kansas and the Kansas Rural Water Association. The funds
    requested for fiscal year 2000 will be used to continue investigations
    by the Kickapoo Tribe, rural water districts and communities in the
    northeast corner of Kansas. The work will be conducted by non-federal
    entities with oversight by the Corps of Engineers.
           alternatives for water supply are subject of special study
        The need for drinking water in northeast Kansas is acute. Local
    surface water and groundwater sources are highly developed. When a
    request of the Kickapoo Tribe for additional water from its current
    emergency supplier, the City of Horton, was made, it became clear that
    the City was without options to increase deliveries to the Reservation.
    The Tribe now relies on the flows of the Delaware River at a diversion
    point constructed by the Corps of Engineers. The flows of the stream at
    the point of diversion are not dependable and will fall to zero (no
    flow) during times of drought. The lack of adequate water supply to
    meet the needs of other water systems included in the original service
    area is common throughout northeastern Kansas, as evidenced by the
    considerable interest of rural water districts and communities in this
    project.
        Project participants are examining a number of alternatives for
    water source, transmission and distribution. The original project
    examined Perry Lake and Tuttle Creek Lake, projects owned by the State
    of Kansas as water supply sources . The Kickapoo Tribe has received
    authorization for construction of a reservoir on the Delaware River
    within the Reservation, and the applicability of this project to the
    overall regional system will be evaluated. The Missouri River forms the
    eastern boundary of the project area and constitutes an unlimited high-
    quality supply of water. Groundwater is a good source in some areas and
    is poor in others. All alternative water sources will be investigated
    for the development of a single regional rural water project or
    multiple projects.
                                  organization
        It is contemplated that the Corps of Engineers will provide
    planning oversight for the ``special study.'' The participating non
    federal entities in the planning process will include the Kickapoo
    Tribe, a new entity formed by the water user districts and communities,
    and the State of Kansas.
        Federal procurement procedures will be followed to allocate funds
    for the project to the entities involved in the planning process. For
    those project tasks to be undertaken by the Kickapoo Tribe, a
    cooperative agreement based on PL 93-638 contract principles between
    the Corps and the Tribe will govern. It is anticipated that cooperative
    agreements between the Corps and other non-federal entities will be
    formulated and that those cooperative agreements will specify the scope
    of work to be undertaken by those entities and the procurement
    practices to be applied.

         TABLE 1.--STATISTICAL SUMMARY PIKITANOI REGIONAL WATER PROJECT
    ------------------------------------------------------------------------
                                                                     2020
                       Statistic                    1990 Census   Projected
    ------------------------------------------------------------------------
    Kickapoo R. Population........................          477        1,490
    Counties Population...........................       90,198       89,462
    Median Age:
        Kickapoo..................................         25.5  ...........
        Kansas....................................         36.7  ...........
    Kickapoo School Enrollment:
        Pre-Primary...............................           23  ...........
        Elementary or High........................           80  ...........
        College...................................           15  ...........
                                                   -------------------------
          Total...................................          118  ...........
    Housing:
        Housing Units.............................          139          527
        Persons per House.........................         3.44         2.83
                                                   -------------------------
                                                       Kickapoo       Kansas
                                                   -------------------------
    1990 Household Income.........................      $14,464      $27,291
    1990 Family Income............................      $16,250      $32,966
    1990 Per Capita Income........................       $4,831      $13,300
    Percent Families Below Poverty Level..........         31.3          8.3
    1990 Labor Force..............................          126      765,003
    Unemployed....................................           18       13,419
    Percent in Labor Force........................         34.2         48.7
    Percent Unemployed............................         14.3          3.6
    ------------------------------------------------------------------------

                                                                       Value
    Average Annual Water Availability, af:
        Missouri River Streamflows, Rulo, af/year...........      29,701,000
        Big Blue River Near Mahattan, af/year, Tuttle.......       1,664,232
        Delaware River Valley Falls, ay/year, Perry.........         280,785
        Groundwater.........................................    Good to Poor
    2,020 Design Needs, gallons per capita per average day:
        In-Residence........................................              81
        Water Conservation..................................             -12
        Lawns and Gardens...................................              66
        School Enrollment...................................             3.0
        Labor Force.........................................             3.0
        Commercial and Industrial...........................             8.0
        System Losses.......................................              22
                        --------------------------------------------------------
                        ____________________________________________________
          Total.............................................             171
    2,020 Design Needs, Kickapoo and Region:
        Average Day, gallons................................       4,479,755
        Maximum Day, gallons................................      11,602,565
        Maximum Day, gpm....................................           9,669
        Annual, af..........................................           5,086

                               CONSTRUCTION COSTS
                                [In 1998 dollars]
    ------------------------------------------------------------------------
                                              Missouri Alt A    Perry Alt C
    ------------------------------------------------------------------------
    Intake..................................      $4,000,000      $4,000,000
    Treatment Plant.........................      13,978,000      13,978,000
    Pipelines...............................      49,394,000      49,519,000
    Pumping Stations........................       8,203,000      10,090,000
    Meters..................................         686,000         686,000
    Reservoirs..............................       3,875,000       3,875,000
    SCADA...................................       3,000,000       3,000,000
    O and M Building........................       1,500,000       1,500,000
    O and M Equipment.......................       1,500,000       1,500,000
    Easements...............................         321,000         315,000
    Mitigation..............................         500,000         500,000
    Non-Contract............................      35,123,000      35,933,000
    Cost Indexing to fiscal year 1996 to           5,471,000       5,598,000
     1998...................................
                                             -------------------------------
          Total.............................     127,551,000     130,494,000
    ------------------------------------------------------------------------

        TABLE 1-1.--STATISTICAL SUMMARY PIKITANOI REGIONAL WATER PROJECT
    ------------------------------------------------------------------------
                    Statistic
    ------------------------------------------------------------------------
    Pipelines, feet:
        24 inch diameter....................          34,975         236,167
        20 inch diameter....................         294,228          93,203
        18 inch diameter....................          47,234  ..............
        16 inch diameter....................          52,619          52,618
        14 inch diameter....................  ..............          15,615
        12 inch diameter....................         489,510         493,887
        10 inch diameter....................         147,369         150,407
         8 inch diameter....................         172,773         283,661
         6 inch diameter....................          66,607          17,120
         4 inch diameter....................         229,042         195,196
         2 inch diameter....................          71,520          37,267
                                             -------------------------------
          Total.............................       1,605,877       1,575,141
          Miles.............................           304.1           298.3
    Pumping Stations:
        Number..............................              15              16
        Maximum Horsepower..................           1,300           1,350
    ------------------------------------------------------------------------

                                     ______

      Prepared Statement of the Upper Mississippi River Basin Association

                              [Millions of dollars]
    ------------------------------------------------------------------------
                                                President's        UMRBA
                                                  Request     Recommendation
    ------------------------------------------------------------------------
    Construction General:
        Upper Mississippi River System                18.955          19.455
         Environmental Management Pro-  gram
        Major Rehabilitation of Locks and             19.392          21.392
         Dams...............................
    Operation and Maintenance: O&M of the            142.459         157.459
     UMR Navigation System..................
    General Investigations:
        Upper Mississippi and Illinois                   6.7             6.7
         Navigation Study...................
        Upper Mississippi River System Flow              2.1             2.1
         Frequency Study....................
        Land Management System (Research &         3 (of 27)       3 (of 27)
         Development).......................
    ------------------------------------------------------------------------

                                   background
        The Upper Mississippi River Basin Association (UMRBA) is the
    organization created 18 years ago by the Governors of the states of
    Illinois, Iowa, Minnesota, Missouri, and Wisconsin to serve as a forum
    for coordinating river-related state programs and policies and for
    collaborating with federal agencies on regional issues. As such, the
    UMRBA works closely with the Corps of Engineers on a variety of
    programs for which they have responsibility. Of particular interest to
    the basin states are the following Corps programs:
                        environmental management program
        The Upper Mississippi River System Environmental Management Program
    (EMP) was authorized in the 1986 Water Resources Development Act in
    response to the need for both restoring lost and degraded habitat and
    improving scientific understanding of the river system. What was at
    first a novel approach to interagency environmental management, has now
    become a widely recognized and respected regional program.
        The EMP consists of two primary components: the construction of
    individual projects to rehabilitate or enhance critical habitat areas
    and a long term monitoring program to track the environmental health of
    the system. The habitat projects, which vary in size and range in cost
    from about $200,000 to over $10 million, employ different types of
    techniques, including such measures as island creation, water level
    control features, side channel closures or openings, and selective
    dredging to remove sediment. The long term monitoring program uses six
    field stations throughout the river system which routinely collect
    standardized data on water, sediment, fish, and vegetation at over 150
    sites. In addition, the monitoring program headquarters at the Upper
    Midwest Environmental Sciences Center is home to a multi-disciplinary
    team of scientists who are interpreting and displaying the data in ways
    that will be useful for management decisions.
        The unique character of the EMP is, in part, a function of its
    partnership design. While the Corps of Engineers is the lead agency,
    the U.S. Fish and Wildlife Service, U.S. Geological Survey, and five
    basin states all have specific roles to play in planning, designing,
    evaluating, and operating and maintaining the habitat projects, as well
    as conducting the data collection and analysis that is part of the long
    term monitoring program.
        Fiscal year 2000 marks the fourth year in a row that the
    President's budget request includes less than the full authorized
    funding of $19.455 million for the EMP. Last year, the Administration
    recommended $18.355 million and Congress increased the funding level to
    $18.9 million. Although the Administration's request is higher this
    year ($18.955 million), it still falls $500,000 short of full funding.
    The five basin states are hopeful that Congress will again affirm its
    support for this important program by providing full funding for the
    EMP in fiscal year 2000.
        Funding shortfalls are of concern to the basin states for the
    following reasons:
      --The Congress is currently considering reauthorizing the EMP as part
            of the 1999 Water Resources Development Act. The proposals
            under consideration vary with regard to some provisions, but
            all include an increase in the annual authorized funding level
            to approximately $33 million. It would be particularly
            unfortunate and ironic if the EMP were to face funding cutbacks
            at the same time that Congress is poised to authorize future
            funding increases. If the program is weakened by insufficient
            funding in fiscal year 2000, it will be difficult to rebuild
            the program to the enhanced levels envisioned by Congress in
            pending reauthorization bills.
      --Unlike most other Corps projects, the EMP is currently ``capped''
            by its Congressional authorization both in terms of annual
            appropriations and overall time frame. Therefore annual funding
            decisions have a far greater impact on whether the program is
            ultimately able to accomplish its goals. No other Corps program
            or project of which we are aware is constrained by this unique
            combination of time and financial limitations.
        Funding shortfalls in the early years of EMP (FY 1988-91) and in
            more recent years (FY 1997-1999) total nearly $37 million below
            authorized levels. The annual cap on appropriations makes it
            impossible to ``recapture'' this shortfall.
      --Unless and until the EMP is reauthorized, funding shortfalls in the
            closing few years of the current EMP authorization period will
            have a particularly debilitating effect on the program. Some
            habitat projects for which planning and design have been
            initiated will not be able to proceed to construction, thus
            negating the investment which has already been made in these
            projects. The fiscal year 2000 budget will support the
            continuing construction of 7 projects, the completion of 5
            projects, and continuing planning and design work on 16
            projects. A number of these projects have already been delayed
            due to funding constraints. Unless the program is reauthorized,
            some of these projects may need to be abandoned entirely if
            sufficient funds are not provided prior to expiration of the
            authorization in 2002.
      --The success of the Long Term Resource Monitoring (LTRM) component
            of the EMP is dependent, in part, upon relatively reliable and
            constant funding levels. As a non-construction element of the
            EMP which supports teams of scientific and field personnel, the
            LTRM is particularly sensitive to annual funding variances. In
            this regard, the LTRM is unique within the Corps' construction
            general account, where there is typically more flexibility to
            respond to annual budgetary fluctuations.
        Efforts are underway to restructure the monitoring program so that
            it will be more flexible and effectively positioned to
            accommodate the future data and information needs in the
            ``second generation'' EMP. During this difficult transition
            period, it will be particularly important to provide a minimum,
            stable funding level for the LTRM, which has already suffered
            from the effects of inflation on its fixed appropriations
            authorization.
      --The economic and ecological health of the Upper Mississippi River
            are inexorably linked. Congress recognized this fact when, in
            1986, it declared this river system to be ``a nationally
            significant ecosystem and a nationally significant commercial
            navigation system.'' Yet EMP funding cuts in the past few years
            are widening the already large discrepancy between federal
            investment in these two major river purposes. In fiscal year
            2000, the Corps of Engineers will invest over $140 million in
            operation and maintenance of the Upper Mississippi River System
            for commercial navigation purposes. Another $20 million is
            scheduled for major rehabilitation of aging locks and dams.
            Though some of these investments have incidental environmental
            benefits, full funding ($19.455 million) for the EMP is
            critical if the federal commitment to multi-purpose management
            is to be maintained.
                     major rehabilitation of locks and dams
        Given that most of the locks and dams on the Upper Mississippi
    River System are over 60 years old, they are in serious need of repair
    and rehabilitation. For the past 13 years, the Corps has been
    undertaking major rehabilitation of individual facilities throughout
    the system in an effort to extend their useful life.
        The UMRBA supports the Corps' fiscal year 2000 budget request of
    approximately $19.4 million for major rehabilitation work at 5 locks
    and dams on the Upper Mississippi River. Half of this amount is to be
    provided by the Inland Waterways Trust Fund and will support work at
    Locks and Dams 3, 12, 14, 24, and 25. These funds will be used for lock
    rehabilitation, auxiliary lock closure rehabilitation, miter gate
    installation, electrical and mechanical rehabilitation, scour
    protection, rehabilitation of embankment systems that are subject to
    overtopping during flood events, and work on outdraft bendway weirs and
    wall openings. An additional $2,000,000 could be used in fiscal year
    2000 to advance completion of work on embankment systems vital to
    navigation and environmental interests.
      operation and maintenance of the upper mississippi river navigation
                                     system
        The Corps of Engineers is responsible for operating and maintaining
    the Upper Mississippi River for navigation. This includes channel
    maintenance dredging, placement and repair of channel training
    structures, water level regulation, and the daily operation of 29 locks
    and dams on the Mississippi River and 7 locks and dams on the Illinois
    River. The fiscal year 2000 budget includes slightly over $142 million
    for O&M of this river system, including $103.5 million for the
    Mississippi River between Minneapolis and the Missouri River, $13.5
    million for the Mississippi River between the Missouri River and Ohio
    River, and $25.4 million for the Illinois Waterway.
        These funds are critical to the Corps' ability to maintain a safe
    and reliable commercial navigation system. The efficiency of this
    system is vital to the agricultural economy of the five states. In
    addition, these funds support a variety of activities that ensure the
    navigation system is maintained while protecting and enhancing the
    river's environmental values. For example, O&M funds support innovative
    environmental engineering techniques in the open river reaches such as
    bendway weirs, chevrons, and notched dikes that maintain the navigation
    channel in an environmentally sensitive manner. In addition, studies of
    water level management options in a number of pools in the impounded
    portion of the river are underway as part of the on-going navigation
    O&M program. Pool level management is a promising new approach for
    enhancing aquatic plant growth and overwintering conditions for fish
    without adversely affecting navigation.
        While the funds that the Corps has requested for fiscal year 2000
    are expected to be adequate to meet basic O&M requirements, the UMRBA
    supports additional funding of $15 million which could be effectively
    utilized in fiscal year 2000 for critical needs such as electrical
    repairs, bulkhead repairs, repairs to cracks and spalls on lockwalls,
    concrete repairs, repairs to liftgates, revetment and dike repairs, and
    replacement of roller gate chains at various lock locations on the
    upper river.
                                navigation study
        In 1993 the Corps of Engineers initiated a feasibility study of
    navigation capacity expansion on the Upper Mississippi River and
    Illinois Waterway, a transportation system that is vitally important to
    the Midwest and the nation in linking agricultural commodities to
    international markets. The states in the region have been providing
    advice and counsel to the Corps throughout the study via a special
    Governors Liaison Committee comprised of gubernatorial appointees from
    each of the five basin states. The results of this study will be
    critical to our ability to make reasoned decisions about the future of
    the Upper Mississippi navigation system. Given that the merits of
    future multi-billion dollar federal investments will be judged based
    upon this study, the states of the basin are keenly interested in both
    the analysis and the alternatives under consideration.
        During the past year, the study experienced delays associated with
    the need to more carefully review and verify the economic models and
    some of the model inputs including traffic projections and demand
    curves. As a result, the study completion date has been postponed by
    one year to December 2000. Thus, much of the work necessary to bring
    the study to a close will now be done in fiscal year 2000.
        The five basin states support the President's request for $6.7
    million in fiscal year 2000 for the navigation study. Those funds will
    be used to continue the feasibility study, complete the plan
    formulation process, complete the draft feasibility report and draft
    Environmental Impact Statement, conduct internal and public review,
    hold public meetings, and complete a site-specific report with a
    baseline cost estimate. It is essential that the Corps has sufficient
    funds to complete these important tasks and produce a sound economic
    and environmental assessment of navigation capacity expansion needs.
              upper mississippi river system flow frequency study
        Flow frequencies for the Upper Mississippi River System badly need
    revision. The flood profiles currently in use were developed in 1979 by
    an interagency task force and replaced profiles previously adopted in
    1966. A variety of factors suggests that the 1979 profiles need to be
    updated:
      --The 1979 flood profiles are generally lower than the earlier 1966
            profiles. In the southern reaches of the Rock Island District,
            the difference is as much as five feet. For example, the 1979
            flood frequencies show that in the short time frame of 29
            years, a ``100 year'' flood, a ``200 year'' flood, and a ``500
            year'' flood have occurred in the city of Hannibal, Missouri.
            This has caused many communities along the Upper Mississippi
            River to question whether the 1979 methodology and resulting
            profiles are accurate.
      --There are now nearly 20 years of additional data available,
            including flow records from several high water events including
            the Great Flood of 1993. In addition, new methodologies have
            enhanced the Corps' ability to model the complex hydraulics of
            the Upper Mississippi River. In particular, following the 1993
            floods, the Corps developed a new mathematical hydraulic model
            (UNET) to answer ``what if'' questions such as the impact of
            levee failures or reservoir operations on stages of the
            Mississippi River. That model is now essentially complete and
            will enhance computation of water surface profiles.
      --Flood elevation profiles have a variety of uses including flood
            insurance; floodplain management; and the study, design, and
            construction of flood control projects. The need for updated
            math models and flood profiles has been widely recognized,
            especially since the Great Flood of 1993. The ``Galloway
            Report,'' which the Clinton Administration commissioned
            following the 1993 Midwest floods, recommended that the
            methodology used for flow-frequency analysis be reassessed.
            Similarly, the Flood Plain Management Assessment published by
            the Corps in June 1995 recommended that hydrology and
            hydraulics data be updated, including water surface profiles.
            The five states of the Upper Mississippi River Basin have been
            strong supporters of these recommendations.
        The UMRBA supports the Corps' fiscal year 2000 budget request of
    $2.1 million for the Flow Frequency Study. These funds will be used for
    UNET modeling and initiating work on generating flood profiles.
                             land management system
        The Corps of Engineers' Research and Development (R&D) budget for
    fiscal year 2000 includes $27 million, $3 million of which it is hoped
    will be used to support development of a Land Management System (LMS)
    demonstration project on the Upper Mississippi River System. Despite
    the fact that the LMS project could have utilized $4 million this year,
    only $800,000 has been made available in fiscal year 1999 for the
    demonstration sites on the Upper Mississippi River System.
        The basin states support the LMS initiative, which is designed to
    meet the increasing need for integrated approaches to natural resources
    management. In particular, LMS will rely heavily on modeling tools that
    can assess cumulative effects and forecast future conditions in a
    quantitative framework. We are fortunate in the Upper Mississippi River
    Basin to be chosen for the initial demonstration of these techniques.
    The Waterways Experiment Station (WES) in Vicksburg, Mississippi is
    leading the effort, which focuses on three specific locations in the
    basin: Peoria Lake on the Illinois River, the Minnesota River, and Pool
    8 on the Mississippi River. Problems such as backwater filling, poor
    water quality, and habitat loss are common to all these locations and
    are related to sediment transport and deposition. Evaluation of the
    ecological consequences of hydrologic and sediment dynamics at these
    sites within the Upper Mississippi River System will enhance LMS
    applications to other large river systems.
                                     ______

       Prepared Statement of Dr. Sam M. Hunter, President, Little River
                               Drainage District
        My name is Dr. Sam Hunter, DVM of Sikeston, Missouri. I am a
    veterinarian, landowner, farmer, and resident of Southeast Missouri.
        I am the President of the Little River Drainage District, the
    largest such entity in the nation. Our District serves as an outlet
    drainage and flood control District to parts of seven (7) counties in
    Southeast Missouri. We provide flood control protection to a sizable
    area of Northeast Arkansas as well. Our District is solely tax
    supported by more than 3,500 private landowners in Southeast Missouri.
        Our District as well as other Drainage and Levee Districts in
    Missouri and Arkansas is located within the St. Francis River Basin.
    This is a project item of the Mississippi River and Tributaries
    Project.
        The St. Francis Basin Project was authorized by Congress in 1928
    for improvements by the U. S. Army Corps of Engineers. The initial
    authorization was justified by a projected benefit cost ratio of 2.4:1.
    Today this ratio is 3.6:1 and the project is only 91 percent completed.
    As you can see this has been a wise investment of our federal tax
    dollars. Few projects or ventures with funding levels provided by the
    Federal Government return more than they cost. This one does and we
    need to complete it in a timely fashion.
        Local interests have done their part in providing rights of way,
    roads, utilities and the like. Our government now needs to fulfill
    their part of the project and bring it to completion as quickly as
    possible.
        The St. Francis Basin project has had a base funding level of
    approximately $10,000,000 over the past several years. Our last five
    (5) year average has been $9.9 million. That baseline funding level
    does not need to be diminished. The President's budget request of
    $4,350,000 is not acceptable. The amount requested by OMB will not
    provide sufficient funding levels for the Corps to maintain what they
    have built and/or improved. If these funding figures are accepted and
    not increased to $10,000,000 for fiscal year 2000 and succeeding years
    then we have digressed and not progressed.
        Since the initiation of the project for improvements we have seen
    many positive changes occur such as:
        (1) Many miles of all weather roads have been constructed and are
    usable almost daily each year.
        (2) Better flood control and drainage.
        (3) Development of one of the most fertile and diversified valleys
    in the world.
        (4) Growth of towns, schools, churches, industry, commerce, and
    etc.
        (5) Improvement of our environment: malaria, typhoid and other such
    diseases are no longer the norm but the rarity.
        (6) A future for our young people to have a desire to remain in the
    area.
        (7) Production of a variety of food and fiber products.
        As you can see many changes have occurred and we who live there
    welcome them fully. We, local interests, in Southeast Missouri and
    Northeast Arkansas want this project brought to completion and
    adequately maintained. We have waited over seventy (70) years and we
    believe it is now time to complete a wise investment for our nation.
        Our request to you today is to approve funding for the St. Francis
    Basin at $10,000,000 for fiscal year 2000 and succeeding years to
    ensure completion of the project.
        Further, we are here as a member of the Mississippi Valley Flood
    Control Association which represents similar interests as our District
    from the Gulf of Mexico upstream to the headwaters of the Mississippi
    River.
        The MR&T Project has only $280,000,000 in the President's budget.
    The Corps of Engineers has the capability of $355,000,000 and the need
    for a minimum of $335,000,000. We ask you to give consideration to
    provide funding levels at $335,000,000 for this project for fiscal year
    2000. This will provide some new construction but it will also provide
    the necessary maintenance monies needed each year.
        Thank you very much for your kind attention and the favorable way
    this committee has responded to our needs in the past.
       condensed information of the little river drainage district, st.
                     francis basin project and mr&t project
    Little River Drainage District
        (1) Circuit Court Drainage District of Missouri.
        (2) Serves parts of seven (7) counties.
        (3) Fully funded by special tax on landowners within Little River
    Drainage District.
        (4) Provides flood control and drainage to more than 3500 private
    landowners.
        (5) Located within St. Francis Basin.
        (6) Large, diversified, and highly productive area for food and
    fiber.
        (7) Has functioned since 1907.
        (8) Major contributor to St. Francis Basin (1,200,000 acres of
    runoff annually).
        (9) Member of Mississippi Valley Flood Control Association.
    St. Francis Basin Project
        (1) Authorized in 1928.
        (2) Justified with 2.4:1 benefit-cost ratio.
        (3) Presently providing a 3.6:1 benefit-cost ratio.
        (4) Needs a minimum annual funding of $10 million.
        (5) President's budget is $4,350,000. (This is simply inadequate to
    maintain prior constructed features and initiate any new authorized
    work).
        (6) Project has baseline funding of $9.9 million annually for past
    several years.
        (7) Local interest wants and needs this project completed. We have
    waited over seventy (70) years.
        (8) Project 91 percent completed.
        (9) Now projected for completion in 2007.
    Mississippi River and Tributaries Project
        (1) Authorized in 1928. Protects 30,000 square miles at times.
    Protects 20,550 square miles at all times.
        (2) Congress viewed project as a national problem at time of
    authorization.
        (3) Mississippi River drains forty-three percent (43 percent) of
    Continental United States and some of Canada.
        (4) Mississippi River is vital to production of food, industry,
    commerce, transportation, our nations defense, environment, health,
    etc.
        (5) Annual funding levels of $335,000,000 needed to maintain and
    continue construction.
        (6) President's fiscal year 2000 budget amount of $280,000,000 is
    inadequate.
        (7) Project is now 57 percent completed. (Fiscally).
            (a) Authorized levees are 92 percent completed. Projected year
                to complete is 2009.
            (b) Authorized channels are 93 percent completed.
        (8) Local interest wants and needs this project completed. We have
    waited over seventy (70) years.
        (9) Corps has capability of $355,000,000.
        (10) Finished portion yielding 7.9:1 benefit-cost ratio.
        (11) Unfinished portion projected to yield 36:1 benefit-cost ratio.
        (12) Entire project when completed will yield 20:1 benefit-cost
    return.
        (13) Project projected for completion in 2031.
                                     ______

        Prepared Statement of James S. Anderson, President, Blue Valley
                                  Association
        The Blue Valley Association has represented businesses and the
    community in the Blue River valley since 1920. One of the major
    concerns of the association throughout its existence has been flooding
    in the valley.
        In order to provide some relief to the area, the Big Blue River
    Rechannalization Project was approved by Congress in 1970. Construction
    on the project began in 1983 and was scheduled for completion in 1998.
    The project was to be constructed in three stages. Stages 1 and 2 are
    complete. Construction on Stage 3 began in 1997. Our understanding is
    that the project is now targeted to be completed by 2003, provided the
    requested funding is approved. Reduced funding would continue to delay
    the project by an additional three to five years.
        The progress that has been made to date has provided environmental
    cleanup, new jobs in the community, and flood relief to the landowners
    in the lower portions of the Blue River Valley. Several of our members
    have reported lower river stages after recent heavy rains.
        However, there is much work remaining to be done before the project
    is complete. We are concerned that the potential for flooding is still
    a serious threat to the properties upstream from the completed channel
    improvements. In addition, we are concerned that upstream development
    along the Blue River and its tributaries may actually increase the risk
    of flooding in some areas. If continued improvements upstream increase
    the threat, then obviously it is important to complete this project at
    the earliest date possible.
        For these reasons, we ask your consideration in approving funding
    for the projects and appropriations listed on the attached sheet for
    the fiscal year 2000 budget.

                    Requested Fiscal Year 2000 Appropriation

    Blue River Channel, Kansas City Missouri:Continued
        Construction of Stage 3. Completion--2003...........     $25,000,000
    Turkey Creek, Kansas City Kansas and Missouri: Complete
        design for construction start.......................         300,000
    Missouri River Levee System:
        Restudy Seven Levees--Begin feasibility study.......         350,000
        Unit L-385--Complete revised plans. ROW being
          acquired. Unit L-142--Complete design for new
          start.............................................         550,000
    Upper Blue River, Kansas and Missouri: Complete Final
        Plans and Specifications this year for construction
        in 2000. ROW to be acquired in 1999.................         500,000
    Swope Park Industrial Area, Kansas City, Missouri:
        Complete feasibility study..........................          60,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total.............................................      26,900,000
                                     ______

     Prepared Statement of J. M. Peterson, President, and Darrel G. Curry,
      Vice President of the Missouri River Bank Stabilization Association
        The Missouri River Bank Stabilization Association, its members and
    its officers thank you for the opportunity to present this statement
    and request relating to the budget for fiscal year 2000.
        This statement and the request contained herein relate to the
    Missouri National Recreational River project which was authorized by
    the Congress in 1978 per Section 707 of Public Law 95-625. The
    Association's request for fiscal year 2000 is $250,000.00 for operation
    and maintenance of structures built prior to 1978 pursuant to Section
    32 of the Streambank Erosion Control and Demonstration Act. Additional
    funding is needed for:
        1. Providing for replacement of flood-destroyed facilities which
    afforded access to the river in the project's lower reaches;
        2. The acquisition of shoreline easements to increase wildlife
    habitat and to improve and restore the scenic characteristics of the
    river;
        3. Provide streambank protection where and as needed;
        4. Meet such other needs as may be required to achieve the
    completion of the project.
        This project seeks to preserve and protect the fifty-nine mile
    segment of the Missouri River extending downstream from near Yankton,
    South Dakota, circa mile 811, to the Ponca State Park, circa mile 752,
    near Ponca, Nebraska. This reach of river is the only portion of the
    Missouri lying downstream of the ``main stem'' dams which is still in a
    relatively natural state. Here, the river is neither channelized nor
    are its banks protected by other than isolated stabilization
    structures. The entire shoreline is under relentless attack by the
    voracious Missouri, including even those areas which have been afforded
    some degree of bank protection. Three years of much higher than normal
    flows have wrought havoc along this reach of river. Erosion is, of
    course, a natural process; indeed, the Missouri is notorious for its
    appetite for its shoreline. The problem here, however, is that in this
    reach of the river the ``main stem'' dams have eliminated the annual
    flooding which once characterized the river. Thus, while the erosion
    continues, there is no offset in the nature of the natural and historic
    ``build-back'' (accretion) from flooding. To exacerbate the problem,
    the water discharged from the dam near Yankton is relatively free of
    sediment. Thus, it has a greater capacity to erode the downstream
    shorelines than did the muddy waters of old. The cleaner water can
    carry a greater sediment load, and it continues to utilize this
    increased capacity to the fullest. Evidence of the increased erosion is
    documented by Corps of Engineers' reports that this reach of river is
    over sixty percent wider now than when Gavins Point Dam, near Yankton,
    was completed in the mid-fifties.
        While $21 million was authorized for this project, only some $2
    million has been spent. The original management plan, will soon be
    supplanted by a new management plan developed by the National Park
    Service and Corps of Engineers. The proposed plan details a number of
    desirable proposals for a variety of efforts designed not only to
    increase public knowledge, accessibility and enjoyment of this historic
    reach of the Missouri, but to preserve and protect those
    characteristics which constitute its identity. Those very
    characteristics made it worthy of its designation as a Recreational
    River under the Wild and Scenic Rivers Act.
        A significant factor underlying this request is the impending
    national celebration of the bicentennial of the Lewis and Clark
    Expedition. Interest in this momentous event is accelerating
    dramatically, and one of the focal points of that interest is this
    segment of the Missouri. As the only remnant of a relatively natural
    river lying downstream of the Missouri's dams, it affords a dramatic
    glimpse of the Missouri which faced the Corps Discovery. Improved
    access, signage, preservation of extant timber, islands, bars and
    wildlife habitat will help ensure the continued existence of the
    characteristics which impelled the Congress to include in the Wild and
    Scenic Rivers Act, this unique segment of the Missouri.
        The Association is truly appreciative of the previous support and
    assistance the Congress has provided, and we thank you for that on-
    going concern. Joining in our extension of thanks are the numerous
    individual outdoorsmen, landowners, hunters, fishermen,
    environmentalists and others who love, respect and enjoy this national
    treasure and wish to preserve and protect it. Again, our thanks!
                                     ______

                          UPPER MIDWEST WATER PROJECTS
        Prepared Statement of Norman Haak, Chairman, Garrison Diversion
                              Conservancy District
        Chairman Domenici and Honorable Members of the Subcommittee: On
    behalf of the Garrison Diversion Conservancy District Board of
    Directors, thank you for your past support of the Garrison Diversion
    Project. Previous Garrison Diversion Unit appropriations have been used
    to deliver reliable, high quality water supplies to residents in rural
    communities across North Dakota, along with maintenance of 120 miles of
    canals and pumping plants already constructed across the state.
        The Garrison Diversion Project continues to be the backbone of all
    water projects in North Dakota. Completing Garrison Diversion will
    assure our citizens affordable access to an adequate quantity and
    quality water supply for municipal, rural and industrial systems.
    Garrison Diversion is the key for future economic development,
    recreation, tourism and wildlife enhancement in our state.
        This year's budget includes $24.5 million for the Garrison
    Diversion Unit. Additional appropriations will continue development of
    rural water supply systems across the state, providing a dependable
    water supply to North Dakota residents, who now in many cases are
    hauling water due to inadequate supplies. The funding received, or not
    received, impacts the lives of families and business owners across the
    state who are working toward finding solutions to meet their water
    needs.
        Meeting the Indian MR&I needs also concerns North Dakotans.
    Existing ceilings are exhausted and the unmet needs on the reservations
    are growing. Additional appropriations and an appropriate ceiling will
    allow tribal leaders to continue working on their most critical water
    needs.
        A greater concern is the overall Bureau of Reclamation budget.
    Current trends show this budget number shrinking on an annual basis.
    Although the president's current budget request is an increase over
    last year's appropriation, additional funding is definitely needed. The
    Bureau budget needs to reflect a greater commitment to completing
    currently authorized water projects. Although water conservation, water
    reuse and restoring fish and wildlife resources are important, the
    Bureau's budget needs to be refocused and increased to place more
    emphasis on completing the authorized projects already on the books.
        To this end, we fully expect the Dakota Water Resources Act to be
    reintroduced in the very near future. This bill reduces the cost of the
    project currently authorized and directs the funding to meet the
    highest priority needs of the state. The state, under the terms of this
    bill, will repay, with interest, major portions of the costs while
    matching federal dollars with substantial nonfederal dollars in other
    areas.
        Mr. Chairman, North Dakotans from cities, farms and businesses are
    committed to the Garrison Diversion Project. Although the project will
    never be built as originally planned in 1944, it is still the most
    important water project in our state. I want to thank your committee
    for past support, and it is my hope your support will continue for this
    fiscal year.
                                     ______

     Prepared Statement of Kurt Pfeifle, General Manager, Mid-Dakota Rural
                       Water Project (Public Law 102-575)
                        fiscal year 2000 funding request
        First let me thank the Subcommittee for the opportunity to testify
    in support of the fiscal year 2000 appropriations for the Mid-Dakota
    Rural Water Project and for the Subcommittee's support.
        The Mid-Dakota Project is requesting $28 million in federal
    appropriations for fiscal year 2000. This request anticipates $27
    million for Project construction and $1 million for the authorized
    ``wetland'' component. As with our past submissions to this
    subcommittee, Mid-Dakota's fiscal year 2000 request is based on a
    detailed analysis of our ability to proceed with construction during
    the fiscal year. In all previous years, Mid-Dakota has fully obligated
    its appropriated funds, including federal, state, and local, and could
    have obligated significantly more were they available.
        This year (FY 2000) the project is seeking additional funds above
    the President's budget recommendation in the amount of $23 million.
    Mid-Dakota understands and appreciates pressures on Congress to pass
    and maintain a balanced and seemingly an austere budget and in that
    respect we understand the difficulties before congressional
    appropriators to find additional funds to supplement the President's
    budget request. However, we request and strongly urge Congress to
    appropriate the full amount of Mid-Dakota's request.
                           history of project funding
        The Project was authorized by Congress and signed into law by
    President George W. Bush in October 1992. The federal authorization for
    the project totaled $100 million (1989 $s) in a combination of federal
    grant and loan funds (grant funds may not exceed 85 percent of federal
    contribution). The State authorization was for $8.4 million (1989 $s).
    The total authorized indexed cost of the project now stands at $142.163
    million. All federal funding considered, the Government has provided 43
    percent of its commitment (56.546 million of $132.493 million) to
    provide construction funding for the Project. In the 1998 Legislative
    session the South Dakota Legislature appropriated $1.3 million
    completing the State's authorized commitment to Mid-Dakota. When
    considering the federal and state combined awards, the project is
    approximately 47 percent complete, in terms of financial commitments.
        Mid-Dakota wishes to thank this committee for its support over the
    past six years. Within the limited monetary parameters of current
    federal awards and funds appropriated by the State of South Dakota, we
    have been able to put those scarce resources to good work, making
    exceptional progress on project construction, albeit not nearly as fast
    as is needed or as we had initially envisioned.

                                                                SUMMARIZATION OF FEDERAL FUNDING
                                                                          [In millions]
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                  Total fed.
                                                              Mid-      Pres.                              Conf.       Award Level    Additional     Funds
                       Fed. Fiscal Year                      Dakota     Budget     House      Senate      Enacted   (Underfinancing)     Funds     provided
                                                            Request                                       Levels         Applied                   Mid-Dak.
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    1994.................................................      7.991  .........  .........       2.000       2.000          1.500     ..........       1.500
    1995.................................................     22.367  .........  .........       8.000       4.000          3.600     ..........       3.600
    1996.................................................     23.394      2.500     12.500      10.500      11.500         10.902          2.323      13.225
    1997.................................................     29.686      2.500     11.500      12.500      10.000          9.400          1.500      10.900
    1998.................................................     29.836     10.000     12.000      13.000      13.000         12.221          1.000      13.221
    1999.................................................     32.150     10.000     10.000      20.000      15.000         14.100     ..........      14.100
    2000.................................................     28.800      5.000  .........  ..........  ..........  ................  ..........  ..........
                                                          --------------------------------------------------------------------------------------------------
          Totals.........................................  .........     30.000     46.000      66.000      55.500         51.723          4.823      56.546
    --------------------------------------------------------------------------------------------------------------------------------------------------------

        Additionally, the State of South Dakota has contributed $9.67
    million in grants to the Mid-Dakota Project, in previous years. The
    State of South Dakota completed its initial authorized financial
    obligation to the Mid-Dakota Project in the 1998 Legislative Session.
        The $15 million funding provided by the Subcommittee in fiscal year
    1999 provided Mid-Dakota with the opportunity to achieve very
    significant and exciting accomplishments for the fiscal year. These are
    later summarized in the section titled ``Construction in Progress.''
    Mid-Dakota will continue to deliver quality drinking water to five
    community systems and approximately 600 rural customers. Mid-Dakota
    estimates that an additional 550 rural customers along with six more
    community systems will be receiving project water at the close of
    contracts awarded in fiscal year 1999. The generosity of the
    subcommittee has already had a deep and favorable effect on the lives
    of nearly 10,000 South Dakotans.
                  president's fiscal year 2000 budget request
        In February the President's Budget recommendations to Congress were
    released. Mid-Dakota Rural Water was included in the proposed budget at
    a level of $5 million for fiscal year 2000. This represents a 50
    percent decrease in the President's funding recommendation and a 67
    percent decrease from what Congress appropriated in fiscal year 1999.
    It is the only time the President has lowered his recommendation from
    one year to the next. The Mid-Dakota Project will not be able to make
    any significant progress in fiscal year 2000 at this level of funding.
    In fact, it would not be an overstatement to say that Mid-Dakota may
    have to suspend construction activities for fiscal year 2000, if the $5
    million is not significantly increased.
        As in previous years, Mid-Dakota is in ``catch-up'' mode, due to
    lower than expected appropriations in prior years. The $28 million
    request for fiscal year 2000 will help the project maintain an
    acceptable construction schedule. The $5 million budget request by
    President Clinton would have profound and devastating effects, pushing
    the completion of the Project to the year 2015. Under the Clinton
    Administration's proposal, thousands of South Dakota citizens will be
    forced to wait an estimated 13 years until they can be connected to the
    Mid-Dakota Project. The President's budget, if ultimately implemented
    will provide an extended delay of Project benefits.
        The following table demonstrates the effect of the President's
    budget request for the Mid-Dakota Project as compared to other larger
    appropriation levels. The table also demonstrates the significant cost
    increases expected (using a conservative two-percent inflation
    (indexing) factor):

                           MID-DAKOTA RURAL WATER PROJECT COST AND TIMELINE TO COMPLETION \1\
                                                [In millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                                                                                                               Cost
                   Fiscal Year                00  01  02  03  04  05  06  07  08  09  10  11  12  13  14  15    to
                                                                                                              Finish
    ----------------------------------------------------------------------------------------------------------------
    Approp. $5..............................   5   5   5   5   5   5   5   5   5   5   5   5   5   5   5   3      78
    Approp. $10.............................  10  10  10  10  10  10  10   2  ..  ..  ..  ..  ..  ..  ..  ..      72
    Approp. $15.............................  15  15  15  15  10  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..      70
    Approp. $20.............................  20  20  20   9  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..      69
    Approp. $25.............................  28  25  15  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..  ..     68
    ----------------------------------------------------------------------------------------------------------------
    \1\ Data in table is based upon various leveled annual appropriations, an estimated $67.17 million authorized
      unappropriated federal funds and two-percent inflationary indexing.

        As is evident by the foregoing table, the President's budget
    recommendation will have an effect of significantly delaying water
    service to those who need it most.
        By its actions the Administration raises the potential of
    increasing the total cost of the Mid-Dakota Project by more than $10
    million. The federal government would not be alone in absorbing
    negative impacts of funding shortfalls. In addition to making the Mid-
    Dakota Project more expensive to the federal government, the resulting
    delays would also have a direct and proportional effect on the rate of
    debt service to be paid by the Project and ultimately the water users.
    The repayment agreement entered into by Mid-Dakota and the federal
    government (the Bureau of Reclamation acting on the Government's
    behalf), demands that Mid-Dakota's ``minimum bill'' increase
    proportionally with the indexing applied to the Project. This is done
    by establishing the ratio of the federal authorization at the time Mid-
    Dakota submitted its Final Engineering Report (FER) in 1994, compared
    to the authorized ceiling today with indexing applied. This same ratio
    is then applied to Mid-Dakota's ``minimum bill'' as was identified at
    the time of execution of the repayment agreement. The following table
    is offered as an example:

    Mid-Dakota's ``minimum bill'' rate at the time of signing the repayment
        agreement = $32.50
    Leveled annual appropriations of $5 million--estimated increase to
        minimum bill: 21 percent
    Leveled annual appropriations of $10 million--estimated increase to
        minimum bill: 16 percent
    Leveled annual appropriations of $15 million--estimated increase to
        minimum bill: 15 percent
    Leveled annual appropriations of $20 million--estimated increase to
        minimum bill: 14 percent
    Leveled annual appropriations of $25 million--estimated increase to
        minimum bill: 13 percent

        By the Bureau of Reclamation's own design, slowing down the
    development of the Mid-Dakota Project will ultimately make the Project
    more expensive, in terms of; rates paid by water users construction
    costs, total debt of the Project and Reclamation's oversight costs.
                                impacts of award
        The most obvious impact of any significant reduction from Mid-
    Dakota's request will be the delay of construction of one or more
    Project components. The $28 million dollar request will allow the
    Project to proceed with construction of multiple contracts summarized
    later in this testimony. An award of less than our request will result
    in the deletion or reconfiguration of one or more of these contracts
    from the fiscal year 2000 construction schedule. Further, reduced
    appropriations have the effect of adding more cost to the amount needed
    for completion of the Project.
        Mid-Dakota has consistently informed members of Congress and
    appropriate federal agencies, about the detrimental effects
    insufficient funding has on the Project and ultimately the people who
    are to receive the water. In previous years Mid-Dakota and the public,
    which we will serve, have been able to make the most of the resources
    provided the Project. However, failure to provide full funding has had
    profound consequences.
                            construction in progress
        Mid-Dakota began construction in September of 1994, with the
    construction of its Water Intake and Pump Station. Since that eventful
    day of first construction start, we have bid, awarded, and completed
    seven \2\ project components and are into construction on two other
    major Project components. The following table provides a synopsis of
    each major construction contract:
    ---------------------------------------------------------------------------
        \2\ Contract 4-1A/B (schedules 1-5) should be complete in May,
    1999.

    ----------------------------------------------------------------------------------------------------------------
                                                                                                            Percent
                                                             Cont.     Cont. Bid     Final       Over        over
                    Cont. No./Description                 budget \3\     Award       Cont.      (under)     (under)
                                                                                     Price      Budget      budget
    ----------------------------------------------------------------------------------------------------------------
    1-1, Oahe Water Intake and Pump Station.............       4.662       3.959       3.945     (0.717)        (15)
    2-1, Oahe Water Treatment Plant.....................      13.361       9.920      10.278     (3.083)        (23)
    3-1A, Raw Water Pipeline............................       1.352       1.738       1.719      0.367          27
    3-1B, Main Pipeline to Blunt, SD....................       7.823       6.916       7.024     (0.799)        (10)
    3-1C, Main Pipeline to Highmore, SD.................       5.439       4.791       4.798     (0.641)        (12)
    3-2A, Main Pipeline to Ree Hights, SD...............       3.261       3.155       3.155     (0.106)         (4)
    3-2B, Main Pipeline to St. Lawrence, SD.............       3.691       3.349       3.349     (0.342)         (9)
    4-1A/B (1-5), Rural Service Area Contract...........       9.169       9.983      10.601  \4\ 1.432          16
    5-1, Highmore Water Storage Tank....................       1.545       1.434       1.433     (0.108)         (7)
    5-1A, Onida Water Storage Tank......................       0.471       0.395       0.395     (0.075)        (16)
                                                         -----------------------------------------------------------
          Totals........................................      50.774      45.640      46.697     (4.077)         (8)
    ----------------------------------------------------------------------------------------------------------------
    \3\ Contract budget is determined by Mid-Dakota's estimate for the contract at the time of bidding.
    \4\ A significant portion of cost increases are attributable to the placement of additional users as
      construction proceeds.

        As is evident by the foregoing table, Mid-Dakota has been very
    successful in containing Project costs. Currently the construction of
    major Project components are approximately 8 percent under budget ,
    providing an estimated saving of over $4 million. The savings are an
    example of sound engineering, good management and advantageous bid
    lettings. While we can't guarantee future contract bid lettings will
    continue to provide the level of savings currently experienced, we do
    think it speaks well of the Mid-Dakota Project and how we've managed
    Project funding to date.
        Mid-Dakota also provided the solution to a number of emergency
    situations in fiscal year 1998. The ``rescue'' effort to the City of
    Gettysburg, SD provided the town with a dependable, quality water
    supply (Mid-Dakota) just as they were about to lose their existing
    water intake, due to sluffing of the hillside at that location. The
    town of Virgil, SD will have a new distribution system for the town,
    replacing the old one that was in disrepair and draining the town
    coffers to keep it running and supply drinking water to Virgil
    residents. Mid-Dakota has verbally agreed to take-over the operations
    of the Southern Spink and Northern Beadle Rural Water System (SSNB).
    SSNB is a small community water supply system that lacks the necessary
    resources to properly operate a potable water supply system. Mid-Dakota
    replaced approximately eight miles of pipeline along U.S. Highway 212.
    The Highway is scheduled for improvements in the Spring of 1999. A
    water pipeline located in the Highway right-of-way would have to be
    relocated increasing the cost of the Highway improvement. Mid-Dakota
    instead placed its pipeline (that would have been constructed in the
    future) out of the way of the Highway improvement. This lessened the
    cost of the Highway project and provided for an uninterrupted supply of
    water to people along the pipeline route.
              tentative fiscal year 2000 construction schedule \5\
    ---------------------------------------------------------------------------
        \5\ Project features listed in table are subject to rescheduling
    based upon funding provided and readiness to proceed and other factors.
    Actual construction activities, therefore, may not coincide exactly
    with schedule presented here.
    ---------------------------------------------------------------------------
        Mid-Dakota has developed an aggressive construction schedule for
    fiscal year 2000, with plans to install nearly 900 miles of pipeline to
    serve an estimated 3,250 more people than are currently receiving or
    scheduled to receive Project drinking water. Our construction schedule
    will also provide the necessary main pipeline infrastructure to move
    forward with many more rural and community connections in the future.
    Federal funding allocated in any given fiscal year is always the
    limiting factor that drives Mid-Dakota's construction schedule.

                     CONSTRUCTION SCHEDULE, FISCAL YEAR 2000
    ------------------------------------------------------------------------
                                                     Estimated    Estimated
                                        Estimated    number of    population
             Project Feature               Cost        meters       to be
                                                     connected      served
    ------------------------------------------------------------------------
    Gettysburg Service Area & Tower          1.500          300        1,600
     \6\.............................
    Highmore Central Service Area....        3.575          180          500
    Mac's Corner Service Area & Tower        3.210          110          350
    Rezac Lake Service Area & Tower..        2.767           60          175
    Collin's Slough Service Area &           1.958           60          175
     Tower...........................
    Cottonwood Lake Service Area &           3.203          155          450
     Tower...........................
    Main Pipeline to St. Lawrence, SD        2.187  ...........  ...........
     \6\.............................
    Administration...................         .460  ...........  ...........
    Engineering & Legal..............        2.116  ...........  ...........
    Inspection.......................        1.135  ...........  ...........
    Bureau of Reclamation oversight..         .460  ...........  ...........
    Other costs......................        2.760  ...........  ...........
    Wetland component................        1.000  ...........  ...........
                                      --------------------------------------
          Totals.....................   \7\ 26.331          865        3,250
    ------------------------------------------------------------------------
    \6\ Project components footnoted are part of fiscal year 1999
      construction schedule. Costs shown in the table are needed to complete
      construction of that particular component.
    \7\ Mid-Dakota's request of $28 million anticipates that 6 percent of
      any appropriation will be deemed unavailable by the Bureau of
      Reclamation by application of ``under-financing.'' This level of
      ``under-financing'' would effectively reduce a $28 million
      appropriation to $26.4 million.

                                    closing
        Mid-Dakota is intensely aware of the difficult funding decisions
    that face the Energy and Water Appropriations Subcommittee and we do
    not envy the difficult job that lies ahead. We strongly urge, the
    Subcommittee to look closely at the Mid-Dakota Project and recognize
    the dire need that exists. Consider the exceptionally high level of
    local and state support. And lastly our readiness, our credibility and
    our ability, to proceed.
        Again, we thank the Subcommittee for its strong support in the
    past.
                                     ______

                  Prepared Statement of the Mni Wiconi Project
                  fiscal year 2000 construction budget request
        The Mni Wiconi Project beneficiaries (as listed below) respectfully
    request appropriations for construction in fiscal year 2000 for the
    project in the amount of $34,144,000 as follows:

    Oglala Sioux Rural Water Supply System:
        Core Facilities (Treatment Plant, Pipelines)........     $11,895,000
        Distribution System on Pine Ridge...................       6,138,000
    West River/Lyman-Jones Rural Water Systems..............       9,916,000
    Rosebud Sioux Rural Water System........................       3,762,000
    Lower Brule Sioux Rural Water System....................       2,433,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total Mni Wiconi Project..........................      34,144,000

        The Oglala, Lower Brule and Rosebud Sioux Tribes were consulted as
    required by the Indian Self-Determination Act (Public Law 93-638, as
    amended) when the Administration arrived at its fiscal year 2000
    construction budget of $23.9 million for the Mni Wiconi Project. This
    budget, however, does not address the needs of the project in fiscal
    year 2000 or in fiscal year 2001, a major target year for the project.
        The principle element in the budget for fiscal year 2000 is $11.895
    million for the Oglala Sioux Rural Water Supply System (OSRWSS) core.
    The OSRWSS core system funds are needed to complete the project to
    Murdo by fiscal year 2001, where water can be delivered to the largest
    areas of demand in the West River/Lyman-Jones service area and all of
    the Rosebud service area. By completing the project to Murdo, all of
    the interconnection points for the Lower Brule Sioux Tribe will also be
    provided. Only the Pine Ridge Indian Reservation and parts of West
    River/Lyman-Jones will be without points of interconnection to the
    OSRWSS core. This landmark in progress on the project by the end of
    fiscal year 2001 is the most significant event in the project to date.
    The requested funding level is needed for the next two years to achieve
    the objective.
        Important to note is the fact that in fiscal year 1999 the intake
    and treatment plant on the Missouri River will be concluded. Completion
    of the OSRWSS core pipeline system to Murdo is necessary to utilize, to
    any significant degree, those completed facilities. Also, noteworthy is
    the fact that major segments, but not all segments, of the core
    pipeline will be completed in fiscal year 1999 between the treatment
    plant and Murdo. The funding request for fiscal year 2000 will continue
    the core pipeline construction, and the funding request in fiscal year
    2001 will permit us to conclude the necessary construction to Murdo,
    thereby providing interconnection to a population of 26,000, 50 percent
    of the project population. Absent sufficient funds in fiscal year 2000
    and fiscal year 2001, only 8,000 persons will be provided with
    interconnection to the OSRWSS core to receive water from the Missouri
    River.
        All proposed sponsor construction activity will build pipelines
    that will provide project water immediately to beneficiaries. In many
    cases, construction is ongoing, and fiscal year 2000 funds are required
    to complete those projects. In the absence of fiscal year 2000 funds
    requested for the distribution systems, it will be necessary to
    discontinue some on-going construction contracts and reinitiate them at
    a later time. This will raise project costs. It will also lower faith
    of contractors in the project, which will affect future bid prices.
        Funding for OSRWSS core and distribution facilities are necessary
    to bring the benefits of the Empowerment Zone designation to the Pine
    Ridge Indian Reservation, one of five rural designations across the
    Nation. There is great anticipation on the Pine Ridge Indian
    Reservation. The federal projection that as much as $.5 to $1.0 billion
    in economic activity can be generated, however, is largely dependent on
    the timely completion of a water system, which depends on
    appropriations for this project.
                          unique needs of this project
        Your consideration in this most important project, a project that
    brings hope, dignity and a spirit of cooperation between Indian and
    non-Indians, will be greatly appreciated. This subcommittee has
    provided us with considerable support for which we are grateful. This
    year the Administration has provided a decreased and inadequate budget.
    It is necessary for the project to petition the subcommittee for the
    appropriate level of funding to build the OSRWSS core to Murdo by year
    2001, a major accomplishment that will provide interconnections from
    the core system to nearly 50 percent of the project population or about
    26,000 persons.
        The possibility of a lower level of appropriations in fiscal year
    2000 would be hurtful. Each year our testimony addresses the fact that
    the project beneficiaries, particularly the three Indian Reservations,
    have the lowest income levels in the Nation. The health risks to our
    people drinking unsafe water are compounded by reductions in health
    programs. We respectfully submit that our project is unique and that no
    other project in the Nation has greater human needs. Poverty in our
    service areas is consistently deeper than elsewhere in the Nation.
    Health effects of water borne diseases are consistently more prevalent
    than elsewhere in the Nation, due in part to (1) lack of adequate water
    in the home and (2) poor water quality where water is available. Higher
    incidences of impetigo, gastroenteritis, shigellosis, scabies and
    hepatitis-A are well documented on the Indian reservations of the Mni
    Wiconi Project area. At the close of the 20th century one cannot find a
    region in which social and economic conditions are as deplorable. These
    circumstances are summarized in Table 1. Mni Wiconi builds the dignity
    of many, not only through improvement of drinking water, but through
    employment and increased earnings during planning, construction,
    operation and maintenance.

               TABLE 1.--1990 BUREAU OF CENSUS ECONOMIC STATISTICS
    ------------------------------------------------------------------------
                                                     Families
                                                      Below
        Indian Reservation/State       Per Capita    Poverty    Unemployment
                                         Income       Level       (percent)
                                                    (percent)
    ------------------------------------------------------------------------
    Pine Ridge (Shannon County).....       $3,029         59.6          32.7
    Rosebud (Todd County)...........        4,005         54.4          27.3
    Lower Brule (Lyman County)......        4,679         45.0          15.7
    State of South Dakota...........       10,661         11.6           4.2
    National........................       14,420         10.0           6.3
    ------------------------------------------------------------------------

        Financial support for the Indian membership has already been
    subjected to drastic cuts in funding programs through the Bureau of
    Indian Affairs and through Welfare Reform. This project, progressing
    through the budget fighting efforts at the National level, was a source
    of strong hope that would off-set the loss of employment and income in
    other programs and provide for a healthier environment. Tribal leaders
    anticipate that Welfare Reform legislation and other budget cuts
    nation-wide will create a crisis for tribal government when tribal
    members move back to the reservations in order to survive. This
    movement has already started. Recent Census Bureau data indicate that
    the population of Shannon County (Pine Ridge Indian Reservation)
    increased over 21 percent between 1990 and 1997. The population of Todd
    County (Rosebud Indian Reservation) has increased over 11 percent in
    the same time period. Those population increases are greater than
    anticipated and will create water needs that will more than utilize the
    benefits of the Mni Wiconi Project Act. Public policy has resulted in
    accelerated population growth on the reservations. The Act mandates
    that:

            . . . the United States has a trust responsibility to ensure
            that adequate and safe water supplies are available to meet the
            economic, environmental, water supply and public health needs
            of the Pine Ridge, Rosebud and Lower Brule Indian Reservations
            . . .

        Indian support for this project has not come easily because of the
    historical experience of broken commitments to the Indian people by the
    Federal Government. The argument was that there is no hope and the
    Sioux Tribes would be used to build the non-Indian segments of the
    project and the Indian segments would linger to completion. These
    arguments have been overcome by better planning, an amended
    authorization and hard fought agreements among the parties. The
    Subcommittee is respectfully requested to take the steps necessary the
    complete the critical elements of the project proposed for fiscal year
    2000.
        The following sections describe the construction activity in each
    of the rural water systems.
              oglala sioux rural water supply system--distribution
        Attachment A summarizes the status of the Oglala Sioux distribution
    system on the Pine Ridge Indian Reservation. All projects rely on
    groundwater. Pine Ridge and parts of West River will be the last
    project sponsors to interconnect with the OSRWSS core to receive
    Missouri River water. With projects now designed and proceeding under
    construction award there are 932 services and 402.2 miles of
    distribution and service pipelines, down from earlier projections due
    to the pace of funding. We continue to extent the start of new
    projects. Two projects were bid in 1998 and will require 2000 funds for
    continuation. The Manderson Loop has been under construction since
    fiscal year 1996, and the fifth of five phases will be scheduled for
    completed with fiscal year 2000 funds. The Red Shirt Project in the
    northwest corner of the Reservation will be started in fiscal year
    1999, and is scheduled for completion in fiscal year 2000. Parts of the
    project have been deferred due to shortage of funds and higher costs
    than anticipated on other project segments. Of special importance to
    the Oglala Sioux Tribe is the start of the main transmission system
    from the northeast corner of the Reservation to Kyle in the central
    part of the Reservation. This transmission line is needed to
    interconnect the OSRWSS core system with the distribution system within
    the Reservation in order to deliver Missouri River water to the
    populous portions of the Reservation. If adequate funds were available,
    this segment of the project would be initiated in fiscal year 2000.
    However, this critical component of the Oglala system has been deferred
    to later years.
            west river/lyman-jones rural water system--distribution
        Appropriations received by WR/LJ have been applied to five service
    area construction projects that now serve a significant percentage of
    our membership. A summary of project status, members services and miles
    of pipeline is provided in Attachment A. Construction funds obtained
    from the fiscal year 2000 appropriation will be used to construct those
    projects on which design is on going.
        WR/LJ priorities in fiscal year 2000 are for construction of
    distribution facilities that will receive project water delivered by
    OSRWSS and LB core pipeline and treatment projects now under
    construction and completed portions of the RST core pipeline. These
    projects will bring needed water to the Ft. Pierre area of Stanley
    County, rural users and the City of Presho in Lyman County and rural
    residents of eastern Mellette County.
        The project in eastern Mellette County is a joint undertaking with
    the RST. The water source is the RST core pipeline. Distribution
    pipeline constructed by WR/LJ will serve their membership and have
    capacity for and deliver water to RST tribal members. A similar project
    is now under construction to serve WR/LJ and RST members in western
    Mellette County.
                           rosebud rural water system
        Fiscal year 2000 is turning point for the Sicangu Mni Wiconi. The
    work proposed will build on the projects completed or initiated in 1998
    and 1999 and prepare for the OSRWSS reaching Murdo in 2001.
        The improvements to the community system at St. Francis initiated
    in 1999, will be used to distribute water to rural homes in the
    surrounding area. The rural distribution project will connect numerous
    additional rural residences to previously constructed distribution
    pipelines. The work planned in the Mission/Antelope area will further
    improve the reliability of the water supply to the area.
        Fiscal year 2000 will also be a year of preparation for the
    construction of the Rosebud core line to Murdo in fiscal year 2001.
    Pre-construction work in design and right-of-way acquisition is needed
    to insure timely and efficient construction of this major transmission
    pipeline in the following year. After the Rosebud core pipeline is
    constructed to White River, high quality water will be available for
    both Indian and non-Indians in Mellette County and Northern Todd County
    where the water is needed most.
                  lower brule rural water system--distribution
        The core system pipeline from West Brule to Reliance has been
    installed and tested, using the systems West Brule booster station,
    which has also been completed. The new water treatment plant is under
    construction, using a combination of funding from numerous sources.
    These include HUD/IHS, EPA, USDA-RD, Mni Wiconi/LBRWS, and Tribal. A
    second 300-gpm treatment unit has been ordered, giving the new plant
    two-microfiltration units with a total winter capacity of 600 gpm. Of
    the total $1,800,000 funding, $145,000 will come from tribal funds and
    the Rural Development funds are a $150,950 grant and a $145,238 loan,
    to be repaid from the rural water system operating revenues. The
    balance of the funds is all grant funds, with $250,000 of those funds
    anticipated to be Mni Wiconi/LBRWS funds. The second water treatment
    unit will allow LBRWS to provide water to their members in the
    communities of Lower Brule and West Brule, and until the Lower Brule
    core system is completed from Vivian to Reliance, services will be
    provided to West River/Lyman Jones Rural Water System for their members
    in the Reliance North, Reliance South and town of Reliance sub-systems.
    LBRWS also has under construction the reservoir located just North of
    Medicine Butte as a part of this West Brule to Reliance core system.
        Fiscal year 1999 funds will also be used, as set forth in that
    fiscal year budget, to construct the Fort George Butte/County Road core
    pipeline, and to design and construct a new administration building.
    The pipeline project will provide water to approximately twenty-four
    WR/LJ members along that route and, ultimately, to the LBRWS Fort
    George Butte distribution sub-system, although those sub-system funds
    have not been budgeted at this time.
        Budgeted fiscal year 1999 funds will also be used to complete
    design for the Vivian to Presho segment of the Vivian to Reliance to
    West Brule LBRWS core system.
        LBRWS requests fiscal year 2000 funding in the amount of
    $2,433,000. These funds will be used for the following projects:
        A. for purchase and installation of the second water treatment
    unit.
        B. for completion of the administration building.
        C. for construction, including related engineering services, for
    construction of the Vivian to Presho LBRWS core pipeline.
        As shown above, LBRWS is continuing its obligation to complete the
    basis core pipeline from Vivian to Reliance and from Kennebec North to
    the reservation boundary by the legislatively mandated year 2003. In
    order to accomplish that goal, appropriations to LBRWS must be adequate
    to plan and construct, with all related costs, at least one major core
    pipeline project each year. Funding at a level inadequate to accomplish
    that will cost an additional $340,000 in administrative cost for each
    year of inadequate funding, thus removing those funds from our total
    authorized expenditure and, very possibly, depleting authorized funding
    available for construction to a level which will not allow full
    completion of the LBRWS core pipeline.

            ATTACHMENT A.--PROGRESS ON MNI WICONI DISTRIBUTION SYSTEM
    ------------------------------------------------------------------------
                                                       Rural
                                                    Residential  Constructed
                    Project/Status                   Population    Pipeline
                                                      (number)     (miles)
    ------------------------------------------------------------------------
    OSRWSS:
        White Clay/Wakpamni, Operating............          991           65
        Slim Buttes, Operating....................          403           42
        Kyle North, Operating.....................          408           28
        Kyle to Sharps Corner, Operating..........          583           44
        West Boundary, Operating..................           16           10
        Manderson Loop I, Operating...............          562           42
        Manderson Loop II, Operating..............          292           31
        Manderson Loop III, Operating.............          530           24
        Manderson Loop IV, Construction Awarded...          530           32
        Manderson Loop V, Design OnGoing..........          398           27
        Rockyford to Redshirt, Construction                 228           57
         Awarded..................................
                                                   -------------------------
          Subtotal................................        4,940          402
                                                   =========================
    WR/LJ:
        Creighton Area, Operating.................          238          179
        Elbon Area, Operating.....................          363          274
        Kaodaka Area, Operating...................          318          247
        Grindstone South, Operating...............          195          128
        Reliance Area, Operating..................          267          115
        Vivian North, Construction Awarded........          240          135
        Mellette County West, Construction Awarded          214          171
        Draper City Distr, Bid....................          152            3
        Ft. Pierre West, Design OnGoing...........          246          115
        Mellette County East, Design OnGoing......          147          103
        Presho, Design OnGoing....................          240          100
                                                   -------------------------
          Subtotal................................        2,619        1,570
                                                   =========================
    RS RWS:
        He Dog/Upper Cut Meat, Operating..........          450           35
        Soldier Creek/Ring Thunder, Operating.....          215           18
        Phase III, Operating......................          510           27
        Phase IV, Under Construction..............           20           21
        N Parmalee/Black Pipe, Design OnGoing.....           40           12
        Mission/Antelope/Ring Thund, Design                 125            6
         OnGoing..................................
        St. Francis, Design OnGoing...............        1,200           15
        Rural Distribution, Design OnGoing........          250           15
                                                   -------------------------
          Subtotal................................        2,810          149
                                                   =========================
    LB RWS:
        West Brule to Reliance, Operating.........  ...........           14
        County Line Road Pipeline, Bidding........  ...........           14
        Vivian to Presho, Design OnGoing..........  ...........           11
        Presho to Kennebec, Design OnGoing........  ...........            9
                                                   -------------------------
          Subtotal................................  ...........           48
                                                   =========================
          Totals..................................       10,369        2,169
    ------------------------------------------------------------------------

                                     ______

      Prepared Statement of Robert J. Byrnes, Mayor, City of Marshall, MN
        Chairman Domenici and Members of the Appropriations Subcommittee, I
    appreciate the opportunity to submit this testimony on behalf of the
    City Council and the citizens of Marshall. Minnesota. We are requesting
    $2.275 million in Federal funds for the construction of Stage II of the
    flood control project authorized in the Water Resources Development Act
    of 1986. This is the funding level that the U.S. Army Corps of
    Engineers has determined is essential for Stage 2 work on the Marshall,
    Minnesota Flood Control Project in fiscal year 2000. The Assistant
    Secretary of the Army (Civil Works) has ask Congress to provide $2.275
    million for the Marshall project in his Budget Request for the U.S.
    Army Corps of Engineers for fiscal year 2000.
        The Conference Committee designated $1.5 million for the Marshall
    project in the fiscal year 1999 Appropriations Bill. These funds were
    augmented by $700,000 transferred to the project by the Corps of
    Engineers, and $750,000 appropriated by the Minnesota State Legislature
    in 1998. In addition, the City of Marshall has allocated cash funds of
    nearly $1 million to the project, financed the dredging and
    reconstruction work required on the diversion channel at a cost of
    $350,000, and purchased property and easements at a cost of about $1
    million.
        The plans and specifications for the construction work have been
    completed, and the project advertised for construction bids. All the
    necessary property and easements have been purchased by the City. The
    preparation work in Stage 1 of the project has been completed including
    the dredging and enlargement of the diversion channel and the repair or
    replacement of gates. The Ditch 62 project has been completed which
    provides for the storm water collection system for about 60 percent of
    the City. Bids for Stage 2 construction are scheduled to be opened
    today, March 24, 1999, with construction scheduled to begin in April,
    1999.
                        project location and description
        The project is located in Lyon County in the Southwest corner of
    the State of Minnesota, about 145 miles southwest of St. Paul. It is
    near the center of the Redwood River basin. Southwest State University,
    the business district, and most of the homes of the nearly 13,000
    citizens are located in the floodplain of the Redwood River. Marshall
    serves as the county seat of Lyon County, and is the commercial and
    agricultural center for the region.
        The Redwood River, a tributary of the Mississippi, enters the
    southwest corner of the City, winds its way through the City, exiting
    at the northeast boundary near the University campus. The Redwood River
    basin serves an elongated drainage area of approximately 743 miles. The
    river's elevation drops at the significant rate of 19 feet per mile
    until it reaches the City. There the river slope flattens out to an
    average of about 4 feet per mile. The lack of a confining valley, and
    the reduction in grade on the plain, contributes significantly to
    overland flooding in the Marshall area.
        The geological decline in the elevation in the 50 miles from the
    watershed area to the City of Marshall is greater than the Mississippi
    River elevation decline from Minneapolis to New Orleans.
        A federally constructed flood control project was completed in
    1963. While it is successful in protecting much of the City during
    frequent, smaller floods, the upstream and downstream channels were not
    effective during major flood events. At those times, the Redwood River
    overflows a county highway, bypasses the diversion control structure,
    and floods the inter city area.
        The project is designed to protect the City of Marshall from major
    flood events. Briefly, the authorized plan calls for channel
    improvements, drainage facilities, the construction of 4.7 miles of
    additional levees, 3.8 miles of bank protection, 0.3 miles of new high-
    flow diversion channel, an inter basin overflow structure,
    modifications to the existing diversion channel and drop structures,
    and limited recreation trails, picnic and rest area facilities.
                     project authority, funding, and status
        The Marshall Flood Control Project was authorized in the Water
    Resources Development Act of 1986, and reauthorized in the Water
    Resources Act of 1988. Funds were allocated in fiscal year 1984 to
    initiate preconstruction engineering and design work. The total project
    is estimated to cost $10.75 million of which Federal costs are
    estimated to be $7.85 million, and non-Federal costs of $2 million. The
    non-Federal costs have been provided through the State flood mitigation
    grant program, and by bonding by the City of Marshall. The Design
    Memorandum and Environmental Assessment were completed and approved in
    1987.

    Summarized Federal Financial Data

    Estimated Federal Cost..................................      $7,850,000
    Estimated non-Federal Cost..............................       2,900,000
                        --------------------------------------------------------
                        ____________________________________________________
          Total Project Cost................................      10,750,000
                        ========================================================
                        ____________________________________________________
    Federal Allocations to Date.............................       4,397,000
    Balance of Federal funds to Complete Project............       3,453,000
    Benefit-cost Ratio (8 percent)..........................            1.10
                             flow agreement signed
        A major issue to be resolved in the Marshall Flood Control Project
    was the flow rate of the Redwood River during major flood conditions.
        A portion of the Redwood River basin waters are diverted into the
    Cottonwood River basin. The project will require that historic
    overflows are maintained between the two watershed districts. After
    numerous public meetings, a flow distribution agreement was executed on
    February 22, 1998, by the City of Marshall, Lyon County, the State of
    Minnesota, and the Corps of Engineers.
                               project background
        Water and land related problems in the Minnesota River basin were
    first investigated by the St. Paul District Engineer in 1934, but his
    study did not address the flooding and related problems in Marshall. In
    1960, after the severe floods of 1957, improvements were recommended by
    the Corps which included the construction of levees and a floodwater
    diversion channel.
        This flood control project was completed in 1963, by the U.S. Army
    Corps of Engineers to, ``provide protection for the people and property
    of Marshall from the frequent flood risks.'' The major feature of the
    project was a 2.4 mile diversion channel around the west and north
    sides of the City, a 1,840 foot levee at the upstream end of the
    project, and other features. The channel was designed to handle a 6,500
    CFS flow. The overflow, then, would move naturally into the Cottonwood
    River Watershed south of Marshall.
        In 1969, a flood of 8,090 CFS was experienced in Marshall. The
    river channel both upstream and downstream from Marshall was inadequate
    to convey the 1963 design flows either to or from the diversion
    channel. At flows greater than 3,500 CFS, floodwaters bypass the
    diversion channel and flood the inner City of Marshall.
        As a result of the failure of the 1963 flood control project to
    protect the City, other studies were conducted by a private engineering
    firm under the direction of the Corps in 1974. The Corps completed a
    flood control report in 1976, and a feasibility study in 1979. This
    report was updated by a reevaluation of the problems in 1984. The
    current project was then authorized in the 1986 Water Resources
    Development Act. It is important to note that the project as
    constructed in 1963, has worsened the potential of flooding for the
    City. The rate of flow is not adequate to move the flood waters through
    the diversion channel, and other problems.
        The three ``Holiday Floods of 1993'' (Mother's Day, Father's Day
    and Independence Day) occurred at both ends of the diversion channel,
    causing hundreds of thousands of dollars in damages to homes,
    businesses, and the City's infrastructure. As the water levels remained
    at flood stage throughout the summer, it created an atmosphere of fear
    and unrest among the citizens of Marshall.
        In 1995, the Redwood River was again flowing at capacity, and the
    City of Marshall narrowly avoided a disaster worse than the floods of
    either 1969 or 1993. From 9 to 15 inches of rain fell near Montevideo,
    Minnesota, less than 40 miles from the Redwood Watershed District.
        If the storm had moved only a few miles to the southwest, the flood
    waters would have engulfed the City at a rate of 8,000 to 12,000 cubic
    feet of water per second. This is a much greater water overflow than
    that which occurred in the disastrous flooding of 1969, and as much as
    three times greater than the 1993 floods.
        The District Office of the Corps of Engineers provided estimates
    stating that the City would have incurred millions in property damage,
    and that flash flooding of this nature could well have resulted in the
    loss of lives. Corps officials stated that flash flooding of this
    magnitude would have made most emergency measures futile. As a result
    of the flat terrain in and around the City, and much of the Marshall
    community would have been under water.

                               STAGE 2--CORPS SCHEDULE FOR MARSHALL FLOOD CONTROL PROJECT
    ----------------------------------------------------------------------------------------------------------------
                           Activity                               Beginning date               Completion date
    ----------------------------------------------------------------------------------------------------------------
    Plans & Specs Initiated..............................  2/28/96.....................  Complete
    Plans and Specs Submitted............................  2/28/98.....................  Complete
    Plans & Specs Approved...............................  3/31/98.....................  Complete
    Real Estate. Acquisition.............................  12/31/98....................  Complete
    Certification of Real Estate.........................  1/15/99.....................  Complete
    Construction Contract Advertised.....................  2/24/99.....................  Complete
    Construction Contract Awarded........................  3/24/99.....................  3/24/99
    Construction Contract Completion.....................  3/24/99.....................  4/6/99
    Construction Stage 2 Completion......................  4/25/99.....................  11/30/01
    ----------------------------------------------------------------------------------------------------------------

                      county ditch no. 62 drainage system
        In addition to the Marshall Flood Control Project, the overall
    protection of the City required the reconstruction and modification of
    the storm sewer drainage system. The examination of the drainage
    problems was acknowledged in the General Design Memorandum developed by
    the Corps for Marshall, but is not included, nor is it a part of the
    funding of this project.
        County Ditch No. 62 serves as the storm sewer drainage system for
    about 60 percent of the City's corporate limits. The Ditch extends
    along the northeast part of the City, in close proximity to the levee
    construction required for the Corps flood control project, and feeds
    into the Redwood River. With the growth of the community, and the
    development of property and the University campus, since the
    construction of the Ditch in 1958-9, the flooding problems in the City
    have been exacerbated by the lack of drainage and poor water movement
    in a system that is no longer adequate for the community. Construction
    was completed in 1998.
        The City of Marshall, in cooperation with Lyon County and the State
    of Minnesota, a comprehensive storm water system was planned, designed,
    and jointly funded by FEMA, the State of Minnesota, Lyon County and the
    City governments at a total cost of slightly more than $3 million.
    There are elements of the Storm Sewer/Ditch Project that are closely
    associated with the Flood Control Project.
                    stage 2--construction and funding needs
        The Corps of Engineers has accepted bids for construction work that
    spans both fiscal year 1999 and fiscal year 2000. The Congressional
    appropriation for fiscal year 1999, Non-Federal funds, and fund
    transfers by the Corps have, in combination, provided sufficient
    dollars to move ahead aggressively on Stage 2 construction this Spring.
    An appropriation of the $2.275 requested by both the Corps and City is
    critical to the project.
        Without full funding by Congress this Session for fiscal year 2000,
    construction work will come to a halt in October, 1999, causing delays
    that will substantially increase the cost of the project. Of even
    greater importance is the risk of severe flooding that will confront
    the citizens of Marshall another year. A half completed construction
    project will provide very little protection for the City.
        It has been noted by City officials that as soon as construction
    work begins, some citizens are lulled into a sense of false security. A
    number of homeowners have called the City asking to drop their costly
    flood insurance, assuming their homes are protected by the unfinished
    flood control project. Delays in the completion of the project results
    in a lack of preparation and a state of readiness by some citizens. It
    is these precautions and preparations that have prevented major
    disasters in past flood events.
        For these reasons, we respectfully request this Subcommittee to
    appropriate $2.275 million of Federal funds in the fiscal year 2000
    Appropriations Act to continue the work required under Stage 11 of the
    Marshall Flood Control Project. This action will prevent further delays
    in the completion of the project, and avoid the over budget costs that
    inevitably occur when construction is stopped in the middle of a
    project.
        Thank you for the opportunity to bring this critical matter to your
    attention through this statement. I will be delighted to respond to any
    questions you may have about the project.
                                     ______

     Prepared Statement Chairman Harold Miller, Chairman, Crow Creek Sioux
                                     Tribe
        The Crow Creek Sioux Tribe respectfully requests funds in fiscal
    year 2000 to complete the feasibility study and for predesign
    activities for the Crow Creek Sioux Rural Water System, in the amount
    of $235,000. The funds requested will complete the feasibility study
    currently underway, including the preparation of an Environmental
    Assessment and Class I Archaeological survey, and provide for the
    purchase of Geographic Information System (GIS) hardware to enable the
    Tribe to plan for the development of a Municipal, Rural and Industrial
    Water System for the Crow Creek Indian Reservation.
                   background--completion of needs assessment
        The Crow Creek Sioux Tribe resides on the Crow Creek Indian
    Reservation in central South Dakota on the eastern bank of the Missouri
    River, a virtually unlimited water supply (Figure 1). Table 1 presents
    the findings of our investigations of water needs to date.
        Crow Creek has completed a Needs Assessment Report for the
    Municipal, Rural and Industrial Water System. The report addresses
    needs of a water project throughout the Crow Creek Indian Reservation
    with a total cost of $24,750,000. The system would be designed to serve
    a future population of 2,843 persons, primarily members of the Crow
    Creek Sioux Tribe. Because the Crow Creek Sioux Tribe is youthful, with
    median age of 18.9 years, the population is growing at a moderately
    high rate, and the need for drinking water facilities will grow as time
    passes.
        Existing facilities include the Fort Thompson, Crow Creek, Big Bend
    and Stephan public water systems, which serve an estimated population
    of 1,520. Distribution facilities in the public water system would be
    incorporated into the new project and improved upon where necessary.
    The existing intake and treatment plant with 450 gpm capacity at Fort
    Thompson would likewise be retained. Existing storage facilities with
    241,000 gallons of capacity would be incorporated.
        Quality of water in the public drinking water systems ranges from
    good to poor. The Fort Thompson and Crow Creek systems, for example,
    have total dissolved solids (TDS) within the range of acceptable
    limits, but the Stephan and Big Bend water systems have total dissolved
    solids that exceed suggested limits of acceptability, (Table 1). Some
    of the individual rural wells, not connected to public water systems,
    have acceptable water quality, but the majority of individual wells has
    poor water quality with total dissolved solids ranging as high as 4,440
    milligrams per liter.
        The Missouri River is a source of dependable water supply for a
    municipal, rural and industrial water project on the Crow Creek Indian
    Reservation. The average annual streamflow at Fort Randall Dam is
    18,214,000 acre feet. Streams crossing the Crow Creek Indian
    Reservation, such as Campbell Creek, Elm Creek and Crow Creek, are not
    dependable supplies of water.
        Groundwater may be a reliable source of supply in the southeast
    corner of the Crow Creek Indian Reservation. Sufficient exploration of
    the terrace gravels at these locations has not been undertaken to
    determine the long-term availability of water and its quality.
        Need for a municipal, rural and industrial water project on the
    Crow Creek Indian Reservation averages 262 gallons per capita per day,
    including 48 gallons per capita per day for heavy water using industry,
    such as a meat packing plant. The average need reflects system losses
    of 38 gallons per capita per day, 15 percent of demand, an acceptable
    level of leakage in transmission, distribution and in-house fixtures.
    The average 262 gallons per capita per day reflects water uses for full
    employment, commercial and industrial development of the Reservation,
    provisions for livestock and moderate water conservation practices, the
    latter reflecting a future plumbing code requiring the use of water
    conserving fixtures in the home. Provision is also made for lawns and
    gardens surrounding each of the 978 households projected for the
    Reservation in year 2020 (Table 1).
        The average future water need is 743,748 gallons per day. On days
    of the year when maximum water use is approached, needs will rise to
    1,926,000 gallons, approximately 2.59 times the average day requirement
    . These values are equivalent to a maximum day flow of 1,338 gpm, of
    which 450 gpm will be provided from the existing system at Fort
    Thompson.
        Construction costs of the water project are estimated at
    $24,750,000. Twenty nine (29) pumping stations would be required
    throughout the system with a total of 463 horsepower. Electrical costs,
    based on 1996 dollars, would average $58,430 annually. Operation and
    maintenance costs of the pumping stations have been estimated at
    $17,000 annually, (Table 1-1). The project will require 181 miles of
    pipeline (985,000 feet).
                          status of feasibility study
        The Crow Creek Sioux Tribe obtained language in the fiscal year
    1998 budget as follows:

              . . . the Secretary of the Interior may use $185,000 of the
            funding appropriated herein for a feasibility study of the
            alternatives for the Crow Creek Rural Water Supply System to
            meet the drinking water needs on the Crow Creek Indian
            Reservation.

    105th Cong., 1st Sess., Amendment No. 872, Congressional Record, p.
    S7506 (July 15, 1997).
        The Tribe entered a Cooperative Agreement with Reclamation on
    September 28, 1998 for the preparation of a Special Study of
    Feasibility Considerations for the Crow Creek MR & I Water System. This
    requires compliance with the National Environmental Policy Act (NEPA),
    National Historic Preservation Act, section 404 of the Clean Water Act
    for wetlands protection, and a detailed demonstration of the
    construction and operational costs. Rights of way, easements, licenses
    and other required permits shall be addressed.
        The Bureau of Reclamation retained $20,000 of the $185,000 provided
    in fiscal year 1999 for federal administrative expenses associated with
    the Special Study. Reclamation's detailed review and comments shall
    extend the originally contemplated period of time to complete the
    Study. Consequently, an additional $75,000 is required to complete the
    Feasibility Study.
        In addition, the sum of $85,000 is required for the acquisition of
    Geographical Information System (GIS) computer hardware, and $60,000 is
    required for two full time employees (FTE), a Project Coordinator and a
    GIS Technican. The sum of $15,000 is needed for training the GIS
    Technician.
        The sum of $235,000 is required in fiscal year 2000 for the Crow
    Creek MR & I Water System.
                                   conclusion
        The project as proposed will provide safe and adequate drinking
    water to the Crow Creek Indian Reservation for the projected
    population, the development of commercial and business activities,
    development of a heavy-water using industry and the support of all
    livestock within the Reservation. The sum of $235,000 is required in
    fiscal year 2000 to complete the Feasibility Study and enable the Crow
    Creek Sioux Rural Water System to acquire the GIS computer hardware
    needed for predesign activities.

      TABLE 1-1.--STATISTICAL SUMMARY CROW CREEK SIOUX MUNICIPAL, RURAL AND
                            INDUSTRIAL WATER PROJECT
    ------------------------------------------------------------------------
                                                                     2020
                                                    1990 Census   Projected
    ------------------------------------------------------------------------
    Crow Creek Population.........................        1,756        2,843
        Indian....................................        1,532        2,775
        Non-Indian................................          224           68
    Median Age:
        Crow Creek................................         18.9  ...........
        South Dakota..............................         32.6  ...........
    Crow Creek School Enrollment:
        Ages 3 and 4..............................           40           73
        Ages 5 to 14..............................          416          765
        Ages 15 to 17.............................           97          179
        Ages 18 to 19.............................           17           58
        Over 20...................................           42          122
                                                   -------------------------
          Total...................................          612        1,197
    Housing:
        Households................................          434          948
        Persons per Household.....................         4.05         3.00
    ------------------------------------------------------------------------

    ------------------------------------------------------------------------
                                                                    South
                                                     Crow Creek     Dakota
    ------------------------------------------------------------------------
    1990 Household Income.........................      $12,673      $22,503
    1990 Family Income............................       13,125       27,602
    1990 Per Capita Income........................        3,717       10,661
    Percent Families Below Poverty Level..........         49.5         11.6
    1990 Labor Force..............................          480      342,112
    Unemployed....................................          139       13,938
    Percent in Labor Force........................         55.7         74.3
    Percent Unemployed............................         29.0          4.1
    ------------------------------------------------------------------------

                                                                       Value
    Existing Public Water Systems:
        Population Served...................................           1,520
        Service Connections.................................             305
        Flow Capacity, gpm..................................             535
        Storage Capacity, gallons...........................         241,000
    General Water Quality, TDS, mg/l:
        Secondary Suggested Limit...........................             500
        Fort Thompson.......................................             479
        Crow Creek..........................................             706
        Stephan.............................................           1,500
        Big Bend............................................           1,928
        Rural Wells:
            Maximum Observed................................           4,440
            Average Observed................................             702
    Water Availability:
        Missouri River Streamflows, af/year.................      18,214,000
        Campbell Creek Streamflows, af/year.................           2,669
        Elm Creek Streamflows, af/year......................           5,169
        Crow Creek Streamflows, af/year.....................          13,749
        Missouri River Monthly Minimum, af/month............         260,668
        Tributary Monthly Minimum, af/month.................................
        Groundwater.........................................    Goof to Poor
    Design Needs, gallons per capita per average day:
        In-Residence........................................              81
        Lawns and Gardens...................................              62
        School Enrollment...................................               7
        Labor Force.........................................              11
        Commercial and Industrial...........................              13
        Heavy Industry......................................              48
        Livestock...........................................              14
        System Losses.......................................              38
        Water Conservation..................................             -12
                        --------------------------------------------------------
                        ____________________________________________________
          Total.............................................             262
    Design Needs:
        Average Day, gallons................................         743,748
        Maximum Day, gallons................................       1,926,308
        Maximum Day, gpm....................................           1,338
        Annual, af..........................................             833
                                     ______

       Prepared Statement of Jay L. Kimble, Mayor, City of Stillwater, MN
        Chairman Domenici and Members of the Appropriations Subcommittee, I
    thank you for the opportunity to submit this testimony requesting the
    remaining $1.2 million needed to complete Stage 2 of the Stillwater,
    Minnesota flood control project. Construction of Stage 2 extension of
    the levee system will commence in late June or early July of 1999, and
    is scheduled for completion by November 30, 2000, river levels
    permitting.
        The project was delayed first by the floods of 1997, and secondly,
    the soil beneath the planned levee extension was very unstable,
    requiring a revision of plans and the addition of another stage in the
    construction process.
        The flood waters of the St. Croix River did.not recede until August
    of 1997. The construction area remained under water preventing
    construction work to proceed as scheduled. Work on Stage 1 was
    completed in late Summer of 1997, and additional soil borings were
    taken for Stage 2. The soil was found to be very unstable, and unable
    to support the levee system designed for Stage 2 of the project. The
    construction of Stage 2 is requiring remedial action, and has been
    designated as Stage 2S.
        Phase I, the repair and reconstruction of the old levee wall was
    completed in the Summer of 1998. A contract was awarded for Phase 2S in
    November, 1998, and is expected to be completed in June, 1999. Phase 2
    will begin the latter part of June or early July of this year, and will
    be completed in fiscal year 2000. Stage 3 is scheduled for completion
    in fiscal year 2002.
                    the addition of stage 2s to the project
        Nine sawmills dotted the St. Croix River waterfront at Stillwater
    during the lumbering days in the 1st half of the 19th Century. Billions
    of feet of lumber were processed and shipped all over the growing
    Midwestern part of the U.S. The current levee wall system was
    constructed in 1938, in anticipation of the backup of the St. Croix
    when Lock and Dam #2 was completed on the Mississippi. This Corps
    project resulted in the widening of the River at Stillwater, covering
    the sawdust and wood debris created by the sawmills a half Century
    earlier.
        U.S. Army Corps of Engineers reports prior to the authorization of
    this project stated, ``. . . Subsurface soils investigations along the
    waterfront in Stillwater identified pieces of glass, wood and/or layers
    of sawdust to depths of more than twenty feet below the ground surface
    as remnants of the early logging and sawmill activities.''
        Another Corps report stated, ``. . . The extent of the wood and
    sawdust precludes the economics of excavating to remove these materials
    and backfilling with satisfactory soil.''
        Additional soil borings taken during and after Stage 1 to depths of
    70 feet without finding stable soil conditions. To construct a new
    cement levee wall system on an unstable base would result in a degree
    of settling of the structure that would result in cracking and breaking
    of the levee wall. To establish a firm base for the structure is
    economically unfeasible feasible since the depths of such a base would
    have to be more than 70 feet. How much deeper is unknown.
        The third option was to pre-load the construction site with a soft,
    organic silt material equal to, or greater than the weight of the levee
    wall system. This process, over a period of time, will compact the
    unstable soil, and allow the construction of the levee wall after the
    soil has been compacted.
        The surcharge embankment (see Figure 1) was constructed between
    October and December of 1998. The Corps used 25,000 cubic yards of
    granular fill the City of Stillwater had saved from the temporary levee
    constructed during the floods of 1997. The surcharge embankment extends
    about 1,100 feet, and is between 10-15 feet in height. Settlement
    plates and vibrating-wire piezometers were installed in order to
    monitor the settlement of the subsurface soils. The engineers predict
    the settling process of the riverfront will take about six months.
                                project overview
        The purpose of the Stillwater project is to provide flood control
    and protection to the City of Stillwater, Minnesota's oldest city. The
    project is divided into three stages. Stage 1 is the repair and
    reconstruction of the existing floodwall (about 1,000 feet in length.)
    Stage 2 will extend the floodwall North of the existing wall 1,100 feet
    to prevent the annual flooding that occurs in that area. Stage 3
    includes the expansion of the flood wall protection along the West side
    of Lowell Park
                         stage 1 construction complete
        Stage 1 included the repair and reconstruction of the existing
    1,000 foot levee wall system where severe deterioration of the lower
    wall has occurred, the development of the plans and specifications for
    Phase I, the preliminary design work for Phases II and III, and a rip
    rap treatment of the South end of the levee. The rise in elevation to
    the South of the old levee permits rip rap to be used rather than
    extending the levee wall system.
        The original levee wall was constructed in 1938, under the auspices
    of the Public Works Administration (WPA), and is on the register of the
    U.S. Department of Interior's list of National Historic Sites.
        The community is delighted with the Corps' work in the restoration,
    repair and reconstruction of the old levee wall system.
        But even more important, the erosion of the water front underneath
    the structure has been halted. This levee not only protects the water
    front, but a major trunk sewer line that carries 3 million gallons of
    raw sewage each day to the Stillwater water treatment plant. The
    engineers have warned that extensive, long-term flooding would result
    in the rupturing of the trunk sewer line, and release of raw sewage
    into the St. Croix River, one of the Nation's ``Wild and Scenic
    Rivers'' designated by Congress.
        While the repair and reconstruction work in Phase I of the project
    substantially reduces the risk of a failure of the wall, it can not be
    eliminated until the levee is extended and the annual flooding of the
    area diminished.
                              stage 2 construction
        Bids for Stage 2 construction, the extension of the levee wall
    system, are expected to be awarded in July, 1999. This is an area North
    of the reconstructed levee wall in Stage 1 of the project. The Stage 2
    area is always the first area to flood, and where the most severe
    flooding occurs during Spring run offs and heavy rains. Flooding occurs
    annually at this location causing the emergency roadway adjacent to the
    levee to become impassable for 4-6 weeks each Spring.
        The Army Corps of Engineers has projected that $1.2 million will be
    required to complete the work on the Stage 2 floodwall extension. These
    funds will be needed in the Spring of fiscal year 2000, to avoid the
    stoppage of construction work in the middle of Stage 2. Without funding
    at the appropriate time, contractors would remove their equipment,
    including barges used for heavy equipment, and reassign personal, thus,
    increasing the cost of the project to both the City and the Federal
    government. The United States Congress appropriated $2 million in
    fiscal year 1999 to initiate work on Stage 2.
                              stage 2s in process
        Stage 2S (``S'' for surcharge) was commenced in October, 1998 and
    the surcharge placement was completed in December, 1998. It is
    anticipated that the surcharge will need to be in place for
    approximately six months, and that the process will compress the
    subsoil from 18-24 inches. This will enable construction of the flood
    wall to begin in mid Summer, and continue in the early Spring of 2000.
    The cost of the placement of the surcharge was $255,000. Additional
    costs will be incurred with the monitoring and removable of the
    surcharge embankment in the Summer of 1999.
                                    stage 3
        Stage 3 consists of the construction of a secondary flood wall 125
    feet inland from the existing levee. The wall will extend about two
    feet above the ground. Sheet piling will be driven 15 to 20 feet below
    the surface to prevent the seepage through the porous soil that occurs
    during flood conditions. The secondary flood wall will provide the City
    with a 50-year flood protection plan, and with the use of sandbags, a
    100 year protection program. The seepage which now occurs with
    sandbagging during flood events will be resolved by the deployment of
    the sheet piling as a part of the flood wall.
        The U.S. Army Corps of Engineers is preparing a decision document
    to validate the economic feasibility of the construction of the low
    floodwall along the Western side of Lowell Park. The cost estimate for
    Stage 3 is $4.25 million.
                                protect schedule
        Stage 1--Construction Completed--October, 1997.
        Stage 2--Project design, plans and specifications--Complete.
        Stage 2S--In process. Completion date--July 1999.
        Stage 2--Award bid for construction--July 1999.
        Stage 2--Construction complete on Stage 2--October 2001
        Stage 3--Study on for flood wall economics on October 1999.
        Stage 3--Construction--April 2001.
                              legislative history
        This project was authorized for $3.2 million in the Water Resources
    Development Act of 1992. Both the House and the Senate Energy and Water
    Development Appropriations Subcommittee designated $2.4 million in
    Federal funds for the purpose of designing, repairing, extending, and
    expanding the levee wall system in the fiscal year 1994 Appropriations
    Act. Additional Congressional appropriations were made for fiscal year
    1997, fiscal year 1998, and fiscal year 1999 totaling $4.2 million.
        The Minnesota Legislature has provided half of the required non-
    Federal matching funds totaling $1.525 million for all three stages of
    the project. The City of Stillwater has contributed $950,000 in project
    funds, and has set aside the remaining funds required for Stages 1, 2,
    and 3. To date, all non-Federal matching funds for all Stages of the
    project are either in the escrow account, or available for transfer to
    the escrow fund from the State account.
        Recognition that additional funds would be required to complete the
    project, the U.S. Congress amended the authorization in the Water
    Resources Development Act of 1997, and increased the project's
    authorization to $11.6 million. This level of funding will permit the
    reconstruction of the existing levee, the extension of the levee to the
    North, and the expansion of the levee wall by the construction of a
    flood wall. The completion of Stage 3 is contingent on the decision
    document in preparation by the Corps.

    Summarized Financial Data \1\

    Federal Cost..................................................$6,670,000
    Non-Federal Cost.............................................. 2,670,000
                        --------------------------------------------------------------
                        ____________________________________________________

          Total Project Cost...................................... 8,893,000

    Allocations to Date........................................... 5,652,000
    Balance to Complete.....................................       1,118,000

    \1\ Does not include costs for Stage 3.
    ---------------------------------------------------------------------------
                     historical significance of the project
        The historic implications of the retaining wall system, and its'
    solution, are extremely important to the entire State. In recognition
    of the historic significance of Stillwater as the ``Birthplace of
    Minnesota,'' the U.S. Army Corps of Engineer conducted an excellent
    study completed in July, 1985, entitled, ``Historical Reconstruction of
    the Riverfront: Stillwater, Minnesota.''
        The purpose of the study was to provide the Corps of Engineers with
    information to be used in the review of options for flood control of
    the downtown area of the City. The research identified 117 sites in the
    floodplain as being significant to the entire State. Twenty-three of
    these sites are listed on the ``National Register of Historic Places''
    by the U.S. Department of Interior. All are threatened by the lack of
    an effective flood control system for the community.
        The U.S. Army Corps of Engineers is obligated to protect the
    cultural or man made environment according to the Corps 1985 study. The
    obligation is embodied in these laws that set forth Federal leadership
    in locating, inventorying, and protecting such sites. The proposed
    reconstruction and extension of the retaining wall system does not
    threaten, damage, nor destroy any of the identified historical sites in
    the area.
        The project as authorized in 1992 and 1996 in the Water Resources
    Development Acts provide the protection necessary to preserve these
    historic structures for future generations.
                                action requested
        Based on the information and data from the ``Design Memorandum''
    and information prepared by the U.S. Army Corps of Engineers, $1.2
    million in Federal support will be needed in fiscal year 2000, and is
    requested from this Committee. In recognition of the urgent need for
    the completion of this project, Congress increased the authorization in
    the Water Resources Development Act of 1996 to provide for the
    completion of Phase II, and the opportunity to provide flood control
    measures in Phase lilt
        The project is in full compliance with the National Environmental
    Protection Act, the National Historic Preservation Act (16 U.S.C. 470
    (f) and Section 110 (f), 16 U.S.C. 470h-2 (f), the Minnesota State
    Historic Preservation Office, and have met the special provisions and
    requirements of Federal and State laws that protect the wild and scenic
    rivers, and other State and Federal laws enacted to protect the
    environment and historic sites. We have been working with these
    agencies for many years in anticipation of the construction and
    extension of the levee system, and have a summary listing of their
    letters of support for the project.
        For these reasons we respectfully request that this Subcommittee
    appropriate the sum of $1.2 million for the completion of Phase II
    construction in the Energy and Water Development Appropriations Bill
    for fiscal year 2000. Thank you for the opportunity to bring this
    critical matter to your attention through this statement. We would be
    pleased to respond to any questions the Members of this Committee may
    have.
                                     ______

     Prepared Statement of the Minnesota-Wisconsin Boundary Area Commission
                corps of engineers--construction general budget
        The Minnesota-Wisconsin Boundary Area Commission operates under
    interstate compact to assist its sponsor states in coordinating public
    policies and programs on the Mississippi and St. Croix Rivers, which
    together comprise 265 miles of their bi-state boundary. One of its
    tasks is to assist in the participation by the two states in federal
    programs which relate to the protection, use and development of the
    waters, lands and river valleys.
        The Commission has ten citizen commissioners, five from each state,
    appointed by their respective governor. The Commission has long been a
    champion of the Upper Mississippi River Environmental Management
    Program (EMP) and urged and assisted Congress to create it the Water
    Resources Development Act of 1968. Because the Upper Mississippi River
    has such complex ecological and economic resources under the
    jurisdiction of many agencies and units of government, our Commission
    has fostered and been a part of numerous partnership efforts on the
    river in its 33 years of service.
        The Commission recommends appropriation of the full amount
    recommended in the President's Budget [$18,995,000] for the Upper
    Mississippi River EMP in fiscal year 2000.
        The Upper Mississippi River System EMP has become the primary means
    by which the federal agencies and states are working together to
    restore habitat, to gain a better understanding of how the Upper
    Mississippi River System functions as an ecosystem, and how it would be
    likely to respond in future management scenarios.
        The EMP's habitat rehabilitation and enhancement and long term
    resource monitoring programs cover the entire 1,300 miles of the Upper
    Mississippi River and Illinois River/Waterway from the Twin Cities and
    Chicago, respectively, down to the confluence with the Ohio River. This
    is the only inland river in the Nation designated by Congress as both a
    major national wildlife refuge system and a major commercial navigation
    system. Through more than two decades of cooperative partnership work
    among the five basin states and the Corps of Engineers and Department
    of the Interior, co-managers of federal river missions here, a
    management strategy where the ecosystem and navigation purposes
    complement one another has been worked out and implemented. This
    success story needs to be continued without interruption. We
    respectfully urge the Congress to again support this appropriation as
    being in the national interest on ``The Nation's River.''
                                     ______

               SOUTHWEST U.S. WATER RESOURCE DEVELOPMENT PROJECTS
    Prepared Statement of William D. Hodges, President, Board of Directors,
                        Trinity River Authority of Texas
        Thank you for this opportunity to submit testimony for
    consideration in regard to fiscal year 2000 budget preparation. The
    Trinity River Authority of Texas requests that this letter and the
    requests included herein be included in the formal record for the
    fiscal year 2000 budget hearings.
        Federal participation in Trinity River watershed water resource
    projects has contributed substantially to Texas' economic development
    and represent some of the soundest investments ever made with federal
    funds. We respectfully request your committee's continuing support on
    the following projects within the Trinity River basin:
        Wallisville Lake, Texas.--After decades of delay, this most
    important project at the mouth of the Trinity River is nearing
    completion. The Galveston District of the U.S. Army Corps of Engineers
    has expressed the capability of beneficially spending $4,756 million
    that will complete this project. The need for completion has been more
    pronounced because of the drought conditions experienced in 1997 and
    1998. The operation of Wallisville will eliminate the need to release
    fresh water from Lake Livingston to keep saltwater out of the rice
    fields of the lower Trinity River valley. Enough water to supply
    approximately 40 percent of Houston's needs was released for the past
    two years. The President's budget message did not contain any funds for
    this activity, but we ask that you take all actions necessary to have
    this level of funding added to the final fiscal year 2000 budget.
        Upper Trinity River Basin, Texas.--The North Central Texas Council
    of Government is the sponsor of this project. With the assistance of
    nine cities, two counties and one special purpose district the NCTCOG
    is contributing matching funds for this widely supported study. TRA
    strongly supports the recommended appropriation of $720,000 included in
    the President's budget message. If funded by Congress, these funds will
    be used to design necessary improvements to the existing Dallas
    Floodway.
        Dallas Floodway Extension.--The City of Dallas is the local sponsor
    of this project. In the past year the city has passed a major bond
    issue intended to pay the local share of development costs. This
    project will extend the existing floodway approximately eight miles
    downstream and provide flood protection to a large flood-prone section
    of the city. The area within the levees will be available as a linear
    greenbelt that will be subject to extensive recreational use by the
    public. The President's budget message for fiscal year 2000 includes
    $1.553 million to continue pre-construction and design activities. TRA
    encourages your support for this appropriation.
        Navigation to Liberty.--The City of Liberty and the Chambers-
    Liberty Counties Navigation District are the local sponsors of an
    existing six-foot federal channel to the Port of Liberty at river mile
    45. This channel is in need of maintenance dredging, but no funds have
    been included in the President's budget message. The Corps of Engineers
    estimates that an additional $900,000 will be necessary to complete the
    channel to Smith Point which was funded this year. The Corps estimates
    that an additional $1.5 million would be necessary to maintain the
    channel to Liberty. We request that your committee include a total of
    $2.4 million in the fiscal year 2000 budget for these purposes and
    direct the Corps of Engineers to complete this work.
        Operations and Maintenance.--Other funds are included in the
    President's budget for operations and maintenance for a series of
    federal Trinity River watershed lakes for which TRA serves as local
    sponsor. These projects include Lakes Bardwell, Navarro Mills, Joe Pool
    and Wallisville.
        I would like to express our appreciation for this committee's
    historic support for water resource development in the Trinity River
    watershed. I can assure you that it is money well spent.
                                     ______

    Prepared Statement of Richard Castro, Chairman, El Paso Water Utilities
                              Public Service Board
        Mr. Chairman, thank you for the opportunity to testify before this
    committee in support of the one million dollar appropriation request
    for the El Paso Wastewater Reclamation program. My name is Richard
    Castro. I am Chairman of the El Paso Water Utilities Public Service
    Board which is responsible for developing and operating the wastewater
    and water supply system in the City of El Paso.
        The City of El Paso, Texas is located in the desert at the junction
    of the Texas, New Mexico and Mexican borders. It is Texas' fourth
    largest city, and the third fastest growing metropolitan area in the
    United States. The El Paso, Texas and Ciuadad Juarez, Mexico, area
    forms the largest international border community in the world with
    shared water supply sources.
        El Paso faces a serious future water supply shortage with its arid
    climate and depleting underground aquifers, and water conservation is
    essential to preserving the City's future. Since 1991, when a water
    conservation ordinance was adopted by the City, year-round conservation
    measures have been strictly enforced, including restrictions on
    residential watering, non-commercial car washing, and incentives to
    prevent water flowing into streets and leaks. Over the past eight years
    this conservation program has reduced the per capita use of water from
    203 gallons per day to 162 gallons per day. Despite this success, the
    City of El Paso and Ciuadad Juarez, Mexico, will deplete their
    groundwater supplies within the next 25 years.
        The El Paso Reclaimed Water Project will serve the central El Paso
    area and will provide reclaimed water to serve a variety of needs.
    These include several large turf areas, including the Ascarate
    Municipal Golf Course, the Chamizal National Park, local schools and
    cemeteries, and City parks. Government users include the El Paso
    Community College and a Juvenile Detention Center located in the
    central part of El Paso. The project will also serve the Chevron
    refinery, which is expected to be the largest reclaimed water customer
    in El Paso, requiring one million gallons a day.
        Given the density of the potential customers within the project
    area, the project is the most cost-effective reclaimed water
    distribution system within the City of El Paso. Three different
    alternatives for delivering reclaimed water have been developed and are
    being analyzed using a hydraulic computer model. Each alternative
    includes in its schematic a single distribution system, dual
    independent systems, and a single system constructed in two phases.
        The proposal was authorized under Public Law 104-266 in 1996 and
    received $750,000 for the cost of initial planning and design in the
    fiscal year 1999 Bureau of Reclamation budget. The one million dollars
    requested for fiscal year 2000 will allow for construction to begin on
    the project. As with other Title XVI projects, 75 percent of the
    project funding will be provided by our local government.
        The past support of this Committee and the U.S. Bureau of
    Reclamation has allowed the City to initiate the largest and most
    efficient water reuse project in the state of Texas. Additional funding
    and other support have been given to the project by the state, the
    North American Development Bank and the Border Environment Cooperation
    Commission. However, the City is to the point where expansion of water
    reuse is now needed on an even larger scale. Reclaimed wastewater is
    the essential element and is at the core of our long term water
    conservation and water supply plans and programs. Only with your help
    will we be able to move forward in a timely manner. We greatly
    appreciate the assistance provided by this Committee in the past and we
    respectfully urge your support and assistance in allocating one million
    dollars in fiscal year 2000 for the El Paso Reclaimed Water Project.
                                     ______

     Prepared Statement of H. Thomas Kornegay, Executive Director, Port of
                               Houston Authority
        On behalf of the Port of Houston Authority (PHA) and the over
    204,000 Americans whose jobs depend upon activity at the Port of
    Houston, we extend gratitude to Chairman Domenici, and members of the
    subcommittee for the opportunity to submit testimony in support of
    several important navigation projects included in the U.S. Army Corps
    of Engineers Civil Works budget for fiscal year 2000.
        For many years, the Port of Houston Authority has provided
    testimony to this subcommittee expressing appreciation for providing
    the funds necessary for the Houston Ship Channel (HSC) to remain fully
    functional by maintaining proper dredge depths and dewatering of dredge
    disposal sites. Most importantly, we are grateful for this
    subcommittee's support through the funding request for the required
    studies prior to the authorization of the improvement project to deepen
    and widen the Houston Ship Channel. We are deeply grateful for this
    support and are particularly excited about the partnership of this
    subcommittee, the Army Corps of Engineers and the Port Authority in
    marching forward with an insightful view of the future of one of our
    Nation's busiest ports in foreign commerce.
        We express full support of the fiscal year 2000 Corps of Engineers'
    budget request in the following amounts:

    Houston Ship Channel (O&M)..............................     $13,011,000
    Houston-Galveston Navigation Channels (Construction)....      60,000,000

        Each of these funding requests is important to ensure the
    continuous flow of commerce through this very busy waterway.
             the port of houston--one of the nation's busiest ports
        Port of Houston commerce generates over $7.7 billion annually to
    the Nation's economy and over 204,000 people work in jobs that are
    directly related to the Port of Houston's activity. Moreover, the port
    generates nearly $500 million in customs fees and over $525 million
    annually in state and local taxes.
        It is no exaggeration to say that the Houston Ship Channel is one
    of the most important economic lifelines between our Nation and the
    world. Houston's favorable geographic location provides easy access to
    the entire world business community through key ocean, land, and air
    routes. More than 100 shipping lines connect Houston with more than 700
    world ports and 200 countries. Three major railroads provide cargo
    distribution throughout the United States with the intermodal link of
    more than 160 trucking lines. The Port of Houston forms the core of the
    Houston international community which includes more than 350 U.S.
    companies with global operations and Houston offices for more than 45
    of the world's largest non-U.S. companies. In addition, Houston is the
    home of one of the largest consular corps in the Nation, with over 70
    foreign governments represented. These factors have made the Port of
    Houston a preferred gathering and distribution point for shippers
    transporting goods to and from the Midwestern and Western United
    States.
                   the port of houston--protecting our nation
        During the Desert Shield/Desert Storm operation, the U.S.
    government deployed 106 vessels carrying 458,342 tons of government
    cargo and military supplies from the Fentress Bracewell Barbours Cut
    Terminal at the Port of Houston. In fact, between August of 1990 and
    October of 1991, the Port of Houston was the second busiest port in the
    Nation in support of our troops. We are proud that the strategic
    location of the Port of Houston allows us to play such an important
    role in the defense of our Nation and the world.
            modernization & the environment--successful partnership
        The Houston Ship Channel, which opened in 1914, is believed to be
    the result of the first-ever federal/local cost-sharing agreement. At
    that time, the channel was 18\1/2\ feet deep. It was subsequently
    deepened to its current depth of 40 feet with a width of 400 feet. This
    last improvement was completed in 1996. While Houston is one of our
    Nation's busiest ports, it is also one of the narrowest deep draft
    channels. As you can imagine, ships and shipping patterns have
    dramatically changed to meet the demands of world trade over the last
    30 years. Yet, this busy waterway has not been widened or deepened to
    accommodate these changes. As the local sponsor for the Houston Ship
    Channel, the Port Authority began its quest to improve the channel in
    1967. For reasons of safety, environment, and economics, the Houston
    Ship Channel is long over-due to be improved. The Port of Houston, and
    its partner in maintaining this federal waterway--the Corps of
    Engineers--are leading the way to a unique approach to addressing the
    environmental interests in the improvement of the Houston Ship Channel.
    In the late 1980's, the Port Authority and the Corps of Engineers
    joined with federal and state agencies to form an Interagency
    Coordination Team (ICT) in a cooperative effort to address
    environmental concerns with the project--a process advocated by
    environmental groups and various resource agencies. The ICT included:
    the U.S. Army Corps of Engineers (USACE), the U.S. Fish and Wildlife
    Service (USFWS), the U.S. Natural Resources Conservation Service
    (USNRC), the U.S. Environmental Protection Agency (EPA), the Texas
    General Land Office (GLO), Texas Parks and Wildlife (TPWD), the Texas
    Natural Resources Conservation Commission (TNRCC), the Texas Water
    Development Board (TWDB), the Galveston Bay National Estuary Program
    (GBNEP), National Marine Fisheries Service (NMFS), the Port of
    Galveston, and the Port of Houston Authority. Several committees were
    established by the ICT. One of the most important committees
    established was the Beneficial Uses Group (BUG). The BUG, chaired by
    the Port, was charged with developing a disposal plan to utilize
    dredged material in an environmentally sound and economically
    acceptable manner that also incorporated other public benefits into its
    design. Most important was the Port Authority's committed objective
    that the final plan would have a net positive environmental effect over
    the life of the project.
        We are pleased to report that the ICT unanimously approved the
    beneficial use plan for disposal of dredged material from the HSC
    project as one that will have a net positive environmental effect on
    Galveston Bay, while significantly increasing the net economic benefits
    to the region and to our Nation. Three basic principles guided the BUG
    in their efforts: dredged material should be considered a potentially
    valuable resource; development of an environmentally acceptable
    disposal plan is intrinsic to the approval of the project; and, the
    adopted disposal plan must have long term environmental benefits for
    the Galveston Bay system. The approach utilized by the BUG for
    Galveston Bay made this effort unique and precedent setting. What was
    attempted had never been done before. The BUG developed a preferred
    disposal plan rather than reviewing a proposal in a regulatory setting.
    The BUG also addressed one of the largest navigation projects in recent
    years (approximately 62 Million Cubic Yards (MCY) of new work material
    and an estimated 200 MCY of maintenance material over the next 50
    years. Most importantly, the BUG actively solicited beneficial use
    suggestions from environmental interests and bay user groups whose
    collective ideas were given full consideration during the development
    of the recommended plan. In fact, the community identified more
    beneficial uses than the material available from the project plus 50
    years of maintenance dredging. The result was the identification of
    beneficial uses for the material to be dredged from the improvement
    project. The final plan includes the creation of 4,250 acres of marsh--
    a bird island, boater destination, restorations of two islands lost
    over the years due to erosion, and subsidence. In addition, an
    underwater berm will be constructed to provide storm-surge protection
    and habitat.
                   port of houston--looking toward the future
        The voters of Harris County in 1989 committed significant local
    funding to support these improvements. By a 2 to 1 vote, citizens
    approved a measure that will provide the local funding ($130,000,000)
    to deepen the channel to 45 feet and widen it to 530 feet. The Corps of
    Engineers and resource agencies involved in the ICT and BUG process
    have worked diligently to address all concerns and to develop a truly
    unique approach. The Port Authority heartily commends the cooperation
    and hard work of the Corps of Engineers and the state and federal
    agencies who have participated in the process that has this project
    being applauded across maritime and environmental communities. This
    project is the first in history to have netted no negative comments
    during the public review phase of the Supplemental Impact Statement
    (SIS).
              houston-galveston navigation channels (construction)
        From fiscal year 1990 through fiscal year 1999, Congress has
    appropriated nearly $93,000,000 toward the project to deepen and widen
    the Houston Ship Channel. The Port Authority has also contributed
    substantially to support this effort.
        Based on our cooperative and productive discussions with the Corps
    of Engineers, we are convinced that the optimal timeline for completing
    the navigation portion of this project is four years. A four year
    schedule will accelerate the benefits of the project and reduce its
    costs. Each year in reduction construction time adds more than $81
    million in benefits, reduces escalation costs by $4.562 million and
    drives down investment costs by more than $17 million. This
    subcommittee has agreed that this fiscally sound reasoning is good
    public policy and accordingly has provided the necessary funding to
    keep this project at the optimum schedule.
        This year, the Administration has included in the Corps of
    Engineers' construction budget the $60 million request needed to keep
    this project on the optimum schedule for completion of the navigational
    portion of the project. We understand that the budget allocations are
    predicated on anticipated revenue from the Administration's Harbor
    Services Fund proposal which includes controversial user fees. We fully
    recognize the challenges of this subcommittee in being responsible to
    the fiscal needs of the Nation and yet trying to satisfy the many
    demands on the budget for critically needed water improvement projects.
    In a recent study conducted by the Texas Transportation Institute, the
    Port of Houston was evaluated as a prototypical next generation
    megaport. The port identified channel and berth depths as a major
    impediment to accommodating ships of the future. Further, in this era
    of environmental sensitivity, the Houston Ship Channel improvement
    project is a beacon of light. The improvements to the environment that
    will be reaped from this project cannot be ignored. The Port of Houston
    Authority's Demonstration Marsh, utilizing dredged material for
    beneficial uses, has been included in the Audubon Society's Christmas
    Bird Count. Over 155 species of birds have been identified on this
    marsh built entirely with material dredged from the Houston Ship
    Channel.
        The Port Authority has a responsibility to the citizens of Harris
    County to operate the port in a cost-effective and efficient manner. We
    would not be fiscally responsible if we did not strive to realize the
    benefits of the project as soon as humanly feasible and at a most-
    efficient cost to the partners involved. We urge the members of this
    subcommittee to fully fund this important project. In doing so and in
    reaffirming the subcommittee's commitment to our Nation's port system,
    we urge the subcommittee to include the $60 million necessary to keep
    the Houston Ship Channel project on its current optimal, cost-effective
    schedule. We look forward to your leadership on this vitally important
    matter.
                 houston ship channel--operations & maintenance
        The Corps' fiscal year 2000 request for operations and maintenance
    funding includes $13,011,000 for maintenance dredging of key stretches
    of the channel, mosquito spraying, protection of various disposal
    areas, and dewatering of dredge disposal sites. These include the
    critical maintenance of channel depths at the Bayport flare--essential
    to safety; removal of existing shoaled material in the Upper Bay;
    dredging of Boggy Bayou to Greens Bayou; and dewatering of east and
    west Jones disposal area.
                                   conclusion
        We greatly appreciate your support in past years and urge you to
    include the funds requested to fully support these projects in this
    busy federal waterway. These maintenance projects, and particularly the
    funds necessary to continue construction of the HSC improvement project
    at an optimal schedule are vital, not only to the Port of Houston's
    continued ability to move the Nation's commerce in a safe, efficient,
    and economical manner, but also to ensure the competitiveness of this
    waterway in the world marketplace--an absolute necessity in this global
    economy.
                                     ______

      Prepared Statement of Frederick A. Perrenot, P.E., General Manager,
                                City of Houston
                     wallisville saltwater barrier project
        We would like to express our appreciation and thank the Chairman
    and this Subcommittee for their longstanding support for funding for
    the Wallisville project. This request is for the final appropriation
    necessary to complete the project.
        The Wallisville project represents the culmination of 40 years of
    cooperative efforts by the City of Houston, the Trinity River
    Authority, the Chambers Liberty Counties Navigation District and the
    U.S. Army Corps of Engineers (Corps). The Corps currently estimates
    that it will take approximately $5,000,000 to complete the project. If
    appropriated, that amount will be spent to rehabilitate the locks at
    the saltwater barrier, complete construction of the upstream overflow
    barrier (``Control Structure A''), breach an old unused dam and
    construct certain environmental enhancements to the project site.
        With the Wallisville Saltwater Barrier in place, up to 260 million
    gallons per day of freshwater held in the Lake Livingston reservoir,
    becomes available as part of the drink water supply to address the
    needs of about four million Texas Gulf Coast residents. Houston serves
    as the regional supplier of surface water to meet the needs of
    Pasadena, Baytown, Friendswood, Webster, South Houston, La Porte, Clear
    Lake and Galveston, Texas, among others, as well as several hundred
    municipal utility districts and industries.
        When completed, the water users in the greater Houston area will
    have provided a local share of approximately 66 percent of the total
    costs of the co-dependent and interrelated Wallisville Saltwater
    Barrier and Lake Livingston Reservoir projects. We urge you to closely
    consider this final appropriation request of $5,000,000 in fiscal year
    2000 so that the Wallisville project can be completed.
        Again, we want to thank this Subcommittee for its support for
    funding this project and request that this letter become part of the
    record of testimony before the Subcommittee.
                                     ______

     Prepared Statement of Douglass W. Svendson, Jr., Executive Director,
                      Gulf Intracoastal Canal Association
        This testimony for the record, March 26, 1999, before House and
    Senate Energy and Water Development Appropriations Subcommittees is
    submitted by Douglass W. Svendson, Jr., Executive Director of the Gulf
    Intracoastal Canal Association. Ours is the oldest of the regional
    waterway associations, having been established in Victoria, Texas in
    1905. The Gulf Intracoastal Waterway transports 121 million tons of
    freight annually, the third highest volume among our inland and coastal
    waterways after the Mississippi and Ohio Rivers.
        GICA's membership includes both shallow draft and deep draft ports,
    port commissions and navigation districts, barge and towing companies,
    petroleum refineries, chemical manufacturers, shipyards, marine
    fabricators, fuel terminal facilities, and individuals whose businesses
    are waterway related and dependent. We have 180 members in the five
    states of Texas, Louisiana, Mississippi, Alabama, and Florida served by
    the Gulf Intracoastal Waterway. In addition, the GIWW is the link that
    binds the North-South rivers to the canal, the coastal ports, and
    ultimately the heartland of America. The Mississippi River intersects
    the GIWW at New Orleans, one of our busiest ports, and the Tennessee-
    Tombigbee Waterway intersects the GIWW at Mobile.
                 the overall civil works budget of $4.2 billion
        During at least the last 4 years as the Administration has proposed
    smaller Civil Works budgets, most organizations who file testimony with
    your subcommittee, including ours, have expressed very strong concern
    about these reductions, whether in flood control, operations and
    maintenance, construction, or other. We were heartened when the final
    appropriated level for fiscal 1999 was approved at $1.653 billion for
    operations and maintenance.
        Because the fiscal year 2000 operations and maintenance budget
    allowance consolidates $692 million in port O&M with O&M, General,
    expenditures for the preservation, operation, and maintenance and care
    of existing river and harbor, flood control, and related works may
    actually receive less than the recommended $1.835 billion in the
    President's year 2000 budget.
        This same concern applies to funds for construction in the year
    2000 budget. If we underfund normal construction schedules that are
    obviously within the U.S. Army Corps of Engineers' capabilities, we (a)
    deny our nation the timely use of more modern locks, affecting our
    international competitiveness, and (b) add to the ultimate cost of
    construction.
                     the port fee and harbor services fund
        The combination user fee and Harbor Services Trust Fund for port
    maintenance proposed by the administration in its budget raises several
    very serious issues for waterborne transportation, our domestic
    economy, and international trade.
        Whatever the constitutional infirmities of the previous harbor
    maintenance tax, it was spread over a large base of commerce. This fact
    alone helped mitigate a potentially harsh economic impact which might
    otherwise have been injurious to many of our ports, our trade, and our
    economic jobs base.
        The proposed fee will be based on volume or tonnage, not value.
    Those most injured will be our ports that ship large volumes of
    commodities. This negative impact will ultimately fall on farmers, mine
    operators, chemical and petroleum sectors, and all commodities
    producers. Farmers and other producers have historically benefited
    economically by retaining more of the ultimate sales price in their own
    pockets, as a result of water transportation efficiencies.
        A user fee, as proposed, is much more likely, we believe, to be
    port and/or vessel specific, thus location dependent, and harm many but
    the very largest ports. Even large ports stand to lose as a result of
    the fees that could be levied on many bulk commodities which are
    routinely traded on world markets. For commodities, successful trades
    often are determined by pennies per unit of measure, or less. Margins
    are exceedingly thin and relatively large fees will easily disrupt
    normal buyer-seller patterns. Our commodities producers such as coal,
    chemicals, and agricultural products stand to lose sales and market
    share.
        A related problem involves the nature of our ports in the overall
    economy. Ports generate jobs themselves and also provide the impetus
    for related industries to establish themselves adjacent or nearby.
    Benefits of port spending are therefore quite broad in terms of
    regional and national economies. Port related growth is not
    characterized by only a few, specific identifiable beneficiaries we
    usually associate with the obligation to pay user fees. Port
    beneficiaries, including jobs creation and revenue enhancement, are the
    thousands of citizens in the affected locale or region. The numbers
    involved are broad and diverse--just such a class of people we usually
    call the general population. General revenues are employed to fund
    programs for this large a segment of the population
        Thus, the national benefits and economic significance associated
    with the sum total of port activities places these entities in a
    category which is easily able to justify the use of general revenues in
    support of broad, general economic benefits. Our association recommends
    that the Congress look seriously at funding port activities from
    general revenues, as was done prior to WRDA 1986.
                 specific budget requests for fiscal year 2000
        The Gulf Intracoastal Canal Association supports the
    Administration's budget request of $60 million for deepening and
    widening the Houston--Galveston Ship Channel. This project has enormous
    favorable economic implications for the regional and national economy.
    It also offers an opportunity to increase deep draft/shallow draft
    navigation safety.
        Approximately 100,000 barge tows and 20,000 ships transit the
    Houston Ship Channel each year. In response to the last major barge and
    ship collision causing a serious oil spill in 1992, the Houston
    Galveston Area Navigation Safety Committee (HOGANSAC) began studying
    how to prevent ship/barge collisions on the Channel. With the work of a
    broad coalition of deep and shallow draft mariners, shippers, the
    Houston Pilots, environmental groups, the Corps and the Coast Guard a
    solution was developed. The plan was to move the beacons to a straight
    line 500 feet either side of the centerline of the channel between
    Bolivar and Morgans Point and dredge the area between the beacons and
    the deep draft channel to a depth of 12 feet to allow barge tows to
    operate outside the deep draft channel.
        We also support funding for the GIWW Section 216 Studies in the
    President's budget, identified as RCP, Review of Completed Projects.
    They are Brazos River to Port O'Connor, Texas, High Island to Brazos
    River, Texas, and Port O'Connor to Corpus Christi, Texas. Within the
    Brazos River to Port O'Connor study, we urge the committee to
    specifically direct the secretary to re-route the GIWW across Matagorda
    Bay.
        Besides increasing safety, re-routing the GIWW across Matagorda Bay
    will save substantial federal outlays. The re-route would enable barge
    traffic to cross Matagorda Bay farther north than the existing
    alignment. The existing channel is much closer to the Gulf, which
    subjects our vessels to serious shoaling and very dangerous currents.
    The Corps of Engineers recommended plan is not scheduled for
    implementation until 2003 to 2005. At least $7 million (and possibly as
    much as $9 million) will be spent during that time period compared to
    $2 million to establish the re-route across Matagorda Bay now.
        These two improvements will constitute the most significant
    physical and environmental safety enhancements along the Texas coast in
    years, and are supported by the environmental community. They will also
    save scarce federal dollars.
        Our association also endorses the President's budget request of
    $8.7 million for construction of the channel to Victoria, Texas. This
    project was delayed in last year's budget because of funding levels and
    we urge the committee to provide funds for completion as soon as
    possible, consistent with the Corps' full capability.
        We support surveys funding in the President's budget for Calcasieu
    Lock, Louisiana ($691,000), and Intracoastal Waterway Locks Study,
    Louisiana ($700,000).
        We support funding for the replacement of the Inner Harbor
    Navigation Canal Lock to the extent of the Corps' full capability. We
    encourage the committee to make certain this project is expedited,
    rather than stretched out.
        The Gulf Intracoastal Canal Association also supports the
    operations and maintenance funding request for Tri Rivers Waterway
    Development Association. We support sound economic development efforts
    to improve the ACF waterway as a vital link for southeast Alabama,
    southwest Georgia, and northwest Florida to export goods to other
    national and international markets via the Gulf Intracoastal Waterway.
        We support inland waterway navigation as an environmentally sound
    and cost effective transportation mode in the Gulf South region,
    helping to reduce freight rates and promoting trade and development.
        In addition, we support the President's budget request for
    Pascagoula, Mississippi harbor project ($7,792,000) and Mobile, Alabama
    harbor project ($700,000).
        This concludes our prepared testimony. We appreciate the
    opportunity to provide this statement for the record.
                                     ______

       Prepared Statement of Ernie Zieschang, President, Port of Liberty
                                   Commission
        Thank you for the opportunity to submit testimony for consideration
    in regard to fiscal year 2000 budget preparation. The Port of Liberty
    Commission requests that this letter and the appropriation requests
    included herein be included in the formal record for the fiscal year
    2000 budget hearings.
        The Port of Liberty, Texas is located at river mile 45 on the lower
    Trinity River. Navigation to the Port of Liberty is ``run of the
    river'' and can be very difficult during low flow conditions. At the
    present time, because maintenance dredging has not been completed in
    the wake of a series of high flow events, navigation is impossible. We,
    the people of the lower Trinity River valley, have a compelling
    economic need to have our lifeline to the industrial complex on the
    upper Gulf Coast of Texas reopened.
        There are no funds earmarked in the President's budget message for
    fiscal year 2000 for maintenance dredging of the federal government's
    channel to the Port of Liberty. The Corps of Engineers has estimated
    that it will cost $1.5 million to open this channel. The Corps has also
    estimated that an additional $900,000 will be required to finish
    dredging the channel to Smith Point in Chambers County. We request that
    this committee include funds in fiscal year 2000 budget in the amount
    of $2.4 million for these purposes.
        The Port of Liberty Commission also supports an appropriation of
    $4.756 million for the completion of the Wallisville Saltwater Barrier.
    The Wallisville project includes among its facilities a navigation lock
    that will facilitate navigation on the lower river during low flow
    conditions.
        We appreciate all of the fine work this committee has done for
    interests in the lower Trinity River area over the years, and request
    your support for federal maintenance and construction projects in our
    area.
                                     ______

    Prepared Statement of Gale Wm. Fraser, II, P.E., General Manager/Chief
             Engineer, Clark County Regional Flood Control District
        Presented herewith is testimony in support of a $35,000,000
    construction appropriation necessary for the U.S. Army Corps of
    Engineers to continue the Tropicana/Flamingo Washes flood control
    project and testimony to support $2,105,250 reimbursement to the non-
    federal sponsors, Clark County and the Clark County Regional Flood
    Control District, for work performed in advance of the federal project
    pursuant to Section 211 of the Water Resources Development Act (WRDA)
    of 1996. This project is located in the rapidly growing Las Vegas
    Valley in Southern Nevada.
        The Las Vegas Valley has experienced unprecedented growth over the
    past twenty-five years and all signs indicate that this growth will
    continue for several more years. People have moved into the area from
    all parts of the nation to seek employment, provide necessary services,
    and become part of this dynamic community. It is estimated that 5,000
    people relocate to the Las Vegas Valley every month of the year.
    Currently the population is over 1.2 million. The latest statistics
    show that nearly 30,000 residential units are built annually. Once all
    these factors are combined, the result is that the Las Vegas Valley is
    one of the fastest growing areas in the nation.
        The Federal project proposed by the Corps of Engineers (Corps) is
    designed to collect flood flows from a 160 square mile contributing
    drainage area. The plan identified in the Corps' Feasibility Study for
    the Tropicana and Flamingo Washes Project includes four debris basins,
    four detention basins, 28 miles of primary channels, and a network of
    lateral collector channels. The debris basins are designed to collect
    flood flows from undeveloped areas at the headwaters of the alluvial
    fans and trap large bedload debris before it enters the channels and
    causes erosion damage. The detention basins will function to greatly
    reduce the magnitude of the flood flows so that the flows can be safely
    released through the developed urbanized area at non-damaging rates.
    The outflow from the debris basins and the reduced flows from the
    detention basins will be contained in the primary channel system which
    will also serve as outfalls for the lateral collector channels. While
    this latter element is considered to be a non-federal element of the
    entire plan, it is a necessary element for the plan to function
    properly. Because flow over the alluvial fans which ring the Las Vegas
    Valley is so unpredictable in terms of the direction it will take
    during any given flood, all of the components of the Corps' plan are
    critical.
        The Feasibility Report for this project was completed in October
    1991, and Congressional authorization was obtained in the WRDA of 1992.
    The first federal appropriations to initiate construction of the
    project became available through the Energy and Water Resources
    Development Appropriations Bill signed into law by the President in
    October 1993. The Project Cooperation Agreement was fully executed in
    February 1995. Appropriations to date have totaled $71,045,000, which
    has allowed for the continued implementation of the project. The total
    cost of the project is now estimated at $266,000,000, primarily due to
    the delay in anticipated federal appropriations.
        Certain elements of the Corps' plan have already been constructed
    by the local community but require modifications in order to fit into
    the Corps' plan and fulfill the need for a ``total fan approach'' to
    the flooding problems of the Las Vegas Valley. The Red Rock Detention
    Basin was constructed by Clark County in 1985 and modifications by the
    U.S. Army Corps of Engineers were recently completed in December 1996.
    The release from the basin has been reduced and its capacity to hold
    flood waters were enhanced, thereby increasing the level of downstream
    protection provided by this feature. Although this was the first
    feature completed, the immediate benefit realized was the removal of
    approximately five square miles and 4,754 parcels from the alluvial fan
    flood zones.
        The non-federal sponsors also constructed the Upper Flamingo
    Detention Basin. This facility was completed in February 1992, and is
    one of the main components of the program. Under the Corps' plan, the
    releases from this feature will also be reduced and its storage
    capacity increased. We have been working with the local development
    community in an effort to have them remove the excess sand and gravel
    from the impoundment area of this facility. Our goal is to have local
    contractors remove this surplus material for their own use at no cost
    to either the federal or local governments, thus providing a
    significant cost savings to the total project as well as maintaining
    the construction schedule.
        As local sponsors for this important flood control project, both
    the Clark County Regional Flood Control District and the Clark County
    Public Works Department anxiously anticipate the construction start of
    each feature of this project.
        Details of the Administration's fiscal year 2000 Civil Works Budget
    Request indicate that $20,100,000 is proposed for the continued
    construction of this project. The Los Angeles District of the U.S. Army
    Corps of Engineers informs us that their capability for fiscal year
    2000 is $40,000,000. Funding at the $35,000,000 level will allow the
    project to begin to return to the schedule as originally envisioned
    when the Project Cooperation Agreement was executed. Furthermore,
    funding at this level will allow: completion of construction of the
    Tropicana Outlet Channel, Lower Red Rock Complex, Las Vegas Beltway
    Channel (Section 10A), Blue Diamond Detention Basin; and the start of
    construction for the Flamingo Diversion Channel and R-4 Debris Basin
    and Channel. The non-federal sponsors are anxious to see these flood
    control facilities installed. Any further delays places portions of the
    federal project, and non-federal projects, both at risk.
        In 1996, the Regional Flood Control District was notified by the
    District Engineer of the Los Angeles District, U.S. Army Corps of
    Engineers, that due to reduced federal budget expenditures, expected
    and subsequent years of anticipated federal funding would be greatly
    reduced. The delay in funding, in the fastest growing community in the
    nation, will mean increased costs due to lost opportunities and
    inflation. The net result of the reduction in funding is currently
    expected to delay the completion of the project from year 2001 to year
    2006, a five-year delay.
        In order to provide the required flood protection in a timely
    fashion, the non-federal sponsors are implementing certain features in
    advance of the federal government by pursuing the provisions of Section
    211 of the WRDA 1996. An amendment to the Project Cooperation Agreement
    to implement Section 211 of the WRDA 1996 is in its final review
    stages. It is anticipated that the amendment will be approved within
    the next two months. Further, Section 211(f) of the WRDA 1996
    identifies this project as one of eight projects in the nation, to
    demonstrate the potential advantages and effectiveness of non-federal
    implementation of federal flood control projects. To date the non-
    federal sponsors have designed and constructed features at Russell
    Road, Valley View Boulevard, Dewey Drive, and Decatur Boulevard; and
    designed the Las Vegas Beltway (Section 7A), which the federal
    government has constructed, and Las Vegas Beltway (Section 7B, 8 and
    9). The work performed pursuant to Section 211 of the WRDA 1996 totals
    approximately $2,807,000. Therefore, the reimbursement for the federal
    share is estimated at $2,105,250. The non-federal sponsors are
    continuing to pursue the design and construction of additional features
    with the primary purpose of providing flood protection in as timely a
    fashion as possible at an estimated additional cost of $28,000,000.
    While the non-federal sponsors are not asking to be reimbursed the
    federal proportionate share at this time, the non-federal sponsors ask
    that the committee support the execution of the amendment to the
    Project Cooperation Agreement that institutes the language in Section
    211 of the WRDA 1996 for this project.
        This is an important public safety project designed to provide
    flood protection for one of the fastest growing urban areas in the
    nation. We ask that the committee provide the Secretary of the Army
    with $35,000,000, the Corps of Engineers' capability in fiscal year
    2000, in order to allow the U.S. Army Corps of Engineers to continue
    the design and construction of additional phases of this desperately
    needed flood control project.
        As the committee is aware, proactive flood control is the
    investment required to prevent loss of life and damages. Flood control
    is a wise investment that will, in the long run, pay for itself by
    preserving life and property and reducing the probability of repeatedly
    asking the federal government for disaster assistance. Therefore, when
    balancing the federal budget, a thorough analysis should prove that
    there will be substantial future federal savings in disaster assistance
    that will warrant the continued level of funding through Civil Works
    Budget appropriations.
                                     ______

      Prepared Statement of George Renner, President, Board of Directors,
                  Central Arizona Water Conservation District
        The Central Arizona Water Conservation District (CAWCD) is pleased
    to offer the following testimony regarding the fiscal year 2000 Energy
    and Water Development Appropriations Bill.
        The Central Arizona Project or ``CAP'' was authorized by the 90th
    Congress of the United States under the Colorado River Basin Project
    Act of 1968. We thank the Committee for its continuing support of the
    CAP. The CAP is a multi-purpose water resource development project
    consisting of a series of canals, tunnels, dams, and pumping plants
    which lift water nearly 3,000 feet over a distance of 336 miles from
    Lake Havasu on the Colorado River to the Tucson area. The project was
    designed to deliver the remainder of Arizona's entitlement of Colorado
    River water into the central and southern portions of the state for
    municipal and industrial, agricultural, and Indian uses. The Bureau of
    Reclamation (Reclamation) initiated project construction in 1973, and
    the first water was delivered into the Phoenix metropolitan area in
    1985. The CAP delivered over 1 million acre-feet of water to project
    water users in 1998 and anticipates delivering 1.4 million acre-feet in
    1999.
        CAWCD was created in 1971 for the specific purpose of contracting
    with the United States to repay the reimbursable construction costs of
    the CAP that are properly allocable to CAWCD, primarily water supply
    and power costs. In 1983, CAWCD was also given authority to operate and
    maintain completed project features. Its service area is comprised of
    Maricopa, Pima, and Pinal counties. CAWCD is a tax-levying public
    improvement district, a political subdivision, and a municipal
    corporation, and represents roughly 80 percent of the water users and
    property taxpayers of the state of Arizona. CAWCD is governed by an
    elected 15 member Board of Directors from each of the three counties it
    serves. CAWCD's Board members are public officers who serve without
    pay.
        Project repayment is provided for through a 1988 Master Repayment
    Contract between CAWCD and the United States. Reclamation declared the
    CAP water supply system (Stage 1) substantially complete in 1993, and
    declared the regulatory storage stage, or Plan 6 (Stage 2), complete in
    1996. No other stages are currently under construction. Project
    repayment began in 1994 for Stage 1 and in 1997 for Stage 2. To date,
    more than $489 million of CAP construction costs have been repaid to
    the United States.
        CAWCD and Reclamation disagree about the amount of CAWCD's
    repayment obligation for CAP construction costs. This dispute is the
    subject of ongoing litigation in United States District Court in
    Arizona. In Phase One of the litigation, which was completed in 1998,
    the District court ruled that CAWCD's construction cost repayment
    obligation for CAP Stages 1 and 2 under the 1988 Master Repayment
    Contract was limited to no more than $1.781 billion. In addition, the
    court prohibited Reclamation from denying CAWCD the use of project
    facilities. Phase Two of the litigation addressed Reclamation's cost
    allocation procedures for CAP. Trial of Phase Two was completed in
    December 1998, but the court has not yet issued a ruling.
        In its fiscal year 2000 budget request, Reclamation is requesting
    $27,326,000 for the CAP. Of this amount, $11,153,000 is requested for
    the construction of Indian distribution systems, and $2,220,000 is
    requested for completion of construction of sulfur dioxide scrubbers at
    the Navajo Generating Station (NGS). The balance, $13,953,000, is
    sought for other CAP activities, many of which would be partially
    reimbursable by CAWCD if the repayment ceiling had not been exceeded.
    Reclamation estimates that $8,810,000 of the $27,326,000 would be
    subject to partial reimbursement resulting in a $6 million increase in
    total reimbursable costs.
        Reclamation's Project Repayment Appendix to the fiscal year 2000
    budget justification documents indicates that a ``residual'' amount of
    $401,535,392 is currently not covered under the repayment contract as
    ruled by the court in Phase One of the CAP repayment litigation and may
    not be repaid to the Federal Treasury. While CAWCD has challenged the
    adequacy of Reclamation's cost allocation procedure from which this
    residual amount was derived, we are concerned that Reclamation's budget
    request would result in an additional $6 million of reimbursable costs
    for which no repayment contract presently exists. In addition, CAWCD
    questions Reclamation's authority to spend CAP appropriations in the
    absence of an amendatory contract to cover repayment of the
    reimbursable portion. CAWCD has met with Reclamation and has offered to
    amend its repayment contract to cover an appropriate share of
    Reclamation's cost overruns, provided that CAWCD's repayment obligation
    is reduced by an appropriate amount to reflect the value of CAP water
    which has been transferred from non-Federal to Federal uses since the
    1988 Master Repayment Contract was signed. Reclamation has rejected
    these offers. Thus, CAWCD believes it has no repayment responsibility
    for any further funds Congress may provide that would otherwise have
    been characterized as reimbursable.
        Of the total $27,326,000 requested, $3,237,000 is earmarked to fund
    activities associated with implementation of a 1994 biological opinion
    of the U.S. Fish and Wildlife Service (FWS) pertaining to delivery of
    CAP water to the Gila River Basin. These funds are requested for
    construction of fish barriers ($2,612,000), payments to FWS for non-
    native fish eradication and native fish conservation ($500,000),
    Reclamation's non-contract costs ($100,000), and public information
    program ($25,000). Litigation brought by a local environmental
    organization remains unresolved, and it is likely that it will be at
    issue for some time. CAWCD continues to believe that Reclamation should
    cease spending in this area until the pertinent issues are resolved.
    For the past three fiscal years, Congress has cut all funding for these
    activities; however, Reclamation continues to spend other CAP
    appropriations for these purposes. In fact, language in the Conference
    Report regarding the fiscal year 1999 Energy and Water Development
    Appropriations Bill provided specific direction to the Secretary of the
    Interior not to spend any current or previously appropriated funds for
    this program. Yet, Reclamation's spending continues. As in prior years,
    CAWCD recommends that Congress not appropriate funds in fiscal year
    2000 to support any Reclamation activities under the 1994 Gila River
    Biological Opinion issued by the FWS.
        CAWCD continues to support appropriations necessary to ensure
    timely completion of all CAP Indian distribution systems. However,
    Reclamation's fiscal year 2000 budget request of $11,153,000 for CAP
    Indian distribution systems is less than half of the FY1999
    appropriation for this item. Reclamation has indicated to CAWCD that
    the fiscal year 2000 funding request will be sufficient to maintain
    current development schedules, but CAWCD is concerned that the reduced
    funding request is an indication that Indian distribution systems are
    being delayed.
        CAWCD also supports the continuation of funding for the Tucson
    Reliability Division. The requested $150,000 will allow planning work
    to continue and will assist Tucson in developing and implementing a
    plan including adequate reliability for putting its CAP water
    allocation to use.
        Finally, CAWCD supports increased funding for Reclamation's West
    Salt River Valley Water Management Study. Reclamation's South/Central
    Arizona Investigations Program includes a $200,000 line item to support
    a continuing planning effort to study the integration and management of
    water resources in the West Salt River Valley, including the use of CAP
    water. CAWCD supports increasing this line item to $400,000 for fiscal
    year 2000.
        CAWCD welcomes this opportunity to share its views with the
    Committee, and would be pleased to respond to any questions or
    observations occasioned by this written testimony.
                                     ______

           Prepared Statement of George Miller, Mayor, City of Tucson
        The people of Tucson greatly appreciate the funding support your
    Committee has given over the years to the Central Arizona Project. A
    crucial element of Tucson's planning for long-term reliance on CAP
    water has been the provision of delivery reliability for Southern
    Arizona through the construction of a storage reservoir and related
    facilities as part of the Project. This feature of the Project is
    commonly known as Terminal Storage. In the past five years, quality
    problems with CAP water have caused the City to suspend direct delivery
    of the water to customers. However, the City is taking steps to resolve
    those problems. Until these problems are resolved, the City will be
    storing CAP water underground and recovering it for delivery to
    customers in lieu of direct delivery. Even after the problems with the
    treatment and direct delivery of CAP water are resolved, the City will
    not be able to shift to direct deliveries unless it is assured that
    delivery of CAP water will be reliable.
        I am writing to urge that the Bureau's ongoing environmental,
    design and planning work for Terminal Storage be continued--so that the
    City can be assured of CAP delivery reliability to assist the City in
    maintaining direct delivery of CAP water as a future option. The Bureau
    has requested that $150,000 be appropriated for the Bureau's ongoing
    environmental and planning work for Terminal Storage. The City supports
    the Bureau's request and urges that the requested funds be included in
    the fiscal year 2000 appropriation so that our City can be assured of
    CAP delivery reliability as the City works to shift its water supply
    from groundwater to CAP water. We understand that the Central Arizona
    Water Conservation District has no objection to this request because
    Terminal Storage repayment is not included in the current contract
    repayment ceiling of $1.781 million.
                          background re cap in tucson
        Until the arrival of Colorado River water through the CAP aqueduct
    in late 1992, Tucson was one of the largest metropolitan areas in the
    United States wholly dependent upon groundwater. Since the early 1900s,
    Tucson has been forced to mine groundwater--withdraw more groundwater
    than is naturally replenished to the basin--to provide water to its
    growing population. Recognizing the finite nature of the groundwater
    resource, Tucson committed in the 1970s to a strong conservation ethic.
    Over the years this has resulted in significant reductions in per
    capita groundwater use. Nonetheless, current demands for water in this
    basin exceed renewable supplies by a ratio of nearly two to one.
        For many decades, Tucson has been a major supporter of the Central
    Arizona Project to import Colorado River water to the metropolitan
    areas of the state. Tucson recognizes that CAP water will be the most
    viable long-term water source to sustain Tucson's economic and
    population growth, meet the Arizona groundwater code requirements, and
    conserve and preserve the City's groundwater resource for the future.
    In 1988, the City entered into a subcontract for 148,420 acre feet of
    CAP Municipal and Industrial water, the largest CAP M&I subcontract in
    the state.\1\ Tucson is paying the annual capital charges on this water
    and in 1999 will pay nearly $7 million to the Central Arizona Water
    Conservation District in capital charges.
    ---------------------------------------------------------------------------
        \1\ In recent years the Town of Oro Valley and the Metropolitan
    Domestic Water Improvement District (MDWID) have become water
    providers. The service areas of both entities were included in Tucson's
    service area when CAP allocations were made, since the City, in the
    Northwest Area Agreements, had contracted to provide CAP water for
    these service areas. Recently the City, as part of a settlement of
    litigation over MDWID's obligations under the Northwest Area
    Agreements, transferred to MDWID 9,500 acre feet of the City's CAP
    entitlement. An additional amount of CAP entitlement may in the future
    be transferred to the Town of Oro Valley in connection with the
    settlement of the obligations of Oro Valley and the City under the
    Northwest Area Agreements. Consequently, both MDWID and Oro Valley also
    have concerns over the long-term reliability of CAP deliveries in
    Southern Arizona.
    ---------------------------------------------------------------------------
        In 1989, after a lengthy process of study and public input, Tucson
    adopted a long range Water Resources Plan. As part of that Plan, Tucson
    made a policy decision of rapid transition from mined groundwater to
    surface water, much earlier than required by Arizona's Groundwater
    Management Code. In preparing for the use of CAP water, Tucson shifted
    its economic resources from drilling new wells and maintaining the well
    fields, to reorienting the water delivery system, and to the
    construction of a large treatment plant capable of delivering
    sufficient treated CAP water to substitute renewable water for nearly
    all of the groundwater the City was delivering. Tucson invested over
    $160 million in the facilities required for reliance on CAP water.
        Unfortunately, when Central Arizona Project water arrived in the
    Tucson area, the interaction between treated surface water and old
    galvanized steel pipes in some portions of the city resulted in the
    delivery of discolored water to seven percent of our customers who
    received the water. Although major efforts were undertaken to correct
    the problem, progress was slow. In November 1995, the city's voters
    passed an initiative measure, Proposition 200, which bars Tucson Water
    from making direct delivery of CAP water unless it receives enhanced
    treatment to substantially reduce the total dissolved solids in the
    water. In 1997, a privately sponsored initiative attempted prematurely
    to convince the people of Tucson to allow resumption of direct delivery
    and was defeated at the polls.
        Consequently, Tucson is planning to recharge and recover a
    significant portion of its CAP water until the problems associated with
    direct delivery have been resolved. Because the direct delivery of CAP
    water has been delayed, questions have been raised concerning the need
    for Terminal Storage. A purpose of my testimony today is to assure you
    that Tucson plans to solve the water quality problems and in the long
    term to resume direct delivery of CAP water. Tucson needs Terminal
    Storage.
        Growth projections put the Tucson area's population at 1.2 million
    by 2025, and at 2.5 million 100 years from now. Tucson Water delivered
    approximately 115,000 acre-feet of water in 1997. Tucson Water's
    service area is projected to need approximately 170,000 acre-feet in
    2025, and nearly 250,000 acre-feet in the year 2100. Regional needs are
    even greater. Tucson's subcontract for CAP water is 138,920 acre feet.
    An additional 25,000 acre feet is allocated to private water companies
    and state land in the area. It appears that this area's current CAP
    allocations will be totally utilized by the year 2025.
        Tucson is, and must remain, committed to the Central Arizona
    Project to support the City's existing population as well as its future
    growth. I assure this Committee that Tucson's long-term commitment to
    the CAP remains intact, despite the water quality problems experienced
    by the City when it directly delivered CAP water to its customers.
    After describing these problems, I will address our support for
    $150,000 of the proposed appropriations for the Tucson Reliability
    Division of the CAP for fiscal year 1999.
                technical cap implementation problems in tucson
        Conversion of Tucson Water's service area population of nearly
    600,000 people from groundwater to surface water has been a significant
    challenge for the City. In order to comply with anticipated new
    stringent EPA requirements, Tucson constructed a state-of-the-art water
    treatment plant. We operated a pilot plant in Phoenix to identify and
    deal with the problems that could be encountered when CAP water was
    introduced in Tucson. A major public relations campaign was implemented
    to prepare our customers for the changes they might encounter when CAP
    water arrived. When the first 84,000 customers were transferred from
    groundwater to CAP water in early 1993, 7 percent of those customers
    experienced problems on a scale that had not been anticipated. The
    surface water caused encrusted materials in old galvanized steel pipe
    to break loose and resulted in the delivery of discolored water to
    approximately 6,000 customers. The City established a special office to
    deal with customer complaints and employed nationally recognized
    experts to help solve the problem. However, a quick solution could not
    be achieved, so the areas experiencing major quality were returned to
    groundwater deliveries.
        During 1994, the City continued to deliver treated CAP water to
    customers in areas with newer pipelines. However, after the CAP
    aqueduct was closed down in November and December, 1994 for siphon
    repair, the Mayor and Council decided that deliveries of treated CAP
    water would not be resumed to any customers until the problems with
    direct delivery were fully resolved.
        To assure that direct delivery of CAP water would not resume until
    the quality of the water improved, the voters of the city approved a
    citizens' initiative known as Proposition 200 in November 1995. It
    provides that CAP water cannot be directly delivered to Tucson Water
    customers unless the quality is equivalent to high quality groundwater
    in Avra Valley west of Tucson. Enhanced treatment will be needed if CAP
    water quality is to be improved to Avra Valley standards.
        In 1996 the City contracted with the Bureau of Reclamation to
    conduct pilot plant tests of enhanced treatment techniques and estimate
    costs. This study is not yet complete. Meanwhile the City is developing
    ways to continue to purchase CAP water and store it for future use. The
    Mayor and Council have been clear and united in continuing their
    commitment to taking substantial quantities of CAP water each year.
    However, the City must deal with the quality issues which have arisen
    because of the interaction between CAP water and the City's older pipe
    system. Economic consequences will include pipeline repair and
    accelerated replacement, costs for homeowner damages, and, as described
    above, the possible construction of a new enhanced treatment plant.
        We will preserve our basic conservation ethic, and our long-term
    need for CAP water to meet the needs of Tucson's growing population
    will continue. The CAP Use Study for Quality Water by Dames & Moore,
    completed in the Fall of 1996, reported on alternatives for utilization
    of the City's CAP allocation. Its long-term recommendation included
    direct delivery of substantial quantities of treated CAP water.
    Terminal Storage is critically necessary for such direct delivery.
        To address its problem with corroded pipes, the City is
    accelerating its main replacement program. More than half of the 200
    miles of old galvanized water pipes have been replaced. The City is
    also conducting a major new program to determine the level of water
    quality acceptable to our water customers and the methods for assuring
    that this level is maintained. A pilot program to deliver blended CAP
    and groundwater to volunteer neighborhoods is under way.
                                terminal storage
        The problems Tucson has had switching from groundwater to CAP water
    highlight the need for a storage facility near the terminus of the
    aqueduct--Terminal Storage, as the final element of the Central Arizona
    Project in Southern Arizona. A reliable supply of CAP water is very
    important to Tucson. It is also quite important to the Tohono O'odham
    Nation. The Nation has a contract for 37,800 acre feet of CAP water,
    and is to receive an additional 28,200 acre feet of water under the
    terms of the Southern Arizona Water Rights Settlement Act of 1982. This
    may also be CAP water. The Nation has urged that Terminal Storage be
    provided as part of the Central Arizona Project so that a reliable
    supply of water will be provided to the Nation and its people.
        The Bureau has been doing detailed planning and continuing the NEPA
    processes on a terminal storage proposal that has been approved by the
    City and the CAWCD board. The principal elements of the proposal are as
    follows:
        1. A 15,000 acre foot surface storage reservoir with 350 cfs
    gravity flow to the Tucson Water Treatment plant;
        2. Joint CAP recharge facilities with the CAWCD;
        3. Recovery of recharged water from: a. Two of Tucson Water's
    existing exterior wellfields, Avra Valley and Santa Cruz, with the
    flexibility to introduce flows either at the treatment plant or into
    the surface reservoir; and b. A new Central Avra Valley wellfield,
    located on City-owned property with the pumped supply introduced
    directly into the CAP canal on the discharge side of the Brawley
    Pumping Plant.
        4. Operation of the Tucson wellfields to be turned over to the
    CAWCD, under a cooperative agreement, during any CAP outages.
        The estimated cost of the federal portion of this project is $70
    million for the storage facility; the cost of the local portion is
    approximately $50 million for existing and new wellfields and
    pipelines. The draft Environmental Impact Statement for Terminal
    Storage was completed in April 1995. The final EIS was completed last
    year.
        We have urged the Bureau to continue the environmental work and
    planning for Terminal Storage and the Bureau plans to do so, albeit at
    a reduced level. Its appropriation request seeks $.12 million for work
    in fiscal year 2000 related to Terminal Storage. The City respectfully
    asks that this request be approved so that Terminal Storage can remain
    alive while Tucson resolves its CAP problems and develops its long term
    programs to return to direct delivery of CAP water.
                                     ______

     Prepared Statement of Bernadine Boyd, President, Fort McDowell Tribal
                    Council, Fort McDowell Indian Community
        On behalf of the Fort McDowell Indian Community [Community], I
    request that the sub-committee appropriate a supplement to the fiscal
    year 2000 budget for the Bureau of Reclamation in the amount of $3.2
    million, representing the cost of environmental mitigation associated
    with a loan pursuant to the Small Reclamation Projects Act, 43 U.S.C.
    Sec. 422a [small project loan], authorized and funded as part of the
    Community's 1990 water settlement.
                       the fort mcdowell water settlement
        As part of the Community's 1990 water settlement, Congress directed
    that the Secretary provide the Community a $13 million small project
    loan, to be repaid at no interest over a fifty year period. Id.,
    Sec. 408(e). The Congress further provided that, ``The Secretary [of
    Interior] is directed to carry out all necessary environmental
    compliance . . .'' and further ``authorized to be appropriated such
    sums as may be necessary to carry out all necessary environmental
    compliance associated with this settlement, including mitigation
    measures adopted by the Secretary.'' Id., Sec. 410 (a) & (b). To date,
    the environmental mitigation required by the Secretary as part of the
    small project loan has been undertaken largely by and at the expense of
    the Community. The Congress has not appropriated funds necessary to
    allow the Secretary to assume these burdens. That is the purpose of
    this request.
        During the negotiations leading to the 1990 water settlement, the
    Community made it clear that it required wet water, not simply a paper
    water right: that is, the practical ability to deliver the necessary
    water for full development of the reservation. The Community's water
    budget was based on this principle. Most importantly for present
    purposes, the federal cost sharing in the settlement was as well. In
    correspondence between the Community and the Department, the Community
    laid out its proposal regarding federal cost sharing as follows: the
    Community required sufficient funding to enable it to beneficially use
    its entire water budget; the Community determined those costs to be
    approximately $38 million, in consultation with its engineer and
    agricultural economists; the Community agreed to the $13 million small
    loan for its agricultural development and agreed to apply that amount
    against development costs, resulting in the Community's proposed
    development fund of $25 million. In the final settlement, the State of
    Arizona contributed $2 million to the development fund and the United
    States contributed $23 million. Id., Sec. 408.
        Clearly, the development anticipated through the small project loan
    at the time of the settlement was a key component of the overall
    settlement. As stated in the Community's testimony in support of the
    bill, the small project loan was expected to develop approximately
    1,600 acres of the reservation. Once finalized, the loan application
    showed development of 1,584 acres, with state of the art drip
    irrigation for permanent crops.
            environmental mitigation costs of the small loan project
        At the time of the settlement, the parties anticipated little, if
    any, environmental mitigation would be required as part of the small
    project loan. The Secretary was directed to undertake any required
    environmental mitigation and the Congress authorized appropriations to
    pay for such. However, these costs were not appropriated at the time
    since the nature and extent of environmental mitigation, if any, were
    unknown.
        As the project progressed, the Fish and Wildlife Service and Bureau
    of Reclamation [Bureau] required substantial environmental mitigation.
    Two of these mitigation requirements imposed obligations with
    significant negative economic impacts on the Community.
        First, before land clearing for the project began, six significant
    cultural (archaeological) sites were identified by the Bureau
    archaeologists. These sites could have been cleared for development
    through excavation recovery. To avoid the substantial delay in the
    project this would cause and the substantial cost of excavation to the
    Bureau, the Bureau proposed and the Community agreed to simply avoid
    these sites. These six sites are now fenced off and are surrounded by
    developed fields. The irrigation system is built around these sites but
    does not include them. Principally because these sites were excluded,
    the total acreage developed by the project is 1,357, rather than the
    1,584 expected at the time of the settlement.
        At the time the cultural sites were fenced, it was estimated that
    mitigation of the sites by excavation would have cost approximately $3
    million. Recently, the Community obtained an estimate from
    Archaeological Consulting Services, Ltd., for the excavation and
    recovery of these cultural sites. Their more current estimate shows
    that the cost could now exceed $9 million. The Secretary saved
    literally millions by avoiding the sites rather than excavating them.
    However, the effect of this approach was to impose mitigation related
    costs on the Community. Even if the Secretary were to undertake the
    excavation of these sites now, the cost to place those sites into
    development would be prohibitive. It would require redesign of the
    entire project and the extension of laterals within these isolated
    pockets. For all practical development purposes, these sites are now
    isolated and forever lost to the Community.
        Second, for the project to move forward, the Bureau and Fish and
    Wildlife Service required biological or habitat mitigation. Because it
    simply took the project lands out of desert habitat, the Community was
    obliged to set aside other land as desert habitat. The Bureau could
    have set aside land off reservation for this purpose. Instead, the
    Bureau required that the Community set aside 330 acres of Verde River
    front property on the reservation as permanent desert habitat in 1992.
    This 330 acres cannot be developed or even used by Community members.
    The Community recently obtained an appraisal of these 330 acres, which
    showed a market value of $4.9 million.
        Apart from the obvious costs to the Community summarized above,
    these steps for environmental mitigation have affected overall value of
    the project to the Community as well. As a result of the environmental
    mitigation, the project is reduced in size from 1,584 acres to 1,357
    acres. The Bureau has worked with the Community to identify additional
    reservation land that can be developed to make up for this acreage
    shortfall. However, these replacement lands are class III lands, much
    lower quality and productivity than the class I lands that were
    withdrawn from the project for environmental mitigation purposes. In
    addition, these substitute class III lands have higher development
    costs. An additional $1.9 million, over and above the original $13
    million loan, will now be required to place these substitute lands into
    development.
        Even more disturbing is the reduction in the expected economic
    benefits from the project. Under the project as originally approved in
    1990 (1,584 acres in development with no environmental mitigation costs
    imposed on the Community), the Community expected an internal rate of
    return of 6.6 percent. As the project now stands, there are 1,357 acres
    developed, with $4.9 million in costs for habitat mitigation, resulting
    in an internal rate of return of less than 2 percent.
        Clearly, this is not the bargain struck by the Community in the
    1990 water settlement. By reducing the developed acreage, the Community
    has fallen short of the full development goal upon which the settlement
    was premised. By imposing the environmental mitigation burden on the
    Community rather than the Secretary, the economic value to be derived
    from the developed acreage is dramatically reduced. In fact, the
    combined environmental mitigation costs and obligations imposed on the
    Community may actually exceed the present value of the loan.
                  the appropriation proposed by the community
        As the project neared completion last February, the Community
    presented this problem to the Department of the Interior. The Community
    made a proposal to the Department that, in its view, would place the
    Community roughly in the position contemplated at the time of the water
    settlement. Specifically, the Community proposed that the Department
    forgive repayment of the small project loan. This would, in turn, have
    released an escrow account of $1 million, plus interest, that was set
    aside by the Community in 1990 to guarantee repayment of the loan. The
    Community proposed to complete the project to the full 1,584 acres with
    its own funds, a cost now estimated at $1.9 million. Finally, the
    Community proposed that restrictions on the 330 acre habitat mitigation
    area be lifted, in favor of regulation by Community under its own land
    use plan that restricts development on a much larger part of the
    reservation. Significantly from the Community's point of view, the
    Community land use plan does not restrict members' use of the area, as
    does the present restriction.
        The Department studied the Community's proposal for months and
    informally decided that, for technical budgetary reasons, it could not
    solve the problem administratively. Although the Department
    acknowledges its responsibility for environmental mitigation under the
    water settlement act, Congress must appropriate the funds authorized by
    the act so that the Department can fulfill its responsibility.
        The Community proposes that its original proposal to the Department
    be implemented through an appropriation for the environmental
    mitigation costs already authorized in the water settlement. The
    Community believes these costs can be calculated as follows:
      --$3.2 million is a conservative estimate of the direct costs to the
            Community of environmental mitigation: the Community proposes
            to pay the $1.9 million necessary to complete the project to
            1,584 acres; the Community will also suffer a long term
            reduction in the value of the project because of the
            substitution of class III for class I lands, estimated at $1.3
            million (calculated by subtracting present value of project as
            originally approved from present value of project as completed
            with substitute lands, or $8.735 million minus $7.474 million
            calculated at 6 percent interest; these calculations reflect a
            delay in achieving full benefits as well as a reduction in
            annual crop benefits);
      --$3.2 million also approximates the present value of the $13 million
            small loan repayment, using an interest rate of 6 percent;
      --Congress should appropriate $3.2 million to the Bureau of
            Reclamation, as representing the reasonable costs of
            environmental mitigation, with direction that the Bureau use
            the appropriation to close out the Community's small loan and
            forgive repayment, thereby lifting all Bureau restrictions and
            responsibility for the project, subject of course to full
            payment of any unused portion of the original $13 million to
            the Community for use in completing the project;
      --with the small loan closed out, the escrow account held by the
            Community to guarantee repayment will be closed, which funds
            can be dedicated, along with other necessary Community funds,
            to complete the project to the originally contemplated 1,584
            acres;
      --with the small loan closed out, all restrictions imposed on
            reservation land by the Department as part of the loan must be
            lifted, with the 330 acre habitat mitigation area reverting to
            the Community's land use plan.
        These steps will place the Community in the same approximate
    position as that anticipated at the time of the settlement--sufficient
    funding to apply its full water budget to beneficial use. The
    circumstances here arguably support direct monetary compensation to the
    Community, in light of the Department of the Interior's failure to
    comply with its obligation to assume responsibility for all
    environmental mitigation under the water settlement. However, the
    Community does not propose that here. Rather, the Community proposes
    that funding representing the Community's costs of environmental
    mitigation be appropriated for the Bureau so that the Bureau can close
    out the loan. Done any other way, the United States' costs will be much
    higher and the final completion of the project, up to the anticipated
    1,584 acres, will be greatly delayed.
        The Fort McDowell water settlement was a turning point for the
    Community. The irrigation project funded by the small project loan has
    been constructed and 86,000 pecan and citrus trees have been planted.
    The reservation has literally begun to bloom as these permanent crops
    reach fruition. By any measure, the water settlement in general and the
    small project loan in particular are successful. With this
    appropriation, the final touches will be put on the settlement and the
    United States and the Community can be proud of the result. As always,
    the Community appreciates your support and wishes to thank the Arizona
    congressional delegation in particular for its efforts on the
    Community's behalf.
                                     ______

        Prepared Statement of Carol W. West, Executive Director, Tucson
                             Regional Water Council
        The Tucson Regional Water Council (TRWC) thanks you for the
    opportunity to provide testimony concerning the Bureau of Reclamation's
    fiscal year 2000 budget request. TRWC is a non-profit organization in
    Tucson, Arizona whose members are water providers, business and
    professional people, and concerned citizens dedicated to ensuring a
    long-term stable, quality water supply for Tucson and the surrounding
    region. Our members appreciate the Committee's long support of the
    Central Arizona Project (CAP), and we owe a debt of gratitude to you
    and your colleagues for your years of dedication to this project.
        TRWC wishes to address the specific Bureau of Reclamation budget
    line item: Tucson Reliability Division, which refers to system
    reliability to utilize CAP water. In view of the importance to the
    Tohono O'odham Nation, the towns of Marana and Oro Valley, Metropolitan
    Domestic Water Improvement District, and the City of Tucson, TRWC
    requests that the Committee support the Bureau's small request for
    funding ($150,000) in the fiscal year 2000 bill.
        There is widespread recognition among regional water providers that
    the Tucson area will eventually find it necessary to directly utilize
    CAP water for municipal purposes. The present move to recharge much of
    the CAP water has been in response to customer dissatisfaction with the
    initial treatment and delivery provided by Tucson Water. However,
    recharging all the CAP water will not efficiently supply municipal
    needs for the long-term.
        Extensive testing conducted over the past five years shows that the
    problems experienced by water users in 1992-94 can be avoided with the
    proper pH adjustment and the addition of the corrosion inhibitor
    polyphosphate. A voluntary neighborhood demonstration project sponsored
    by the City of Tucson will be implemented shortly to show that a blend
    of groundwater and recharged CAP water can produce water of acceptable
    quality. The next logical step is to demonstrate to the community that
    a blend of groundwater and properly treated CAP water is also an
    acceptable, and more affordable option.
        TRWC believes that providing reliability for the Tucson region is
    critical to completing the Central Arizona Project and reducing
    reliance on our dwindling groundwater supplies. Unless this region has
    system reliability, it cannot achieve the most efficient uses of its
    CAP allocations . . . not for municipal uses or other uses such as
    mining. Direct utilization requires a stable and sure supply, and
    funding the Bureau of Reclamation's request will enable the agency to
    continue efforts to provide our region with the reliability that will
    be vitally needed.
        TRWC respectfully requests that this specific Bureau of Reclamation
    budget line item Tucson Reliability Division be approved. Thank you for
    your serious consideration of this request.
                                     ______

           Prepared Statement of Skip Rimsza, Mayor, City of Phoenix
        On behalf of the City Council and the residents of Phoenix, the
    sixth largest city in the country, I would like to present the
    following testimony. I am pleased to present this testimony in support
    of appropriations to help our city and region continue to foster a
    partnership with the federal government to achieve our shared
    objectives. We have been working with our delegation, this Committee,
    the Corps of Engineers, the Bureau of Reclamation, and other federal
    agencies to promote environmental restoration and flood control needs
    in the most effective and economical way. We sincerely appreciate the
    past support of this Committee and trust we will continue our
    partnership to see several critical projects through to a successful
    conclusion.
        There are three initiatives under way which this Committee has
    supported in the past and are included in the President's Budget.
    Continued support is essential to achieve the public benefits for which
    the projects are being designed.
                       rio salado and rio salado phase ii
        We have been working for nearly five years with the Corps of
    Engineers in a cost-shared partnership to study a project to restore
    riparian wetlands along the Salt River in downtown Phoenix and Tempe.
    The wetlands were lost over many years as a result of diversion of Salt
    River flows for irrigation of the surrounding region.
        In cooperation, the Corps, the City of Tempe, and we have developed
    a cost-effective plan called Rio Salado to restore about seven miles of
    the lost riparian wetlands. The plan has been approved by the Secretary
    of the Army and the Administration and was included for authorization
    in the Senate passed Water Resources Development Act of 1998. Even
    though the House did not act on the bill, we are hopeful that Congress
    will pass a WRDA 99 that will include authorization for the Rio Salado
    project. In the meanwhile, preconstruction engineering and design is
    continuing.
        The Rio Salado project is the centerpiece of our efforts to
    revitalize the environment and the economy of a part of our city that
    has not enjoyed the fruits of progress as have other parts of the city.
    The President's budget request is both sufficient and essential to keep
    this project on schedule. We urge you to support the appropriation of
    $1,545,000 for design of the Phoenix section of the project and the
    $100,000 for the Tempe section. We also seek $100,000 to begin Rio
    Salado construction subject to WRDA 1999 authorization. This funding is
    critical if the Corps is to accelerate its schedule and begin to
    contract construction in late fiscal year 2000.
        The Rio Salado Phase II portion of this environmental restoration
    project was included in the Corps of Engineers Reconnaissance Study in
    1996 which led to the Rio Salado project. It is essentially a
    continuation of the Rio Salado project and would connect the Rio Salado
    project either to Tempe or to Tres Rios. We are seeking $200,000 for
    the Corps to begin the feasibility study of this portion of the project
    which will determine if the project moves upstream or downtstream in
    the next phase. Completion of the study and construction of the project
    would make much of the corridor whole. We strongly urge your support
    for this appropriation.
                                   tres rios
        This is a truly unique project the outcome of which holds promise
    to benefit the entire nation as well as the Phoenix region in
    particular. The Bureau of Reclamation has constructed a demonstration
    project, which uses wastewater from the regional wastewater treatment
    plant to create wetlands near the discharge location. The Corps of
    Engineers is studying expansion of those wetlands and the Bureau is
    looking at ways to reuse the wastewater once again for groundwater
    recharge in the Agua Fria River after it has flowed through the
    wetlands. The demonstration project to date has exceeded all
    expectations.
        It is critical that we continue this project at full pace. The
    President's Budget includes $486,000 for the Corps to complete its
    feasibility study to expand the demonstration project and $50,000 to
    begin preconstruction engineering and design. We believe this is
    sufficient for the Corps.
        The Bureau's budget contains $400,000 for its share of the effort,
    which we support. We are seeking an additional $200,000 to allow the
    Bureau to begin studies on the Agua Fria River groundwater recharge
    portion of the project. This work should be undertaken under the
    separate authority for a Metropolitan Phoenix Water Reclamation and
    Reuse project under section 1608 of the Bureau's Title XVI Reclamation
    and Reuse Program. It is important to have that portion of the study
    completed in about the same time frame as the rest of the study and
    design work to avoid losing the water coming from the wetlands
    restoration project.
                      gila river, northeast drainage area
        This is another innovative study designed to anticipate potential
    flood control problems from the rapidly expanding development on the
    alluvial plains in the Northeast section of the greater Phoenix area.
    The results of the study will allow local jurisdictions to plan and
    regulate development in a coordinated way throughout the region to
    avoid creating flooding problems as has happened in many other rapidly
    growing areas in the nation. We believe that spending a little time and
    planning effort now will reap large savings in flood control costs and
    flood damages in the future. The Corps budget contains $342,000 for
    this study that we believe is enough to keep it on schedule.
                                    summary
        All three projects, Rio Salado with its Rio Salado Phase II
    extension, Tres Rios, and the Gila River, will act in synergy to
    restore lost environmental quality and provide for creative management,
    conservation, and reuse of scarce water quantities in the Phoenix
    metropolitan area. In summary, we are requesting that you retain
    $1,645,000 for the Rio Salado project ($1,545,000 for the Phoenix reach
    and $100,000 for the Tempe reach), add $100,000 in construction funds
    for Rio Salado, include $200,000 to extend the Rio Salado study to
    Phase II, that you retain the $486,000 for the Corps of Engineers
    feasibility study of the Tres Rios project and $50,000 for Corps
    preconstruction engineering and design, that you include $400,000 for
    the Bureau's portion of Tres Rios, and that you include $200,000 for
    the Bureau to proceed with the groundwater recharge study at the Agua
    Fria.
        We sincerely appreciate the opportunity to present this request and
    thank you very much for your courtesy and consideration. We would be
    pleased to provide any additional information you may need.
                                     ______

      Prepared Statement of Jack A. Barnett, Executive Director, Colorado
                       River Basin Salinity Control Forum
                    colorado river salinity control program
        This testimony is in support of funding for the Colorado River
    Basin salinity control program. Congress has designated the Department
    of the Interior, Bureau of Reclamation (Reclamation), to be the lead
    agency for salinity control in the Colorado River Basin. This role and
    the authorized program were refined and confirmed by the Congress when
    Public Law 104-20 was enacted into law. A total of $17,500,000 is
    requested for fiscal year 2000 to implement the needed and authorized
    program. Failure to appropriate these funds will result in significant
    economic damage in the United States and Mexico and threaten compliance
    with adopted basin-wide water quality standards in the future. The
    President's request of $12.3 million is a level funding request and the
    Forum appreciates this Administration's support of the program.
    Nonetheless, studies have shown that implementation of the program has
    fallen behind the needed pace to prevent salinity concentrations from
    exceeding numeric criteria adopted in connection with water quality
    standards for the River Basin while the Basin states continue to
    develop their Compact apportioned waters of the Colorado River.
    Concentrations of salts in the water above the criteria would cause
    hundreds of millions of dollars in damage in the United States and
    result in poorer quality water being delivered by the United States to
    Mexico. For every 30 mg/l increase in salinity concentrations, there is
    $100 million in additional damages in the United States. The Forum,
    therefore, believes a rate of implementation of the program beyond that
    requested by the President is necessary.
        The program authorized by the Congress in 1995 has proven to be
    very successful and very cost effective. Proposals from the public and
    private sector to implement salinity control strategies have far
    exceeded the available funding. Hence, Reclamation has a backlog of
    proposals and is able to select the best and most cost-effective
    proposals. Funds are available for the Colorado River Basin states'
    cost sharing at the level requested by the Forum. Water quality
    improvements accomplished under Title II of the Colorado River Basin
    Salinity Control Act also benefit the quality of water delivered to
    Mexico. Although the United States has always met the commitments of
    the International Boundary & Water Commission's (Commission) Minute 242
    to Mexico with respect to water quality, the United States Section of
    the Commission is currently addressing Mexico's request for better
    water quality at the Southerly International Boundary. Consideration of
    all of this argues for a higher level of funding than requested by the
    President.
                                    overview
        The Colorado River Basin Salinity Control Program was authorized by
    Congress in 1974. The Title I portion of the Colorado River Basin
    Salinity Control Act responded to commitments that the United States
    made, through Minute 242, to Mexico concerning the quality of water
    being delivered to Mexico below Imperial Dam. Title II of the Act
    established a program to respond to salinity control needs of Colorado
    River water users in the United States and to comply with the mandates
    of the then newly legislated Clean Water Act. Initially, the Secretary
    of the Interior and the Bureau of Reclamation were given the lead
    federal role by the Congress. This testimony is in support of funding
    for the Title II program.
        After a decade of investigative and implementation efforts, the
    Basin states concluded that the Salinity Control Act needed to be
    amended. Congress revised the Act in 1984. That revision, while keeping
    the Secretary of the Interior as lead coordinator for Colorado River
    Basin salinity control efforts, also gave new salinity control
    responsibilities to the Department of Agriculture, and to a sister
    agency of the Bureau of Reclamation--the Bureau of Land Management.
    Congress has charged the Administration with implementing the most
    cost-effective program practicable (measured in dollars per ton of salt
    removed). The Basin states are strongly supportive of that concept as
    the Basin states consider cost sharing 30 percent of federal
    expenditures up-front for the salinity control program, in addition to
    proceeding to implement their own salinity control efforts in the
    Colorado River Basin.
        The Colorado River Basin Salinity Control Forum (Forum) is composed
    of Gubernatorial appointees from Arizona, California, Colorado, Nevada,
    New Mexico, Utah and Wyoming. The Forum has become the seven-state
    coordinating body for interfacing with federal agencies and Congress to
    support the implementation of a program necessary to control the
    salinity of the river system. In close cooperation with the
    Environmental Protection Agency (EPA) and under requirements of the
    Clean Water Act, every three years the Forum prepares a formal report
    analyzing the salinity of the Colorado River, anticipated future
    salinity, and the program necessary to keep the salinities at or below
    the levels measured in the river system in 1972.
        In setting water quality standards for the Colorado River system,
    the salinity levels measured at Imperial, and below Parker, and Hoover
    Dams in 1972 have been identified as the numeric criteria. The plan
    necessary for controlling salinity has been captioned the ``plan of
    implementation.'' The 1996 Review of water quality standards includes
    an updated plan of implementation. The level of appropriation requested
    in this testimony is in keeping with the agreed upon plan. If adequate
    funds are not appropriated, state and federal agencies involved are in
    agreement that the numeric criteria will be exceeded and damage from
    the high salt levels in the water will be widespread in the United
    States as well as Mexico and will be very significant.
                                 justification
        The $17,500,000 requested by the Forum on behalf of the seven
    Colorado River Basin states is the level of funding necessary to
    proceed with Reclamation's portion of the plan of implementation. This
    funding level is appropriate if salinity in the Colorado River is to be
    controlled so as not to exceed the established numeric criteria and
    threaten the associated water quality standards. In July of 1995,
    Congress amended the Colorado River Basin Salinity Control Act. The
    amended Act gives Reclamation new latitude and flexibility in seeking
    the most cost-effective salinity control opportunities, and it provides
    for proposals and more involvement from the private as well as the
    public sector. Early results are indicating that salt loading is being
    prevented at costs often less than half the cost under the previous
    program. Congress's recent review of the program and the amendments it
    authorized have made the program more effective in removing salt from
    the Colorado River in a most cost-effective manner.
        The Basin states have agreed to cost sharing on an annual basis,
    which adds 43 cents for every federal dollar appropriated. The Colorado
    River Basin Salinity Control Forum, working with EPA, has agreed upon a
    plan of implementation for salinity control, and that plan justifies
    the level of funding herein supported by the Forum to maintain the
    water quality standards for salinity adopted by the Basin states. The
    federally chartered Colorado River Basin Salinity Control Advisory
    Council, created by the Congress in the Salinity Control Act, has met
    and formally supports the requested level of funding. The Basin states
    urge the Subcommittee to support the funding as set forth in this
    testimony.
                         additional support of funding
        In addition to the dollars identified above for the implementation
    of the newly authorized program, the Salinity Control Forum urges the
    Congress to appropriate necessary funds, as identified in the
    President's budget, to continue to maintain and operate salinity
    control facilities as they are completed and placed into long-term
    operation. Reclamation has completed the Paradox Valley unit which
    involves the collection of brines in the Paradox Valley of Colorado and
    the injection of those brines into a deep aquifer through an injection
    well. The continued operation of the project and other completed
    projects will be funded through Operation and Maintenance funds.
        In addition, the Forum supports necessary funding, as identified in
    the President's budget, to allow for continued general investigation of
    the salinity control program. It is important that Reclamation have
    planning staff in place, properly funded, so that the progress of the
    program can be analyzed, coordination between various federal and state
    agencies can be accomplished, and future projects and opportunities to
    control salinity can be properly planned to maintain the water quality
    standards for salinity so that the Basin states can continue to develop
    the Compact apportioned waters of the Colorado River.
                                     ______

    Prepared Statement of Larry Libeu, President, Western Coalition of Arid
                                States (WESTCAS)
        The Western Coalition of Arid States (WESTCAS) is pleased to submit
    comments for the record, regarding programs contained in the U.S.
    Bureau of Reclamation's (Reclamation) fiscal year 2000 budget, for the
    hearing on Energy and Water Appropriations. WESTCAS is an organization
    of cities, towns, water and wastewater districts and associate agencies
    from the states of Arizona, California, Colorado, Idaho, Nevada, New
    Mexico, Oregon, and Texas and who are dedicated to environmentally
    conscientious planning of water resources and development of water
    quality standards for the unique ecosystems of the arid West. Of
    particular interest to WESTCAS and its member agencies are the federal
    programs that can further our goals through partnerships and
    scientifically sound regulation and guidance concerning our most
    precious resource--water.
                 colorado river basin salinity control program
        Since 1974, federal agencies and the seven basin states have been
    working together to maintain the Colorado River's salinity levels
    within a range which does not limit the economic, recreational, and
    environmental uses of the river. The Colorado River is a major source
    of water supply for the urban and agricultural regions of Utah, Nevada,
    Arizona, and Southern California. It is important that Congress
    continue to fund the federal portions of this successful program. With
    continued development of water sources in the Upper Colorado Basin and
    continued shortfalls in salinity control funding, the salinity levels
    will continue to increase in the Lower Colorado River Basin. The
    increased salinity in the Lower Colorado River Basin will have a long-
    term detrimental financial impact on agricultural and urban activities
    in the areas dependent on the Lower Colorado River water.
        The Colorado River Basin Salinity Control Forum (Forum), the
    interstate organization responsible for coordinating the Basin states'
    salinity control efforts, issued its 1996 Review, Water Quality
    Standards for Salinity, Colorado River System (1996 Review) in June
    1996. The 1996 Review found that additional salinity control was
    necessary beginning in 1994 to meet the numeric criteria in the water
    quality standards adopted by the seven Colorado River Basin states and
    approved by the U.S. Environmental Protection Agency, with normal water
    supply conditions. For the last four years, federal appropriations for
    Reclamation have not equaled the Forum-identified funding need for the
    portion of the program the Federal Government has the responsibility to
    implement. It is essential that implementation of Reclamation's
    basinwide salinity control program be accelerated to permit the numeric
    criteria to be met again under average annual long-term water supply
    conditions, making up the shortfall. To assist in eliminating the
    shortfall, the Forum once again recommends that Reclamation utilize up
    front cost sharing from the Basin states to supplement federal
    appropriations. This concept has been embraced by Reclamation and is
    reflected in the President's proposed budget.
        The President's proposed fiscal year 2000 budget contains funding
    of $12 million for implementation of the basin-wide program. WESTCAS
    requests that Congress appropriate $17.5 million for implementation of
    the basin-wide program, an increase of $5.5 million from that proposed
    by the President. This level of funding is necessary to meet the
    salinity control activities schedule in order to maintain the state
    adopted and federally approved water quality standards.
                    water recycling and groundwater recovery
        Projects funded under Title XVI of the Reclamation Projects
    Authorization and Adjustment Act of 1992 (Public Law 102-575) will
    greatly improve water supply reliability and the environment. Title XVI
    projects authorized by the Reclamation Recycling and Water Conservation
    Act of 1996 (Public Law 104-266), but not included in the President's
    proposed fiscal year 2000 budget for the U.S. Bureau of Reclamation,
    are considered to be equally important. Implementation of such projects
    is difficult without combined federal, state and regional assistance..
    These authorized projects will greatly improve water supply reliability
    and the environment through effective water recycling and recovery of
    contaminated groundwater in the arid west. WESTCAS strongly requests
    that Congress increase the appropriation level for Reclamation's Title
    XVI program from $31,514 million to $100 million in order to proper
    fund all of these authorized projects.
        WESTCAS supports the funding in the President's proposed fiscal
    year 2000 Budget for the following programs which are important to
    ongoing activities in our region:
                         efficiency incentives program
        Reclamation is encouraging innovation in water resources management
    to help meet the water conservation objectives of the Reclamation
    Reform Act of 1982. The program provides partnership capability for
    Reclamation and its customers, in cooperation with States and other
    entities, in seeking solutions to water use efficiency and
    conservation. The program supports technical assistance to districts in
    planning, evaluating, and implementing efficiency measures. Activities
    are located within all Federal water projects in the 17 Western States.
                   endangered species recovery implementation
        Reclamation is designated as a cooperative participant in recovery
    measures to minimize the potential effects of Reclamation actions upon
    listed or candidate species and reduce the potential for more stringent
    requirements being imposed upon Reclamation projects as a result of
    formal consultation pursuant to Section 7(a)(2) of the Endangered
    Species Act. Activities are located throughout the region including the
    Upper and Lower Colorado River basins.
                     national fish and wildlife foundation
        This program operates under a delegated grant of authority for fish
    and wildlife assistance programs from the Secretary to the Commissioner
    of the Bureau of Reclamation. Reclamation's funds are used for fish and
    wildlife restoration projects in partnership with local, state, tribal,
    and/or nongovernmental organizations. Funding for the Foundation, and
    the Foundation's support for programs like the Lower Colorado River
    Multi-Species Conservation Program, are extremely important to the
    development of comprehensive solutions to the complex endangered
    species issues.
                   desalination research development program
        This program addressees problems and technology needs for water
    supply augmentation, water quality improvement and protection. Studies
    are directed at reducing costs and minimizing environmental impacts
    from salt removal, developing commercially attractive technologies,
    improving surface and groundwater quality, and facilitating cost-
    effective conversion of previously unusable water resources to usable
    water supplies.
                     water management conservation program
        This program provides for a water quality monitoring program in
    cooperation with state and local entities. Funding requests provide for
    the coordination of water management and conservation efforts with the
    water users and other non-Federal entities. It also provides for water
    conservation centers and training, improvements in water measurement
    and accounting.
                          wetlands development program
        The Wetlands Development Program allows for the development of
    design criteria, strategies, and implementation of wetland enhancement
    projects which provide for water quality, wildlife habitat, and
    aesthetic purposes. Projects are located throughout the 17 Western
    States and include demonstration projects using reclaimed wastewater
    from existing treatment facilities in Arizona and wetlands and wildlife
    habitat in Nevada.
                   california bay-delta ecosystem restoration
        The Bay-Delta system provides habitat for fish and wildlife and is
    also critical to California's economy serving as the hub of
    California's water system, supplying more than two-thirds of the
    State's 32 million residents with a portion of their drinking water and
    irrigating 45 percent of the nation's produce. In September 1996, the
    President signed the California Bay-Delta Environmental Enhancement Act
    which authorizes $143.3 million per year in Federal funding for Bay-
    Delta ecosystem restoration activities in 1998, 1999, and 2000. Federal
    money for the Bay-Delta will fund an array of critical ecological
    improvements, including habitat restoration, watershed protection,
    fishery enhancement and water quality improvement.
        Recently your Subcommittee was provided with a report by the Bureau
    of Reclamation ``Annual Costs of Bureau of Reclamation Project
    Operation and Maintenance for Fiscal years 1993-97''. WESTCAS has not
    had the time to adequately review the report, however, several of our
    members have raised the issue for our Budget Committee to review the
    report because of the tight budget constraints their district's are
    confronted with and the possibility of having inappropriate costs being
    passed on in their own operating budgets. We will forward our comments
    on to your subcommittee in the near future and would ask that your
    subcommittee look further into the details contained in the report.
                                   conclusion
        Thank you for your consideration of our testimony. We believe our
    comments emphasize the importance of continued funding for Reclamation
    water resources management and ecosystem restoration programs that are
    critical for water supply reliability in the arid West.
                                     ______

                   PACIFIC NORTHWEST WATER RESOURCE PROJECTS
           Prepared Statement of the Northwest Power Planning Council
        The Northwest Power Planning Council appreciates the opportunity to
    submit written testimony in support of the Clinton Administration's
    fiscal year 2000 budget request for programs under the jurisdiction of
    the Energy and Water Development Subcommittee.
        The Council was established by Congress in 1980, and created as an
    interstate compact by the states of Idaho, Montana, Oregon and
    Washington. Its purpose is to develop a 20-year regional electric power
    plan to assure for the Pacific Northwest an adequate supply of power at
    the lowest possible cost, and to develop a major program to protect and
    rebuild fish and wildlife resources harmed by hydroelectric development
    in the Columbia River Basin. The Council carries out its
    responsibilities under the Pacific Northwest Electric Power Planning
    and Conservation Act of 1980 (Northwest Power Act), Public Law 96-501.
        Three federal agencies under the jurisdiction of the Subcommittee,
    the U.S. Army Corps of Engineers, Bureau of Reclamation, and the
    Bonneville Power Administration, administer programs critical to the
    Columbia River Basin. The Council works closely with all three agencies
    in fulfilling its statutory responsibilities.
                          u.s. army corps of engineers
    Columbia River Fish Mitigation Program
        The Council continues to support the Corps' Columbia River Fish
    Mitigation Program. The focus of the program is to reduce the mortality
    of both juvenile and adult salmon and steelhead during their migration
    through the projects and reservoirs comprising the Federal Columbia
    River Power System. The Corps' fiscal year 2000 budget proposal for the
    program is $100 million, and includes funding for several critical
    studies and activities that are crucial to recovering, rebuilding and
    maintaining the anadromous fish runs in the Columbia River Basin. The
    Council supports the Corps' full $100 million budget request.
        Significant amounts have been appropriated for the program for more
    than a decade, and a recent study by the National Marine Fisheries
    Service suggests that juvenile salmon survival through the four lower
    Snake River hydro projects and reservoirs has improved. Although the
    data has not been independently verified, NMFS scientists believe that
    survival conditions may have improved over pre-project conditions.
    While it remains unclear whether increases in juvenile survival through
    the Snake River projects leads to increases in adult returns, it is
    reasonable to assume that the installation and improvement of fish
    passage at the projects under the Corps' Columbia River Fish Mitigation
    Program will make the federal hydroelectric system less lethal.
    Accordingly, it is critical that the Corps' Columbia River Fish
    Mitigation Program be fully funded in fiscal year 2000 to ensure that
    the effort continues to make the mainstem Columbia and Snake rivers
    safer for juvenile and adult salmon.
    Council Review of the Columbia River Fish Mitigation Program
        In the Subcommittee's fiscal year 1998 Conference Report, a
    provision in the Joint Explanatory Statement was included directing the
    Council, with assistance from the Independent Scientific Advisory Board
    (ISAB), to conduct a review of the Corps' Columbia River Fish
    Mitigation Program. Given the magnitude of the task, the Council agreed
    with the ISAB's recommendation to conduct the review in three phases,
    including an overview of the entire Columbia River Fish Mitigation
    Program.
        The first phase dealt with the proposed installation of extended
    length bar screens at John Day Dam and the construction of a new
    juvenile bypass outfall at Bonneville Dam. The scientists believed that
    the small increases in survival to specific species from installation
    of the screens were not justified. The ISAB felt that limited funds
    should be used for ``pursuing existing surface spill alternatives and
    funding research toward possible deployment of a surface-flow bypass
    system'' at the dam instead of installing screens. Given the
    uncertainty identified by the ISAB on the benefits of screens, the
    Council has called for further research and testing of screen
    prototypes that take into consideration the scientists' concerns, prior
    to recommending any further major investments in screen installation at
    John Day Dam.
        In addition, at Bonneville Dam, the ISAB stated ``the high
    mortality inflicted upon juvenile salmon by predators at the present
    bypass outfall locations justifies relocation of the outfalls to
    locations and habitats where predation rates are expected to be
    significantly reduced.'' In addition to relocating the bypass outfalls,
    the scientists encouraged ``integrated, long-term planning and study of
    other planned alterations'' at Bonneville Dam. The Council transmitted
    the ISAB's report to the Subcommittee on July 1, 1998.
        In the ISAB's second phase report, the scientists reviewed the
    development and testing of surface bypass systems and the dissolved gas
    abatement program. The ISAB concluded that over 20 years of work to
    improve turbine intake screen technology has yet to result in a turbine
    intake screen that can achieve the 80 percent fish passage efficiency
    standard for all species and stocks. Therefore, efforts to develop
    other juvenile fish bypass alternatives that can achieve the 80 percent
    goal for all species and stocks should be pursued. Surface collection
    and bypass continue to show promise; however, the scientists caution
    that substantial uncertainties remain regarding the level and changes
    in survival of juvenile salmon that can be provided by surface bypass
    facilities. Given the uncertainty, the ISAB recommended that all
    juvenile passage alternatives be evaluated against the baseline of
    spill, since spill more closely mimics natural processes than any other
    bypass alternative. Spill should be considered the alternative when
    improvements anticipated from other bypass technologies do not meet
    passage goals. The Council continues to support the federal spill
    program for juvenile passage through the federal hydropower system.
        In its report on dissolved gas abatement, the scientific board
    concluded that the Corps' program is important for rectifying
    supersaturation of waters of the Snake and Columbia rivers, and that it
    should continue with high priority. Attainment of the Clean Water Act
    total dissolved gas standard of 110 percent throughout the hydropower
    system will be difficult under involuntary spill conditions with the
    majority of dams in place. The current program of modifications of dams
    to reduce gas supersaturation should have benefits to salmon and other
    components of the ecosystem, the scientists said. The Council
    transmitted the ISAB's second report to the Subcommittee on January 11,
    1999.
        The third phase of the ISAB's review addressed adult fish passage
    at the dams and also included an overview of the entire Columbia River
    Fish Mitigation Program. On March 2, 1999, the Council released the
    report to the public for review and comment. In this report, the ISAB
    concluded that the subject of adult passage at Columbia and Snake River
    dams has not been adequately dealt with, that returning adults to
    spawning grounds may be more important than juvenile survival, and that
    the Corps' planned site-specific measures may be supportable but
    probably are not sufficient to ensure that adult spawning migrations
    are unimpeded. The ISAB recommended that additional evaluation, field
    research, and capital projects will be needed to address the adult
    passage issues.
        Next month, the Council will review the comments submitted by the
    public and finalize a comprehensive report to Congress that will
    include not only the ISAB's findings, but also the Council's final
    recommendations to Congress on the program. We intend to transmit the
    final report to the Subcommittee no later than early May 1999.
        The Council has learned a great deal during this review process,
    both about the current configuration of the fish passage facilities at
    the federal dams on the Columbia and Snake rivers, and with regard to
    new principles and guidelines that should be considered by the Corps in
    planning additional passage improvements. Developing fish passage
    systems is not an exact science, but one that is continually evolving.
    As we increase our knowledge of the behavior patterns of anadromous
    fish, and river processes, and improve our understanding of the need to
    protect biodiversity, we will develop more effective fish passage
    alternatives. These alternatives likely will be implemented to benefit
    the range of species and stocks in the river, and may result in
    providing multiple passage solutions at individual projects. They also
    will reflect that the best passage solutions are those that take into
    account and work with the behavior and ecology of the species using the
    river system.
        The Council realizes that the Columbia River Fish Mitigation
    Program has enjoyed high funding levels for several years. Continuation
    of the program at its full capability is necessary to ensure that
    critical improvements to the system are implemented, and important
    studies and tests completed so that fish survival through the dams can
    continue to improve.
    Willamette River Temperature Control, Oregon
        The Willamette River Basin is located in northwestern Oregon.
    During the last 40 years, 13 Corps of Engineers reservoirs have been
    constructed in the basin to control floods, generate electricity and
    provide water for navigation, irrigation, improved water quality,
    recreation, and fish and wildlife. Studies over the last 15 years have
    demonstrated that the temperature at which water is released from these
    reservoirs is a key limiting factor for survival of anadromous and
    resident fish in the Willamette basin. Local, state and federal
    agencies, including the Council, have been seeking modification of
    water temperature in the McKenzie River downstream from Blue River and
    Cougar reservoirs to achieve more beneficial temperatures for wild
    spring chinook salmon, bull trout and rainbow trout. The Corps'
    feasibility study for the project was completed in 1995. An
    Environmental Impact Statement was completed, and a Finding of No
    Significant Impact was signed by the Division Commander on April 24,
    1996. In March of this year, Willamette spring chinook and winter
    steelhead were listed as threatened by the National Marine Fisheries
    Service under the Endangered Species Act; the last significant wild
    stock of spring chinook in the Willamette is in the McKenzie River. The
    current estimated cost to install multi-level intake towers at the two
    projects is $70.6 million.
        Due to cost limitations associated with the project's
    authorization, the Corps' current focus is on the Cougar Lake reservoir
    intake tower, which has a total estimated cost (including future
    inflation) of $50.077 million. In its fiscal year 2000 budget, the
    Corps is proposing Cougar Lake for a new construction start, and has
    requested $1.7 million in funding. The Council supports this project
    and the requested funding level, and urges the Subcommittee to include
    it in its fiscal year 2000 funding recommendations.
                             bureau of reclamation
        The Bureau is proposing to spend $11.734 million in fiscal year
    2000 on the Yakima River Basin Water Enhancement Project. The Council
    supports this project, which will employ structural and non-structural
    water conservation measures to increase the reliability of the
    irrigation supply and enhance streamflows in the Yakima River. In
    addition, Yakama tribal water supply facilities will be improved and
    tribal economic development, fish and wildlife, and cultural programs
    will be enhanced.
        The Council also strongly supports the Columbia and Snake River
    Salmon Recovery Project, which the Bureau is proposing to fund at
    $13.122 million for fiscal year 2000. The funds are used for important
    purposes in the Snake River Basin, such as acquiring water through
    leasing or on a willing-seller basis for flow augmentation to aid
    migrating salmon and steelhead, and to address Endangered Species Act
    requirements.
                        bonneville power administration
        The Bonneville Power Administration is the primary implementor of
    the Council's fish and wildlife program. In the fall of 1995, the
    Administration and Congress agreed on a fixed budget for Bonneville's
    fish and wildlife recovery efforts in the Columbia River Basin. Under
    the terms of that agreement, which was further defined and formalized
    in September 1997 in a memorandum of agreement signed by the
    secretaries of the Army, Interior, Commerce and Energy, Bonneville will
    incur costs, on average, of $435 million per year for five years on
    fish and wildlife activities. These funds fall under a number of
    different categories, including direct expenditures on fish and
    wildlife projects, power purchases, reimbursements of appropriated
    funds to the Corps of Engineers and the Bureau of Reclamation, capital
    repayment and foregone revenues. For fiscal year 2000, Bonneville
    estimates that its total fish and wildlife budget will be $403.6
    million.
        In the Energy and Water Development Appropriations Act for fiscal
    year 1997, the Committee added a new section, 4(h)(10)(D), to the
    Northwest Power Act, which requires the Council to appoint an 11-member
    Independent Scientific Review Panel (ISRP) to review fish and wildlife
    projects proposed to be funded through Bonneville's direct program. For
    fiscal year 2000, Bonneville expects to commit $100 million to its
    direct program, and use up to $27 million of its borrowing authority.
        The Council shares the Committee's objective that all fish and
    wildlife funds be spent judiciously after thorough independent
    scientific review. We are continuing to work with the region to fully
    and fairly implement the requirements of section 4(h)(10)(D), which
    will help ensure that Bonneville's ratepayers' funds are spent on
    projects that have the greatest value in recovering and providing
    mitigation for the Columbia River Basin's fish and wildlife
    populations.
        Thank you for this opportunity to share our views with you. We
    sincerely appreciate the thorough consideration that this subcommittee
    has given to the needs of the Pacific Northwest over the years.
                                     ______

       Prepared Statement of Glenn Vanselow, Executive Director, Pacific
                        Northwest Waterways Association
        Mr. Chairman and members of the Subcommittee: My name is Glenn
    Vanselow. I am Executive Director of the Pacific Northwest Waterways
    Association. We appreciate the opportunity to present our views on
    appropriations issues to the Committee. The PNWA membership includes
    nearly 120 organizations and individuals in Washington, Oregon and
    Idaho. PNWA represents public port authorities on the Pacific Coast,
    Puget Sound, and Columbia/Snake River System; public utility districts,
    investor-owned utilities, electric cooperatives and direct service
    industries; irrigation districts, grain growers and upriver and export
    elevator companies; major manufacturers in the Pacific Northwest;
    forest products industry manufacturers and shippers; and tug and barge
    operators, steamship operators, consulting engineers, and others
    involved in economic development throughout the Pacific Northwest.
        PNWA has a long history of working with the Committee and the U.S.
    Army Corps of Engineers (Corps) on projects of regional and national
    importance, sharing the challenge to maintain and develop our
    transportation infrastructure. Our members wish to thank the Committee
    for its support of Pacific Northwest transportation, hydropower and
    salmon enhancement programs and projects.
                             appropriations request
        Fiscal year 2000 Civil Works Budget.--The maintenance of channels
    and harbors serving all currently authorized Pacific Northwest deep
    draft and coastal ports is a top priority for PNWA. We urge Congress to
    provide sufficient funding to meet national needs for both operations
    and maintenance (O&M) and new construction. The Administration's fiscal
    year 2000 budget request for navigation O&M in Idaho, Oregon and
    Washington and the request for preconstruction, engineering and design
    for the Columbia River Channel Deepening appear to be adequate, but the
    request for new construction is not sufficient. We oppose the overall
    level of the request for civil works because it is provides inadequate
    funding for crucial Corps waterways programs nationwide. While the
    request of $3.9 billion for the Corps is on par with fiscal year 1999
    appropriated levels, the proposal would only fund inland navigation and
    flood control construction projects at about 50 percent of their
    optimal schedule. We believe that a level of funding closer to $4.7
    billion is needed to maintain the integrity of the civil works program.
    We strongly oppose the Administration's proposed Harbor Services Fund
    proposal. We believe Congressionally appropriated funding from the
    general treasury is the best and most appropriate way to meet both
    routine maintenance and unexpected dredging needs. We also oppose new
    taxes on National Oceanic and Atmospheric Administration services and
    plans for taxes to recover the cost of Coast Guard navigation services.
        We support continued federal funding for operations and maintenance
    to present authorized depths of federally authorized navigation
    channels at shallow coastal harbors in Oregon and Washington. We
    support the current method of funding new project starts.
        Regional Navigation Operations and Maintenance.--We would like to
    thank the Committee for its previous support of navigation O&M
    (operations and maintenance) in the region's shallow, deep draft and
    inland navigation system.
        Navigation is the least cost, most fuel efficient and least
    polluting mode of transportation. Navigation is the critical link that
    keeps the Northwest and the nation competitive in domestic and
    international trade and supports the commercial and recreational
    fishing industry. It provides significant numbers of jobs and other
    economic benefits both within the region and nationally. We support
    maintaining a strong federal role in planning, construction, operation,
    maintenance and funding of navigation on the inland waterways, deep
    draft ports and shallow draft ports. We ask the Committee for full
    funding for ongoing operations and maintenance (O&M) of the federally
    authorized navigation channels in the Columbia/Snake river system, the
    Oregon and Washington coastal ports and Puget Sound. Maximizing O&M is
    a cost-efficient means of fully utilizing the federal government's
    investment in channel operations.
        Some 20 percent of the employment in the Northwest states is
    directly related to international trade. Navigation projects are among
    the few federal programs that are analyzed to ensure that economic
    benefits exceed the costs. Eliminating these programs would not be
    cost-effective.
        Navigation Feasibility Studies and Construction.--We wish to thank
    the Committee for appropriating funds last year for feasibility studies
    on the Columbia River and in Puget Sound. We are opposed to the
    downward trend in funding included in the President's fiscal year 2000
    budget request.
        The Columbia River deep draft channel is the lifeblood of the
    Columbia/Snake River System, which serves shippers from more than 40
    states. To protect future growth and development of the River System,
    we ask the Committee to fund the requested $892,000 preconstruction
    engineering and design for the lower Columbia River Navigation Channel
    Deepening. This funding would pay for the federal government's share of
    work necessary to investigate improving the existing 40-foot navigation
    channel by increasing the channel depth to 43 feet. We support
    completing the feasibility study for channel improvements of the Blair
    Waterway Navigation Channel at Tacoma. We also support the
    Administration's $3.4 million request to complete construction of the
    East Waterway Channel Deepening at Seattle, which is proposed to be
    carried out during O&M dredging.
        Lower Columbia River Ecosystem Restoration.--PNWA encourages the
    Committee to appropriate $100,000 to begin a study that would focus on
    ecosystem restoration opportunities within the Lower Columbia River.
    The study is strongly supported by the Lower Columbia River Estuary
    Program, and the States of Oregon and Washington have jointly agreed to
    non-Federal sponsorship of the study.
        Portland Harbor Environmental Dredging Project.--PNWA encourages
    the Committee to appropriate $100,000 for the Corps to undertake a
    reconnaissance study for an environmental dredging project at Portland
    Harbor.
        Minimum Dredge Fleet.--We encourage the Committee to maintain the
    currently active hopper dredges operated by the US Army Corps of
    Engineers and to reject any additional future set-aside for private
    dredges. We oppose legislation that places artificial limits on the
    federal hopper dredges by directing increasing amounts of maintenance
    dredging to private dredges. Federal hopper dredge costs are
    artificially higher than necessary because of that set aside. We
    believe that Congress should reduce or eliminate the set aside to
    increase the efficiency of the Corps hopper dredges. We also encourage
    the Committee to find ways to make the Corps dredges less expensive to
    operate by examining recent increases in depreciation and plant
    increment payments.
        We believe that the presence of the federal dredges keeps bids for
    dredging work competitive and lower in cost. We are concerned that the
    low number of private industry bids for work in our region could force
    dredging costs higher were it not for the availability of the federal
    dredges.
        Operations and Maintenance of the Region's Hydropower System and
    the John Day Drawdown study.--We are concerned that the President's
    fiscal year 2000 Budget request for construction on the Bonneville Dam
    powerhouse phase II and The Dalles powerhouse is insufficient. We
    encourage the Committee to increase funding for the Bonneville
    powerhouse construction to $16.3 million. We also encourage the
    Committee to increase funding for The Dalles powerhouse construction to
    approximately $3.3 million. We support the President's requests for
    Operations and Maintenance at these and other regional projects.
        We have testified in previous years that we do not believe there is
    biological justification for drawdowns. Just this year, the National
    Marine Fisheries Service testified before the Northwest Power Planning
    Council that salmon smolt survival through the four dams on the lower
    Snake River (Ice Harbor, Little Goose, Lower Monumental and Lower
    Granite) is as high or higher than it was before those dams were built.
    It is also clear that drawdown would have serious economic impacts on
    the region and the nation. Drawdown would eliminate important
    authorized purposes on the system, including navigation, hydropower
    production and irrigated agricultural production. The committee also
    should be aware that we believe that drawdown would reduce the
    Bonneville Power Administration's revenue generating capacity and
    jeopardize BPA's ability to repay its debt to the US treasury after the
    next subscription process expires. The four lower Snake dams and John
    Day provide 20 to 25 percent of BPA's total energy production.
        Salmon Recovery Decision Authority and Funding.--First, we support
    efforts to establish priorities for funding and implementation of fish
    and wildlife recovery projects in the Columbia River Basin Fish and
    Wildlife Program. Second, we support selected salmon recovery actions
    such as improved and enhanced smolt transportation, surface collection
    and other smolt by-pass facilities, fish-friendly turbine programs and
    habitat restoration and protection. Third, we oppose funding to carry
    out Phase II of the John Day drawdown study, and we do not support
    funding to study drawdown of McNary. These programs and others are
    included in the Administration's $100 million budget request for
    Columbia River Fish Mitigation. We encourage the Committee to redirect
    the $5.5 million proposed for these studies toward fish recovery
    programs for which there is broad regional support.
        We support the Senator Slade Gorton's 1996 amendment to the
    Northwest Power Act, approved during consideration of the fiscal year
    1997 Energy and Water Appropriations bill, which establishes a panel of
    scientists to establish priorities for funding and implementation of
    fish and wildlife recovery projects in the Columbia River Basin Fish
    and Wildlife Program. We hope that this, with the Independent Economic
    Analysis Board, will result in programs that will provide maximum
    biological benefits to listed salmon stocks and are more cost-
    effective.
        Regional Governance.--The discussion about regional cooperation in
    developing salmon recovery objectives and programs in the Columbia
    Basin has been expanded significantly through the establishment of the
    Columbia Basin Forum, formerly known as the Three Sovereigns Forum. A
    memorandum of agreement establishing this new body was recently signed
    by the federal agencies, tribes and states. This process was created
    without consulting affected stakeholders, and the participants do not
    intend to include stakeholders in the consensus process. PNWA believes
    that effective fish and wildlife programs can be implemented without a
    new governance body. If a new management structure is necessary for
    addressing the Endangered Species Act, the Northwest Power Planning
    Council offers an appropriate model. Federal, state and tribal agencies
    and regional stakeholders should work cooperatively to develop
    solutions that maintain Congressional authority over navigation and the
    other authorized purposes of the federal projects and state authority
    over water and land use. If PNWA urges the Committee to support
    collaboration in the Columbia Basin within the existing authorities of
    the federal agencies, states and tribes, and, in the strongest terms
    possible, we urge Congress to retain exclusive authority over the
    authorized purposes of the federal projects within the Columbia Basin.
        Demolition of the former U.S. Army Corps of Engineers' Complex at
    Walla Walla.--We ask the Committee to appropriate $4.7 million to
    remove asbestos and lead paint and to tear down the former Corps
    complex at the Walla Walla Regional Airport, Washington.
        Columbia River Channel Designation, Interstate 5 Bridge between
    Vancouver and Portland.--We ask the Committee to appropriate $50,000 to
    designate a new navigation channel under the high span of the I-5
    bridge. We hope that this action will be authorized in the Water
    Resources Development Act of 1999. This new channel will connect to the
    existing channel upstream of the bridge, allowing for more efficient
    use of the Columbia River and the I-5 bridge for navigation and surface
    transportation.
        Hanford Cleanup.--We ask the Committee to continue to adequately
    fund the Department of Energy cleanup of 45 years of accumulated
    defense waste currently stored at the Hanford site. We recognize that
    defense waste cleanup is a long-term project that will be most cost
    effective and most rigorously pursued if Hanford is a viable, operating
    site. Therefore, we strongly urge the Committee to support a complete,
    ongoing Hanford scientifically and technologically based research and
    operations program in order to ensure long-term funding for waste
    cleanup. PNWA also supports a complete and ongoing scientifically and
    technologically based research and operations program, including the
    restart of the Fast Flux Test Facility for the joint missions of
    national defense and medical research and isotope production to meet
    the demands for more effective cancer treatments.
        Conclusion.--On behalf of nearly 120 members from throughout the
    Pacific Northwest, we thank the Committee for giving us this
    opportunity to review a number of issues important to the environmental
    and economic prosperity of our region.
                                     ______

      Prepared Statement of Merv George, Jr., Chairman, Hoopa Valley Tribe
        On behalf of the Hoopa Valley Tribe of California, I express our
    appreciation for the opportunity to submit testimony regarding the
    fiscal year 2000 Bureau of Reclamation (BOR) budget. A summary of our
    fiscal year 2000 funding request follows:
        1.Support Administration's position that existing laws provide
    authority to support Trinity River Division fish and wildlife
    management and restoration activities. Further, the Hoopa Valley Tribe
    supports the Administration's position that Central Valley Project
    Improvement Act (CVPIA) funds are authorized for expenditure in the
    Trinity River Basin.
        2. Request that $13,000,000 be provided for Trinity River fishery
    management requirements within the Trinity River Division of the
    Central Valley Project for continuing fish and wildlife management
    programs of tribal, state, federal and local entities and for the
    Comprehensive Co-Management Agreement between Hoopa Valley Tribe and
    BOR.
        3. Support proposed funding increase for the Klamath Project and
    request an additional $750,000 for the Karuk and Klamath Tribes.
        4. Request $150,000 from the General Activities Planning budget for
    a feasibility study for upgrading the Lewiston generator, and for
    Trinity River green sturgeon and Pacific Lamprey population studies.
        5. Support the Native American Affairs proposed budget and request
    an increase of $1,000,000 for additional assistance to Indian tribes.
                                   background
        The Trinity River in northern California is the largest tributary
    to the Klamath River, the second largest river system in California.
    Since time immemorial, the Klamath Basin provided sustenance to Native
    Americans of the region. The Klamath River Basin is the aboriginal
    territory of Hoopa Valley, Karuk, Klamath, and Yurok Tribes. Moreover,
    utilization of fishery resources of the Klamath River has been
    fundamental to the economic health of northern California providing
    viable recreational and commercial salmon fisheries. In 1963, BOR
    completed construction of the Trinity River Division of the Central
    Valley Project (CVP). The Trinity River Division currently provides an
    estimated fourteen percent of the total water yielded by the CVP.
        Shortly after completion of the Trinity Dam, and subsequent
    diversion of up to 90 percent of the stream flows at the diversion
    point (near Lewiston, California) from the Trinity River, the fishery
    began to decline. Through the 1980's, corresponding declines of up to
    80 percent of the salmon and steelhead populations occurred. In
    response to declines in Trinity fish stocks, the Secretary of Interior
    approved development of a flow evaluation study in 1981 to determine
    stream flow needs for fish restoration. Further, Congress recognized
    the seriousness of the problem, and enacted the Trinity River
    Restoration Act (Public Law 98-541, 1984) which, with subsequent
    amendments, authorized approximately $70,000,000 in an attempt to
    reverse the decline of the fishery resources within the Trinity River
    Basin. However, the downward trend in Trinity fish populations has
    continued as reflected by listing of coho salmon under the Endangered
    Species Act (ESA) (6 May, 1997) and proposed listings of steelhead and
    chinook fish stocks of the Klamath/Trinity Rivers.
        While much work has been accomplished to date, it is recognized
    that continued monitoring and research will be necessary to provide
    insight on status of resources, evaluation of restorative measures, and
    effective management recommendations for further restoration. Primary
    among the scientific achievements to date has been the development of
    in-stream flow criteria that quantify the benefits to salmonids of
    retained flows in the Trinity Basin. These criteria, developed over the
    entire course of the Restoration Program, provide a basis for the
    Secretary's flow decision, due in fiscal year 2000. The Secretary's
    Trinity River Flow Evaluation Study Report is now ready for printing,
    and the Environmental Impact Statement (EIS) is scheduled for
    completion by April, 2000.
        In spite of many years of research into Trinity River ecosystem
    processes, considerable uncertainty persists in regard to downstream
    impacts of water releases from Lewiston Dam. These uncertainties are to
    be addressed via an Adaptive Management Plan (AMP) under the direction
    of the Interior Secretary. Long-term monitoring and research are
    essential to the AMP: hypotheses underlying the Trinity River Flow
    Evaluation Study recommendations will be tested through research; and
    monitoring data will be used to measure how well river ecosystem health
    objectives are met.
                  narrative justification and funding requests
        1. The Tribe is in agreement with the Administration's legal
    conclusions contained in the fiscal year 2000 Budget Justification and
    Annual Performance Plan--Trinity River Division--that existing
    authorities provide ample justification for expenditures on fish and
    wildlife restoration within the Trinity River. The 1955 Act creating
    the Trinity River Division, Trinity River Fish and Wildlife Restoration
    Act as amended, and the Central Valley Project Improvement Act (CVPIA)
    mandate that the Department of the Interior restore and maintain fish
    and wildlife populations with CVP funds. Furthermore, Congress
    acknowledged the reserved fishing rights of the Hoopa Valley Tribe in
    the CVPIA.
        2. Funding Request for Fish and Wildlife Management--In January
    1998, agencies responsible for managing the Trinity River fishery
    resources determined that $13,000,000 was needed annually to fund
    comprehensive management within the Trinity River Basin in order to
    restore the fishery resources to pre-dam levels. The Hoopa Valley Tribe
    participated in the development of this management plan.
        Therefore, the Tribe requests that the Committee provide
    $13,000,000 for Fish and Wildlife Management and Development within the
    Trinity River Division budget.
        Further, the Tribe requests that the Committee continue support for
    the Co-Management Agreement between the Tribe and BOR at a level of
    $2,500,000 for implementation in fiscal year 2000. The requested
    funding would ensure the Tribe's involvement in water project
    operations planning, environmental impact analysis, hatchery
    investigations, fisheries management, and would accelerate resource
    restoration through unified, inter-governmental management actions.
        In its seventh year, the Co-Management Agreement between Hoopa and
    BOR has contributed not only to the fulfillment of the Federal trust
    responsibilities to Native Americans, but has also served to bring
    Federal, State, Tribal and local management agencies together into a
    constructive and cooperative forum for managing fishery and water
    resources within the Trinity River Basin.
        3. Support proposed funding increase for the Klamath Project and
    request an additional $750,000 for the Karuk and Klamath Tribes. Both
    Tribes are involved with the restoration and protection of Trust
    resources in the Klamath River including active technical and policy
    involvement in water quality and quantity studies designed to improve
    the health of the upper Klamath Basin ecosystem. Endemic suckers listed
    under the ESA in Upper Klamath Lake, as well as salmon and steelhead
    living in downstream areas would benefit from increased Tribal
    involvement.
        4. Request $150,000 from the General Activities Planning budget for
    a feasibility study for upgrading the Lewiston Hydro-power generator,
    green sturgeon and Pacific Lamprey studies. It is expected that the
    Interior Secretary's Trinity River permanent fishery flow decision will
    result in reduced diversions of Trinity River flows into California's
    Central Valley. While being greatly beneficial to Trinity River fishery
    resources and upholding the federal trust obligations to Indian tribes,
    the decision will likely reduce the amount of electricity generated
    from diverted flows. To compensate for this situation, the Tribe
    requests that $100,000 be provided from Reclamation's General
    Activities Planning budget for determining the feasibility of
    increasing the capacity of the Lewiston Powerhouse generators in
    anticipation of the increased releases to the Trinity River. An
    expected benefit of increased generation of electricity from the
    Lewiston powerhouse is the possibility of using its revenues to pay for
    future fish and wildlife restoration activities within the Trinity
    River Basin, thereby reducing long-term costs to the Federal
    Government.
        In addition, the Tribe requests that $50,000 be provided for
    conducting population and fish health studies for Trinity River green
    sturgeon and Pacific Lamprey, both of which are important species to
    the Klamath and Trinity River Indian tribes and have been negatively
    impacted by the construction and management of the Trinity River
    Division.
        5. Support the Native American Affairs proposed budget request and
    an increase of $1,000,000 for additional assistance to Indian tribes.
    The Reclamation Native American Affairs program has proven to be very
    beneficial to both the Federal Government and Indian tribes while
    trying to resolve inter-governmental water and fishery management
    issues. Without a doubt, the Native American Affairs Program has been
    instrumental in reducing the possibility of costly litigation and
    disputes between Reclamation and Indian tribes.
                              results anticipated
        Trinity Restoration Program: Effective restoration of fisheries,
    critical to the Hoopa Valley and Yurok tribes and the economic
    stability of the fishery dependent communities of northern California
    and southern Oregon, would be promoted through collective actions of
    the Trinity Restoration Program. Identification and implementation of
    specific remedies and monitoring of fishery trends are expected results
    of Restoration Program.
        While many on-the-ground achievements have already been realized,
    many critical elements have yet to be completed. Among the expected
    outcomes of the Program for 1999 is the completion of the Environmental
    Impact Statement to assist the Secretary with implementation of in-
    river flows required for full restoration of salmonid populations in
    the Trinity River as mandated under Public Law 102-575. The Secretary's
    fishery flow allocation decision, originally mandated for fiscal year
    1997, was delayed due to incomplete environmental documentation. It is
    now anticipated that completed environmental documentation shall be
    available to support the Secretary's Decision expected in fiscal year
    2000.
        Tribal/Reclamation Co-Management Agreements and Native American
    Affairs Program: The Co-Management Agreements will continue to assist
    in the coordination of Federal, State, Tribal and local activities
    (management and research) impacting salmon fisheries and salmon
    habitats of the Klamath and Trinity rivers. Accomplishments under this
    agreement in fiscal year 1997 included maintenance of data collection
    and analysis programs critical to the integrated management of the
    Klamath and Trinity fishery resources. Both Reclamation and the Tribe
    agree that a wise investment has been made in developing a
    comprehensive foundation for fishery restoration. This foundation
    includes on-the-ground restoration work, assembly of scientific data on
    fisheries and habitat, and the coordination across multiple
    jurisdictions affecting salmon survival. It is now important to insure
    that this investment provides the desired results of a fully restored
    Trinity River Basin.
        The General Activities Planning budget request will assist the
    Tribes, agencies and private interests to develop opportunities for
    compensating for the loss of electricity caused by increased Trinity
    River flows. The Green Sturgeon and Pacific Lamprey population and
    survival studies will provide basic information for development of
    long-term management programs for these species. While green sturgeon
    and Pacific Lamprey are important species to Indian tribes, and their
    maintenance is part of the Federal Government's trust obligations, lack
    of funding has prevented the development of management programs for
    these species.
                                   conclusion
        The Hoopa Valley Tribe's relationship with BOR has improved
    significantly in recent years; however, it is clear that the fishery
    management problems associated with the Central Valley Project and
    Klamath Project operations still persist. Resolution of these issues
    may only be assured through the continued commitment by the Tribe and
    BOR to ongoing co-management of these important resources.
        Again, I appreciate the opportunity to submit testimony regarding
    BOR's fiscal year 2000 budget. I am available to discuss these matters
    with you in more detail at your convenience. Thank you.
                                     ______

      Prepared Statement of William A. Brakken, Community Liaison/Central
                 Oregon Team Leader, Northwest Area Foundation
                     deschutes basin resources conservancy
        I understand that the Senate Appropriations Subcommittee on Energy
    and Water Development has an upcoming hearing pertaining to the
    Deschutes Basin Resources Conservancy (DRC) in Central Oregon. This
    seemed an appropriate time to share some information with you regarding
    the Northwest Area Foundation's past experience with the DRC, as well
    as our potential future relationship.
        As you may be aware, the DRC grew out of a collaborative planning
    effort initiated in 1992 by the Confederated Tribes of the Warm Springs
    Reservation and Environmental Defense Fund to improve instream flows
    and water quality in the Deschutes River. Ultimately, that initiative
    attracted the support of a large and diverse number of organizations
    and individuals throughout Central Oregon--many of whom are now
    represented on the DRC Board. The Northwest Area Foundation provided
    the bulk of financial support--$300,000 over three years--for this
    planning effort. We consider it to be among the most successful of our
    recent watershed planning and management grants.
        Recently the Foundation shifted the focus of our mission from
    short-term grantmaking to individual nonprofit organizations to working
    with entire communities in long-term partnerships of approximately 10
    years. We anticipate committing $150 million to only a dozen or so
    community partnerships in our eight-state region over the next decade.
    One of the first places we are exploring for a possible partnership is
    the regional community of Central Oregon. We were drawn to this region
    for a number of reasons. But one of the most significant was the
    promising model for regional collaboration that is currently being
    demonstrated by the DRC.
        We are particularly impressed with the quality and diversity of
    individuals that DRC has attracted to serve on its board of directors.
    During the past six months members of the Foundation's Central Oregon
    Team have met individually with more than 150 citizens of the region--
    most all of them identified through personal referrals. Judging from
    the number of referrals we received of people serving on the DRC board,
    and our meetings with many of those individuals, we can attest to the
    high caliber of the board, as well as its action-orientation. In fact,
    we are hopeful we can attract a similar caliber of individuals to a
    steering committee we will soon convene to help design our prospective
    partnership with the community.
        The specific goal of our community partnerships is to reduce
    poverty by encouraging better integration of the social, economic, and
    environmental facets of a community's development. To effectively
    accomplish this goal, we will need to work closely with local
    organizations focused on similar objectives, such as the Deschutes
    Basin Resources Conservancy. We commend their efforts to you, and hope
    you will support them in whatever way possible. That, in turn, will
    help us better leverage our potential investment in Central Oregon.
        Thank you for your consideration. Please feel free to contact me
    with any questions.
                                     ______

     Prepared Statement of Ron Nelson, Chairman, Deschutes Basin Resources
                                  Conservancy
                                    summary
        The Deschutes Basin Working Group, dba the Deschutes Basin
    Resources Conservancy (DRC), is a non-profit, private corporation
    established in Oregon in 1996. In September 1996, Congress enacted and
    the President signed Public Law 104-208, which included S.1662, the
    Oregon Resources Conservation Act. Section 301(h) (Division B, Title
    III) of Public Law 104-208 authorizes $1.0 million per year through
    2001. The DRC is limited to spending 5 percent of any appropriation on
    administration.
        In 1999, Congress appropriated $500,000 to the Bureau of
    Reclamation to support the DRC. The DRC is using these funds to
    implement projects to improve water quality and quantity in the
    Deschutes Basin. Water projects are crucial in the Deschutes Basin
    where steelhead and bull trout are listed as threatened and Fall
    Chinook are proposed for listing under the Federal Endangered Species
    Act.
        The DRC has supported eight demonstration projects in the Basin.
    From October 1998 to March 1999 the DRC has leveraged $272,180 of its
    funds to complete $777,680 in on-the-ground restoration projects. These
    projects include: piping irrigation district delivery systems to
    prevent water losses; securing instream water rights to restore flows
    to Squaw Creek; providing riparian fences to protect riverbanks;
    working with private timberland owners to restore riparian and wetland
    areas; and seeking donated water rights to enhance instream flows in
    the Deschutes Basin.
        The DRC is governed by a diverse group of directors from private
    and public interests from the region. It is a community-based,
    cooperative endeavor that believes economic progress and natural
    resource conservation need to work together to achieve success. The DRC
    seeks voluntary actions based upon contracts and compensation for
    property and services. The DRC does not seek, nor is it authorized, to
    impose regulatory mandates through legal or political action.
                               1999 drc projects
        Annual Water Leasing Program.--The DRC is working with water users
    in targeted areas for water rights donations or sales to improve
    instream flows. The program began November 1998 by meeting with each
    irrigation district manager to introduce the leasing program and the
    process for transfers. In early 1999 water rights holders were
    contacted requesting the user's water donation. This program enables
    water right holder to protect their water rights by leasing and
    improves Deschutes flows.
        Central Oregon Irrigation District Piping.--For the most part the
    irrigation canals in the Upper Deschutes Basin are unlined and have
    been dug in porous, volcanic soils, so water losses through percolation
    can be quite high over the long distances that irrigation water must
    travel from the point of diversion to the farms. The DRC and Central
    Oregon Irrigation District propose to install roughly 3,960 feet of
    pipe, an inlet structure, an outlet structure, four clean-outs and four
    diversion structures. COID figures to conserve .29 cfs or .57 an ac/ft.
    Projected over a 180 day period, this calculates to 102.6 ac/ft water
    conserved. One half of the conserved water from this project will be
    returned to instream flows in the Deschutes River. This project is an
    important demonstration of how water can be conserved to benefit both
    the irrigation district and its water users and the Deschutes
    ecosystem.
        Confederated Tribes of Warm Springs Riparian Fencing.--The DRC and
    the Confederated Tribes of the Warm Springs Indian Reservation of
    Oregon are partners on a project to protect riparian areas in the
    Deschutes Basin's Eagle Creek, Skookum Creek and the mainstem river.
    The project constructs fence for livestock exclosures, places cattle
    guards at road crossings and installs solar pumps to provide animals
    water away from the riverbank. One of the DRC's primary goals is to
    improve water quality. Healthy, functioning riparian areas are critical
    to improving water quality in the basin. Riparian vegetation provides
    fish and aquatic habitat, stream shading to reduce water temperatures,
    bank stability and a filter for nutrients and sediments entering the
    water. This project is especially important for the habitat of Bull
    Trout that are listed as threatened and Fall Chinook and steelhead that
    are pending listing under the Federal Endangered Species Act. This
    project involves voluntary cooperation by the tribal grazing group
    allottees. The Warm Springs Tribes are involved in various other
    projects to improve stream conditions both on and off the reservation.
    This project is a part of a larger effort to improve flows and water
    quality for fish and wildlife.
        North Unit Irrigation District Piping.--The DRC, North Unit
    Irrigation District, Bureau of Reclamation and Natural Resource
    Conservation Service are partners in a Water Conservation Grant Program
    project for the Deschutes Basin. These groups are providing funds to
    replace an open irrigation lateral with buried pipe. The project
    consists of installing approximately 20,235 feet of plastic pipe, with
    19 turnouts and related appurtenances. The delivered water will be
    pressurized due to the elevation difference between the inlet at the
    main canal and landowner outlets. This pipeline will provide irrigation
    for approximately 445 acres. This project will save water, improve
    energy efficiency and reduce operation and maintenance expenses. The
    project will annually save about 600 acre feet of water. The majority
    of the conserved water comes from eliminating seepage from the open
    lateral. Water will also be saved by reducing system management losses
    (carry water) and improving delivery to small land parcels. Standard
    measuring devices, flow meters or flow regulators will be utilized at
    all outlets. Use of flow meters on the larger outlets will improve on-
    farm irrigation water management because landowners can readily verify
    how much water they are currently using or have used to date. One half
    of the conserved water from the project will be returned to instream
    flows in the Deschutes River. This project is an important
    demonstration of how water can be conserved to benefit both the
    irrigation district and its water users and the Deschutes ecosystem.
    The pressurized system will reduce the pumping requirements for
    sprinkler irrigation systems to save energy. Most of the irrigated land
    served by this lateral is currently being sprinkler irrigated.
        Foley Creek Riparian Areas, Wetlands and Forest.--Foley Creek is
    one of the most significant steelhead spawning and rearing areas in the
    Deschutes Basin. The DRC, EDF and landowners, Ochoco Lumber, are
    working together to develop a forest management plan to improve
    riparian areas and wetlands in Upper Foley Creek. The project also
    includes an intensive timber vegetation inventory. This inventory will
    provide the foundation to construct a carbon assessment that meets
    Environmental Protection Agency criteria. This may result in carbon
    contracts and other types of commodity contracts for the landowner to
    protect this habitat and benefit financially. This project is a
    demonstration of how private sector market solutions can improve the
    Deschutes ecosystem.
                                   background
        In 1989, the Environmental Defense Fund (EDF) and the Confederated
    Tribes of the Warm Springs Reservation began a cooperative project to
    reconcile on-reservation ecological and economic conflicts. In late
    1992, the Tribes and EDF expanded the scope of the project to include
    the entire Deschutes Basin. It was agreed that the initial focus would
    be on river flows and water pollution. Flow-deficient stream reaches
    and excessive water pollutant loads could only be mitigated by
    identifying and reducing existing water diversions and pollution
    discharges. At the same time, a high value was placed on being ``good
    neighbors'' to other landowners and resources users within the Basin.
    Positive incentives for changes in resource uses were emphasized
    instead of costly and divisive political and legal conflicts. Solutions
    employing economic incentives, such as water rights and pollution
    allowance marketing, were introduced and experiences elsewhere in the
    West were reviewed.
        A key forum for this community dialogue, the ``Ad Hoc Deschutes
    Group'', was formed. The 14 member Ad Hoc Group had representatives of
    all economic sectors in the Basin. The irrigation community holds the
    most water rights and reservoir storage and therefore has the greatest
    impact among resource users on the pattern and amount of river flows.
    At the same time, water quality degradation stems from a diverse set of
    land uses driving non-point water pollution. An important part of the
    project was to assure that the federal interests in the Basin were
    addressed along with those of the tribes, resource users, and local and
    state governments.
        The Ad Hoc Group recognized the need for a private organization
    with ecosystem-determined goals and methods based on positive
    incentives, consensus, and local governance. Since approximately half
    of the Basin's land area is managed by federal agencies it was clear
    that such a private organization would need the capacity to partner on
    projects with the federal agencies to be truly ecosystem and basinwide
    in scope. In March, 1996, Senator Hatfield introduced S. 1662
    authorizing federal agencies to work with this private organization,
    known as the Deschutes Basin Working Group. Title III of the Oregon
    Resource Conservation Act of 1996, signed by the President in
    September, 1996, authorizes the following:
      --Federal agencies to work with the private Deschutes Basin Working
            Group, dba Deschutes Basin Resources Conservancy (DRC)
      --Secretaries of Interior & Agriculture to appoint DRC board members
            for 3 year terms
      --Federal participation with DRC in ecological restoration projects
            on federal and non-federal land and water with 50-50 cost share
      --Five year startup authorization of $1.0 Million a year federal
            fund; 50/50 cost share with DRC
      --Emphasize voluntary market-based economic incentives
        The Deschutes Basin Working Group, later to adopt an operating name
    of the Deschutes Basin Resources Conservancy (DRC), has the goal of
    implementing on-the-ground projects that enhance the quality of the
    region's natural resources and add value to its economy.
        Its board consists of nine members from the Basin's private sector;
    hydropower, livestock grazing, recreation/tourism, timber, land
    development, irrigation (2), environmental (2), and two members from
    the Confederated Tribes of the Warm Springs Reservation. In addition to
    the private board members there are two board members appointed from
    the Departments of Interior and Agriculture, two board members
    representing the State of Oregon, and four members representing local
    governments within the Deschutes Basin.
        The DRC will receive funds through tax exempt donations from
    individuals, businesses, and corporations, including philanthropic
    foundations, and from government agencies seeking project development
    assistance or collaboration. It will seek to develop income from direct
    sources such as fee-for-service.
     federal appropriations in fiscal year 2000 for the drc--an investment
    in central oregon, in federal agencies' future role and in river basin
                                   management
        The DRC has a foundation enabling it to make a substantial
    contribution toward meeting the region's economic and ecological
    challenges. The potential for the DRC to marshal significant and
    ongoing resources and cooperation is great. The engagement of private
    sector interests in the design, funding, and implementation of
    ecological restoration efforts is an important precedent to help
    relieve federal budgetary requirements under a variety of programs and
    responsibilities. The DRC's combination of private and local interests
    with those of the federal agencies provides an opportunity to explore
    the cooperative sharing of authorities and responsibilities. The DRC
    represents a new institutional approach to river basin management that
    will be applicable to other river basins throughout the nation,
    particularly in the western regions.
                                     ______

        Prepared Statement of Jan Lee, Executive Director, Oregon Water
                               Resources Congress
        Chairman Domenici and Members of the Subcommittee: Mr. Chairman,
    members of the subcommittee, I am Jan Lee, executive director of the
    Oregon Water Resources Congress (OWRC). The OWRC represents irrigation,
    water control, drainage and water improvement districts, private ditch
    and irrigation corporations, cities and counties, individual farmers
    and ranchers statewide as well as having agribusiness associates as
    members.
        I am writing to urge your support for the $18,366,000 included in
    the President's fiscal year 2000 Budget for the Bureau of Reclamation
    projects in the State of Oregon. The funding for these projects
    represents a valuable commitment to meeting the needs of our member
    organizations at a time when many are confronted with the problem of
    how to meet water delivery needs for their district populations while
    at the same time addressing environmental and Native American
    requirements. There are particular projects like the Deschutes
    Ecosystem Restoration program and the Klamath project in Southern
    Oregon that typify this balance.
        OWRC has a larger concern that the overall funding for the Bureau
    of Reclamation the past several years has not been adequate to address
    the backlog of projects in their program. We were greatly surprised
    that Congress cut the Bureau's Budget by 11 percent for fiscal year
    1999. The cuts in the Oregon Water management and Technical Assistance
    program, Efficiency Incentives program, Water Management Conservation
    Program and the Title XVI make it difficult for water users in the
    state to address the combination of water/environmental/Native American
    water resource issues.
        In addition to the proposed funding for Oregon projects in the
    fiscal year 2000 Budget, we would ask the Subcommittee to consider
    funding to move forward the Willow Lake Natural Treatment System Title
    XVI project in Salem, Oregon, a project that we support because of the
    agricultural component associated with the proposal. We would also ask
    that additional funding be included in the Efficiency Incentives
    Program for the Bend Feeder Canal in Bend, Oregon.
        I would also ask that the Subcommittee continue to look into the
    issues surrounding the report to the Subcommittee that the Bureau of
    Reclamation provided concerning annual costs associated with operation
    and maintenance for fiscal years 1993-1997. Our district's already have
    very tight budget constraints and are concerned with possibilities of
    having increased costs passed on that may have nothing to do with their
    projects.
        Thank you for considering our requests and we look forward to
    favorable action by the subcommittee.
                                     ______

              Prepared Statement of the McKenzie Watershed Council
        The McKenzie Watershed Council is an advisory body established in
    1993 with the purpose of helping to address management issues in
    Oregon's McKenzie River watershed and to provide a framework for
    coordination and cooperation among key interests. The mission of the
    20-member council is to foster stewardship of McKenzie Watershed
    resources, deal with issues in advance of resource degradation, and
    ensure sustainable watershed health, function, and uses.
        In March 1995, the Council, which includes a representative from
    the U.S. Army Corps of Engineers, agreed by consensus to support
    federal implementation of the Willamette River Temperature Control
    project. The U.S. Army Corps of Engineers has been authorized to
    evaluate and plan for the installation of temperature control
    structures in the McKenzie Watershed on the Cougar and Blue River
    projects. The recommended plan is to modify the projects by adding one
    multi-level, ported intake structure at each project. These structures
    will permit selective withdrawal of water from different elevations
    within the reservoirs to achieve preferred downstream water
    temperatures for anadromous and native fish species. The Cougar and
    Blue River projects are only a few miles above their respective river's
    confluence with the McKenzie River, so their influence on the McKenzie
    temperature regime is significant. The recommended plan is expected to
    produce an additional 16,700 spring chinook salmon annually in the
    McKenzie River watershed.
        Implementation of the Willamette River Temperature Control project
    takes on extra significance with the expected federal threatened
    species listing of the Upper Willamette spring chinook salmon. The
    McKenzie Watershed contains the last self-sustaining population of
    native spring chinook salmon in the Willamette system. Historically the
    McKenzie Watershed was the destination for 40 percent of the native
    spring chinook salmon passing above Willamette Falls. Obviously, the
    McKenzie Watershed will play a major role in the restoration of
    Willamette spring chinook salmon.
        Alterations to the water temperature regime of the McKenzie River
    have been cited by the Oregon Department of Fish and Wildlife as a key
    limiting factor for the production of spring chinook salmon. In
    addition to spring chinook, bull trout are listed as ``threatened''
    under the federal Endangered Species Act, and their status would be
    improved with a modified temperature regime.
        The McKenzie Watershed Council commends the Clinton
    Administration's funding request for construction of this critical
    temperature control device. However, this funding request does not do
    enough to protect the McKenzie River's spring chinook salmon. The
    Council supports increasing fiscal year 2000 construction funding to $5
    million, which will accelerate completion of this critical project. In
    addition, this funding level will provide the scheduling flexibility
    necessary to accommodate spring chinook salmon migration and spawning
    cycles. It is essential that construction activities be managed in a
    manner that will minimize impacts on salmon.
        Adequate funding for this project, which will assure timely
    initiation and proper management, will accelerate the recovery of the
    McKenzie spring chinook salmon population. In comparison to other
    recovery options such as aquatic habitat enhancement, temperature
    control is the most effective and least costly alternative for
    restoring fish populations. Implementation of temperature control
    structures on the Cougar and Blue River projects will complement other
    critical restoration efforts being completed by public and private
    stakeholders in the McKenzie Watershed and throughout the Willamette
    Basin.
                                     ______

       Prepared Statement of William Martin, Chairman, Tumalo Irrigation
                                    District
        Chairman Domenici and Members of the Subcommittee: Tumalo
    Irrigation District (TID) is writing to urge your support for their
    request of $2,000,000 in the Bureau of Reclamation's fiscal year 2000
    budget. This money would be used for the piping of the Bend Feed Canal.
    This work would be undertaken through the Bureau of Reclamation's
    Efficiency Incentives Program.
        TID is located in Bend, Oregon and diverts its water from the
    Deschutes River and from Tumalo Creek. The water diverted from the
    Deschutes River is transported through a rapidly urbanizing area in an
    open canal which is made of porous volcanic materials. A portion of the
    canal is already piped and TID proposes using this funding for piping
    the balance of the canal including the flume over Tumalo Creek.
        The piping of the Bend Feed Canal will cost approximately
    $4,000,000, half of which will be paid for by the Tumalo Irrigation
    District. This piping will save a minimum of 20 cubic feet per second
    (cfs). From this savings, TID proposes targeting a 5 cfs flow for the
    Tumalo Creek, which currently is dried up in low water years The
    remaining 15 cfs of old rights will be exchanged for TID's 1961 rights
    which will be put in stream. The piping project will not expand TID's
    irrigated acreage.
        This project will help reestablish Tumalo Creek as a spawning area
    for fish and contribute flow to the Deschutes River. These flows will
    help in meeting the water needs of the northwest fish on the threatened
    or endangered species list.
        Although TID is experiencing an abundant snow pack this year,
    district users remember the drought years. The water savings will help
    insure a more reliable delivery of water in years of short supply.
        This project is a continuation of TID's conservation plan. Over the
    last four years TID has spent approximately $2,500,000 on piping its
    canals, laterals and ditches. In addition to the $2,000,000 that will
    be provided under the cost-sharing for this project, TID will spend
    approximately $800,000 to replace two flumes and approximately $250,000
    to install a fish screen in the next year.
        TID is a small irrigation district and needs federal assistance for
    the completion of the effort to pipe the Bend Feed Canal. As population
    in the Bend urban area is occurring at a rapid pace, enclosing the
    canal with pipe will reduce the drowning risk of children, pets and
    wildlife. TID believes the project is beneficial to the public with its
    water savings and safety features, and will provide increased
    reliability to its users.
        The Tumalo Irrigation District appreciates the Subcommittee's
    consideration of this request for the Bureau of Reclamation's fiscal
    year 2000 budget.
                                     ______

       Prepared Statement of Mayor Donna Evans, City of West Jordan, Utah
        Mr. Chairman, thank you for providing the opportunity to testify
    before your Committee. My name is Donna Evans, and I am the Mayor of
    West Jordan, Utah. The purpose of my testimony is to request $1.65
    millionfor the federal share of the construction for the West Jordan,
    Utah Water Reuse Project and $700,000 to complete the feasibility study
    and the planning and design for the Jordan River Meander project to be
    constructed by the U.S. Army Corps of Engineers.
        The Water Reuse project has been authorized as part of Public Law
    104-266 amending the Reclamation Wastewater and Groundwater Facilities
    Act (Title XVI of the Reclamation Projects Authorization and Adjustment
    Act of 1992). The City has committed the 75 percent local share for the
    project and is prepared to proceed. The Corps of Engineers expects to
    finish the feasibility study in fiscal year 2000 and complete the plans
    and specifications for the project in the next fiscal year.
                        west jordan water reuse project
        This project is located in the City of West Jordan, Utah, with a
    current population of over 52,000 people. As a suburb of Salt Lake
    City, the City of West Jordan is experiencing rapid growth. Since 1986
    the water use in the City has increased over 55 percent to over 13,000
    acre feet per year. During the summer months, water use increases
    mostly as a result of lawn watering and other outdoor irrigation
    activities. Records indicate that the average daily flow may increase
    as much as 77 percent over average annual flow to a maximum daily water
    use rate of almost 20 million gallons a day.
        This project would consist of the construction of the facilities to
    treat and distribute reclaimed water for the irrigation of public and,
    possible, private properties. The reclaimed water would be obtained
    from the effluent of South Valley water reclamation facility, located
    in the City of West Jordan. Up to 7000 acre feet per year of water
    would be available to reduce the peak loading of the culinary water
    delivery system and supplies. The water would receive tertiary
    treatment and disinfection prior to distribution.
        Due to the rapid growth of not only the City of West Jordan, but
    also the entire Salt Lake Valley, water resources are now being taxed
    to their limits. Salt Lake County Water Conservancy District (SLCWCD),
    which wholesales water to over twenty different entities in the valley,
    is projecting reaching their current peak flow capacity in three years
    or less. West Jordan currently purchases forty to fifty percent of
    their water supplies from SLCWCD, most of which is during peak demand
    of summer. Reducing the peak loading of West Jordan would not only
    benefit the residents of the City, but also the rest of the customers
    of SLCWCD by delaying or reducing the costly upgrades to the wholesale
    delivery system of SLCWCD.
        Although such water reuse is already being accomplished in other
    areas of the country, it is a relatively new approach to water
    conservation in Utah. The State of Utah has recently passed regulations
    on the use of effluent from treatment facilities. All current discharge
    parameters of South Valley Reclamation Facility meet the State
    regulations for Type I uses. Type I use is that which ``where human
    exposure is likely.'' Additionally, the State Division of Water Rights
    has recently issued their opinion on how the rights to the effluent
    would be distributed. Although there is not yet an official ruling, the
    City has been assured by the State Engineer that whatever water the
    City contributes to the treatment plant and has the original water
    rights for, the City has a right to reuse that quantity of effluent.
        Following the initial feasibility study, the City would proceed
    with detailed plans and specifications for the required facilities.
    These facilities would include, but not be limited to the following:
    Diversion structure with sand and/or activated carbon filter beds;
    lined holding pond or reservoir; pumping facility with chlorination or
    other disinfection capabilities; booster pump station(s); distribution
    system; and metering and billing capability.
        For the most part, all facilities would be constructed on City
    property or right of ways. Some land may have to be shared with or
    purchased from South Valley Reclamation Facility. Disturbance of any of
    the properties would be minimal. The impact would be no greater than,
    and possibly less, than the installation of necessary utilities to
    serve the growing population.
        Initially, it is projected that the project would be delivering up
    to 1000 acre feet of water to over 300 acres of City parks, cemeteries,
    and athletic complexes. As the system is expanded, it could serve a
    number of commercial landscapes and eventually private properties. As
    aforementioned, the City could divert up to 7000 acre feet of water,
    with current water rights.
        With the continuing growth of the Salt Lake Valley and particularly
    that of the City of West Jordan, new water supply sources are being
    exhausted physically and financially. Over one third of all water
    consumed is for irrigation of developed landscapes. This project would
    put to beneficial use water which is now discharging directly into the
    Great Salt Lake. Additionally, the project would reduce the use of
    drinking quality water for irrigation purposes, making more available
    where potable water is more critical. The $1.65 million would be the
    full federal share for the entire project.
                          jordan river meander project
        The Corps and the City of West Jordan are working on an
    environmental enhancement project to restore the River's meander
    through the City to reduce the River's current scouring impacts caused
    by man-made changes to the River's channel. The project will restore
    the River to its natural meandering path through a 1.7 mile corridor in
    the City and relocate 48'' and 56'' sewer lines to an alignment further
    west of the River.
        The Salt Lake District Office of the Corps of Engineers reports
    that with the funding they hope to complete the feasibility study in
    early fiscal year 2000 and initiate the planning and design phases of
    the project next fiscal year. The Corps will need $700,000 in fiscal
    year 2000 ($130,000 to complete feasibility and $570,00 to begin
    planning and design). The total Jordan River Meander project, including
    construction, is $6.8 million.
        Thank you very much for your kind consideration of our requests.
    Water supply is essential to the quality of life in West Jordan, Utah
    as it is in most western cities. The Reuse project redirects and
    strengthens the City's new strategy in water conservation and long term
    water supply. The Jordan River is the historic and ecological center of
    our city and having it restored to a more meandering course will
    enhance the quality of life for our citizens and improve the natural
    environment for our wildlife. In both cases the help from you and your
    committee will have a major positive impact on the quality of life in
    our city for our citizens. Thank you for your help.
                                     ______

               Prepared Statement of The Dry Prairie Rural Water
        Dry Prairie Rural Water (DPRW) joins the Fort Peck Tribes in the
    request for funds to continue the planning of the Fort Peck Reservation
    Rural Water System in the amount of $447,000 from the Burec General
    Investigations Account. DPRW serves the off reservation portion of
    Roosevelt, Sheridan, Daniels and portions of Valley county. The funds
    requested to address pre-authorization planning of the DPRW system are
    $193,000.
        With the funds from fiscal year 1999 appropriations, DPRW
    accomplished a tremendous amount towards the advancement of the
    project. The coordination and education of the public, Environmental
    analysis and pre-construction engineering are progressing very well.
    The state has also recognized the need for this system and have passed
    through committee an $82,000 Renewable Resource grant and a $100,000
    appropriation through the Joint Committee on Resources. These funds
    will be for fiscal year 1999 and 2000.
        With the funds from this request and the state and local funds, we
    hope to able to complete the environmental assessment and final
    engineering work. In the event the project is authorized this year, we
    will be ready to begin design level investigations.
        With the help from the previously allocated funds, DPRW has been
    able to secure a strong public participation in this project. All or
    100 percent of the cities have passed resolutions to participate in the
    system. They have paid or budgeted $5 per water service. The rural
    drive is going equally as well. From the rural sector we ask a $100 fee
    to be included in the planning of the system. Over 50 percent have sent
    in their fee with about 20 per week coming in at this time. The rural
    membership drive was started in December of 1998.
        One of the benefits that has already been realized from this effort
    is the trust and friendship building between the on and off-Reservation
    people. The joint effort to solve this common problem has made us aware
    of the different problems each of us face on both sides of the
    reservation borders. The problems will be easier to solve together.
        The water quality problems in the DPRW service area are similar to
    the problems on the Fort Peck Reservation. DPRW has one city with a
    condemned water system with two more operating at the edge of
    compliance. The quality of the ground water we are presently using has
    deteriorated quickly in recent years. Several cities have recently
    built treatment facilities only to find that they do not adequately
    purify the water. The excessive amounts of iron, sodium, nitrates, and
    sulfates are very expensive and difficult to filter out.
        We strongly believe that the only permanent and most economically
    feasible solution to the water problems in North East Montana is a
    regional water system using Missouri River water. With out this type of
    system, we will be forever struggling to find ways to make useless
    water usable. The health and economical welfare of this area depends on
    the success of this project.
        The Montana delegation introduced S 841 and H 2306 to the 105th
    Congress. These bills have been reintroduced this year. With strong
    state and local involvement we hope to be more successful in our bid
    for authorization.
                                     ______

           Prepared Statement of the Fort Peck Assiniboine and Sioux
        The Fort Peck Assiniboine and Sioux Tribes respectfully request
    funds to continue planning of the Fort Peck Reservation RWS, Montana,
    in the amount of $447,000. The Tribes are joined in fiscal year 2000 by
    the Dry Prairie Water System, a part of the Fort Peck Assiniboine and
    Sioux Rural Water System, that is planning water service to all or
    parts of Roosevelt, Sheridan, Daniels and Valley counties outside the
    Fort Peck Indian Reservation. The request for funds is for continued
    pre-authorization work on the Fort Peck Indian Reservation ($254,000)
    and within Dry Prairie Water System ($193,000).
        The Tribes are highly appreciative of the work by this Subcommittee
    on the project previously. In fiscal year 1993 and fiscal year 1994,
    $350,000 were appropriated, and in fiscal year 1997 through fiscal year
    1999, $810,000 were appropriated.
       accomplishments with prior appropriations and proposed activities
        The work products completed to date by the Bureau of Reclamation
    include a Needs Assessment and Feasibility Report within the boundaries
    of the Fort Peck Indian Reservation. The Fort Peck Assiniboine and
    Sioux Tribes have continued to work with the Bureau of Reclamation and
    the Tribes' engineer to improve upon and update the cost estimates for
    a regional project. The Final Engineering Report is in progress and
    will be completed in fiscal year 1999, incorporating the cost of
    expanding facilities on the Fort Peck Indian Reservation to serve the
    Dry Prairie Water System outside the Fort Peck Indian Reservation. The
    State of Montana, by action of its legislature, appropriated $62,000 in
    fiscal year 1997 to provide for a Needs Assessment and cost estimate of
    facilities outside the Reservation. The 1999 Montana Legislature is
    currently considering $182,000 in planning funds. The needs and
    facility costs determined for the Dry Prairie Water System are being
    incorporated into the Final Engineering Report.
        Based on the considerable pre-authorization work that has been
    completed fiscal year 2000 funding will provide for conclusion of the
    environmental assessment and value engineering concepts in the Final
    Engineering Report. In the event the project is authorized in fiscal
    year 1999, the fiscal year 2000 appropriations will be used to complete
    NEPA compliance requirements and to begin design level investigations.
             progress of the fort peck assiniboine and sioux tribes
        Through the efforts of this Subcommittee, planning for the project
    has been adequately advanced and we are hopeful that the project will
    be authorized this year. Specific technical objectives with the fiscal
    year 2000 funds include continued public involvement and coordination
    with off-Reservation interests in the Dry Prairie Water System by the
    Fort Peck Assiniboine and Sioux Tribes, continued work with the Bureau
    of Reclamation on NEPA and ways of reducing project costs while
    delivering necessary water requirements.
        The Tribes are extremely pleased with progress on the project to
    date. fiscal year 1997 through fiscal year 1999 focused on public
    involvement within the Fort Peck Indian Reservation and outside it. The
    Tribes held numerous public meetings to acquaint residents within the
    boundaries of this regional project with capital costs, operation and
    maintenance costs, planning for the establishment of an operation and
    maintenance entity and the potential impact on environmental resources.
    The Tribes have planned the use of water from the Missouri River on the
    basis of their Compact with the State of Montana which assures a
    dependable supply of project water without shortage. The efforts of the
    Tribes have involved members of the Tribal Council, Water Resources
    staff, the Tribes' Water Commission, members of the Fort Peck
    Assiniboine and Sioux Tribes and other residents of the Fort Peck
    Indian Reservation.
        Detailed cost estimates have been refined and expanded off the
    Reservation by the Fort Peck Assiniboine and Sioux Tribes and Counties
    Water System to assist water users and communities in an evaluation of
    the costs of participating in the project and improving drinking
    quality.
        The total project cost within the Reservation, sized to carry off-
    Reservation water demands, is $103 million. The cost of enlarging the
    facilities to carry water to meet off-Reservation municipal, rural and
    industrial demands is $26 million (included in the $103 million). The
    cost of facilities outside the reservation is $76 million. Therefore,
    total project costs are $179 million. Assuming a cost share of 76
    percent federal and 24 percent local, consistent with the Safe Drinking
    Water Act, as amended, and comparable projects funded by the
    Subcommittee, the non-federal cost share would be $16.0 million. The
    Tribes recognize that the cost share details necessarily require
    Congressional concurrence and authorization.
        The cost of annual operation and maintenance of Fort Peck and Dry
    Prairie facilities is estimated at $2.57 per thousand gallons. Off-
    Reservation users will have additional costs to operate and maintain
    off-Reservation transmission and distribution facilities and to retire
    debt. The Dry Prairie monthly cost of water at $40.00 is near the edge
    of the ability to pay.
                      dry prairie water system activities
        Part of the effort of the Fort Peck Assiniboine and Sioux Tribes
    during fiscal year 1997 and 1998 was to work with the off-Reservation,
    Dry Prairie, interests in the project to assist them with organization
    and an improved understanding of the project. This resulted in the
    formation of a Steering Committee for the Dry Prairie System, which
    then evolved to the formation of a conservation district under Montana
    law or a non-federal entity with a board of directors to plan and
    design the Dry Prairie system.
        The board has undertaken a fund drive for both communities and
    rural residences. One hundred percent (100 percent) of the communities
    have indicated their support of the project by contributing $5.00 per
    service connection, and as much as 75 percent participation from rural
    farmers and ranchers is expected with a $100.00 sign up requirement to
    evidence the support of the individual to the project. The degree of
    support for the project exceeds most other rural water projects in the
    northern great plains and indicates the severity of the water problem
    in the region. Improvement in the source and quality of water are
    considered essential to stabilizing the population of the area and
    attracting new industry.
          water quality of existing drinking water supplies and needs
        The geologic setting of the Fort Peck Indian Reservation and the
    counties outside the Reservation is comparable to the rest of eastern
    Montana, North Dakota and South Dakota. With the exception of the
    Missouri River, which is a high quality water source, the groundwater
    supplies of the region are of poor quality, derived from shales
    deposited in ancient seas. Some of the worst water on the North
    American Continent lies below the Fort Peck Indian Reservation in the
    Madison Formation. This water is not used for human or livestock
    consumption. It is a brine several times more concentrated than sea
    water. Above this unsuitable aquifer are lesser aquifers that have been
    subjected to oil and gas development and have been contaminated, in
    part, by those activities. Other near-surface aquifers are subject to
    growing nitrogen contamination from agricultural activities within the
    area.
        The Poplar River, which flows through the central portions of the
    Fort Peck Indian Reservation and the region is the subject of an
    Apportionment Agreement between Canada and the United States. Half of
    the water supply is available for Canada as measured at the
    International Boundary, and the balance is available for use in the
    United States. Depletion of this resource by agricultural and coal-
    fired power generation on the Canadian side increases the
    concentrations of chemicals and contaminants in the supply for the
    United States. The Poplar River and its principle tributaries are
    neither dependable supplies of water nor are they of suitable quality
    for this project. Thus, the Fort Peck Tribes and the Counties Water
    System are seeking a regional water project, comparable to Garrison,
    WEB, Mni Wiconi and Mid-Dakota that rely on the high quality waters of
    the Mainstem Missouri River.
        The feature of this project that makes it more cost effective than
    similar projects is its proximity to the Missouri River. The southern
    boundary of the Fort Peck Indian Reservation is formed by the Missouri
    River for a distance of more than 60 miles. Many of the towns in this
    regional project are located two to three miles from the river,
    including Nashua, Frazer, Oswego, Wolf Point, Poplar, Brockton,
    Culbertson, and Bainville. As shown on the enclosed project map, a
    looping transmission system outside the Fort Peck Indian Reservation
    will deliver water 30 to 40 miles north of the Missouri River.
    Therefore, the distances from the Missouri River to all points in the
    main transmission system are shorter than in other projects of this
    nature in the Northern Great Plains.
        For comparison of water quality of this project with other regional
    projects, please refer to Tables 1 and 2.
                project authorization sought in fiscal year 1999
        In the first session of the 105th Congress, the Montana delegation
    introduced S. 841 and H.R. 2306, comparable bills in both houses of
    Congress for authorization of the Fort Peck Assiniboine and Sioux Rural
    Water Project. A hearing was held on the proposed legislation by the
    Senate Water and Power Subcommittee in fall 1997. A hearing before the
    House Water and Power Subcommittee was held in summer 1998. Means of
    financing the project within the Reclamation budget were discussed in
    the context of the GAO Report on this project and Lewis and Clark.
        The Montana delegation is working with the Tribes and the Dry
    Prairie Rural Water to re-introduce authorizing bills early in this
    session. The project is building good relationships throughout the
    region as we determine the interests of those outside the Reservation
    in participating in this most important project. The community-building
    aspects of the project have been considerable over a short period of
    time.
        We have worked with the Bureau of Reclamation to address its
    concerns related to federal and non-federal cost share, among other
    matters. Many of the initial issues have been clarified to the mutual
    satisfaction of the sponsors and Reclamation. There has also been good
    coordination with the Western Area Power Administration on the power
    provisions of the bills.@

    Table 1.--Comparison of Fort Peck Total Dissolved Solid Levels With
    Comparable Projects

                                                      Total dissolved solids
                                                           project community
            Project/community                                          (mgl)

    Fort Peck--Fort Kipp.............................................. 2,730
    Lewis and Clark--Upper Limit...................................... 2,600
    Mni Wiconi--Red Shirt............................................. 2,332
    Mni Wiconi--Reliance.............................................. 2,056
    Mni Wiconi--Murdo................................................. 1,761
    Mni Wiconi--Kennebec.............................................. 1,740
    Mni Wiconi--Presho................................................ 1,398
    Fort Peck--Poplar................................................. 1,380
    Fort Peck--Frazer................................................. 1,180
    Lewis and Clark--Lower Limit...................................... 1,179
    Mni Wiconi--Wakpamni Lake......................................... 1,125
    Mni Wiconi--Horse Creek...........................................   869
    Fort Peck--Brockton...............................................   748
    Mni Wiconi--Pine Ridge Village....................................   416

    Table 2.--Comparison of Fort Peck Sulfate Levels With Comparable
    Projects

            Project/Community                                  Sulfate (mgl)

    Lewis and Clark--Upper Limit...................................... 1,500
    Mni Wiconi--Reliance.............................................. 1,139
    Fort Peck--Fort Kipp.............................................. 1,120
    Mni Wiconi--Red Shirt............................................. 1,080
    Mni Wiconi--Murdo................................................. 1,042
    Mni Wiconi--Kennebec..............................................   984
    Mni Wiconi--Presho................................................   644
    Lewis and Clark--Lower Limit......................................   538
    Fort Peck--Frazer.................................................   498
    Mni Wiconi--Horse Creek...........................................   410
    Mni Wiconi--Wakpamni Lake.........................................   398
    Fort Peck--Brockton...............................................   212
    Fort Peck--Poplar.................................................   103
    Mni Wiconi--Pine Ridge Village....................................    70

      Prepared Statement of Hon. Jim Geringer, Governor, State of Wyoming
        This testimony supports the appropriation in fiscal year 2000 of
    $17,500,000 for the Bureau of Reclamation's basin-wide Colorado River
    Basin Salinity Control Program. This testimony is submitted in support
    of a fiscal year 2000 appropriation of $17,500,000 for the Bureau of
    Reclamation's Colorado River Salinity Control Program. Testimony was
    recently submitted to this Subcommittee by the Colorado River Basin
    Salinity Control Forum (Forum), a seven-state organization created by
    the Governors of the Colorado River Basin States, by the Forum's
    Executive Director, Jack Barnett. The State of Wyoming, a member state
    of the Forum, concurs in the Forum's testimony. While the President's
    recommended budget line-item for the basin-wide Colorado River Basin
    Salinity Control Program is $12,300,000, the State of Wyoming and the
    Forum urge the Congress to increase the appropriation for this Program
    by $5,200,000. The implementation of the Program has fallen behind the
    needed pace to prevent salinity concentration levels from exceeding
    specified numeric criteria in the water quality standards for the
    Colorado River. In addition to considerations of complying with this
    basin-wide water quality standard, the United States has committed to
    the Republic of Mexico, pursuant to Minute 242 of the 1944 ``Treaty
    Between the United States and Mexico, Relating to Waters of the
    Colorado and Tijuana River and of the Rio Grande,'' to managing the
    salinity concentrations of water deliveries to Mexico.
        The State of Wyoming is one of the seven member states represented
    on the Forum and the Colorado River Basin Salinity Control Advisory
    Council (Council). The Council was created by Section 204 of the 1974
    Colorado River Basin Salinity Control Act (Public Law 93-320). Like the
    Forum, the Council is composed of gubernatorial representatives of the
    seven Colorado River Basin states. Both the Council and Forum serve
    important liaison roles among the seven states, the Secretaries of the
    Interior and Agriculture and the Administrator of the Environmental
    Protection Agency (EPA). The Council is directed by statute to advise
    these federal officials on the progress of the federal/state cost-
    shared, basin-wide salinity control programs, and annually recommends
    to the Federal agencies what level of funding it believes is required
    to meet the objective of assuring continuing compliance with the basin-
    wide water quality standards.
        The Council last met in October 1998 and developed funding
    recommendations for fiscal years 2000 and 2001 based on the progress
    the Bureau of Reclamation, the U.S. Department of Agriculture, the
    Bureau of Land Management and the seven states are making in
    implementing their programs for managing and reducing the salt loading
    into the Colorado River System. The Council's funding recommendations
    further heeded analyzes made by the Bureau of Reclamation and the
    Forum. Every three years the Forum updates the plan of implementation
    for maintaining the Colorado River water quality standards for salinity
    in accordance with Section 303 of the Clean Water Act. The 1996
    triennial review of the standards identified the need for the Bureau of
    Reclamation to expend $17,500,000 per year in order to carry out its
    portion of the plan of implementation. The plan is devised to assure
    that the salinity concentrations of Colorado River water do not exceed
    the numeric criteria set forth in the standards. Based on its own
    review of the facts, the Council recommended that a minimum of
    $17,500,000 needs to be expended by the Bureau of Reclamation during
    fiscal year 2000 to accomplish needed salinity control activities.
        This funding level is appropriate if the salinity of Colorado River
    waters is to be controlled so as not to exceed the numeric salinity
    concentration criteria contained within the water quality standards for
    the Colorado River. Without the necessary levels of funding, there is
    an increased probability that the numeric criteria will be exceeded
    resulting in violations of the basin-wide water quality standards.
    Without the necessary levels of funding, there is an increased
    probability that the numeric criteria will be exceeded resulting in
    violations of the basin-wide water quality standards. Failure to
    maintain the standards' numeric criteria could result in the imposition
    of state-line water quality standards (as opposed to the successful
    basin-wide approach that has been in place since 1975) and impair
    Wyoming's ability to develop our Compact-apportioned water supplies.
    The present basin-wide salinity control program and its funding
    arrangements appropriately reflects that the primary beneficiaries of
    the basin-wide salinity control program are in the Lower Basin while
    the most cost-effective opportunities to reduce salt loading are
    upstream in the Upper Basin. Failure to maintain the standards' numeric
    criteria could result in the imposition of state-line water quality
    standards (as opposed to the successful basin-wide approach that has
    been in place since 1975) and impair the states' ability to develop its
    Compact-apportioned water supplies. Delaying or deferring adequate
    funding will create the need for a much more expensive salinity control
    effort in the future to assure that the Colorado River Basin states are
    able to comply with the water quality standards. ``Catch-up'' funding
    in the future will require the expenditure of greater sums of money,
    increase the likelihood that the numeric criteria for Colorado River
    water quality are exceeded, and create undue burdens and difficulties
    for one of the most successful Federal/State cooperative non-point
    source pollution control programs in the United States.
        In July, 1995, Congress amended the Colorado River Basin Salinity
    Control Act. The amended Act provided Reclamation with additional
    authorities that have improved upon the cost-effectiveness of
    Reclamation's salinity control program, in large part because it
    provided for proposals and greater involvement from the private sector.
    Submitted proposals have far exceeded the available funding, while at
    the same time overall progress in accomplishing the rate of salinity
    control determined to be needed and as set forth in the Plan of
    Implementation continues to fall behind the scheduled rate.
        We urge this Subcommittee to fund the level for the Colorado River
    Basin Salinity Control Program line-item in Reclamation's budget at
    $17,500,000. In addition to the funding needs identified for the basin-
    wide Colorado River Basin Salinity Control Program, the State of
    Wyoming supports the appropriation of Operation and Maintenance funds
    for completed Reclamation salinity control projects, including the
    Paradox Valley Unit. The State of Wyoming understands that a portion of
    the General Investigation Funds included in the President's budget are
    intended for salinity control activities. Wyoming supports the
    appropriation of funds to accomplish these necessary planning and
    investigation activities.
        Thank you for the opportunity to submit this testimony. I request,
    in addition to your consideration of its contents, that you make it a
    part of the formal hearing record concerning fiscal year 2000
    appropriations for the Bureau of Reclamation.
                                     ______

                  DEPARTMENT OF ENERGY PROGRAMS AND ACTIVITIES
          Prepared Statement of the American Society for Microbiology
        The American Society for Microbiology (ASM), the largest single
    life science organization in the world, comprised of more than 43,000
    members, appreciates the opportunity to provide written testimony on
    the fiscal year 2000 budget for the Department of Energy's (DOE)
    research programs.
        The ASM represents scientists who work throughout academic,
    governmental and industrial institutions worldwide. Microbiologists are
    involved in research to improve human health and the environment. The
    ASM's mission is to enhance the science of microbiology, to gain a
    better understanding of basic life processes, and to promote the
    application of this knowledge for improved health, and for economic and
    environmental well being.
        The ASM strongly supports the inclusion of basic science programs
    within the DOE. While relatively small in terms of the overall DOE
    appropriation, these programs provide important fundamental discoveries
    that establish the foundation for subsequent developments in
    biotechnology related to energy and the environment. It is imperative
    for the United States to maintain a strong science budget that supports
    basic research.
        Along with enhanced appropriations to fund specific program areas,
    it is important that the DOE receive increases in administrative
    budgets to properly staff and manage fundamental science programs.
    Investments in well-managed basic and applied science programs can
    produce long term benefits. Over the past decade, scientific research
    has become more interdisciplinary. It is essential that DOE have the
    resources necessary to adapt to these changes in science and to hire
    the necessary experts to manage programs effectively. This will allow
    the Agency to make educated program and funding decisions based on
    cross-disciplinary scientific expertise.
        Many DOE scientific research programs share the common goal of
    producing and conserving energy in environmentally responsible ways.
    Areas of research include basic research projects in microbiology, as
    well as, extensive development of biotechnological systems to produce
    alternative fuels and chemicals, to recover fossil fuels, to improve
    the refinement process of fossil fuels, to remediate environmental
    problems, and to reduce wastes and pollution.
        In 1997, the United States signed the Kyoto Protocol and committed
    to reduce the nation's carbon dioxide emissions to eight percent below
    1990 levels. The Administration proposed a government-wide Climate
    Change Technology Initiative (CCTI) to implement this commitment and to
    find solutions to problems associated with greenhouse gasses. The
    President's budget for DOE proposes $437 million for this initiative.
    These funds will be allocated throughout the Agency's programs
    including the Office of Science (SC). Biological research is slated to
    receive a significant boost from this initiative. As part of the CCTI,
    DOE will support microbiological research on carbon management science
    including basic studies on microorganisms that consume carbon, and on
    other microbes that assist in the development of carbon free energy
    sources. Combating global warming is critical and these programs will
    make significant contributions to the long-term battle to maintain the
    quality of our atmosphere.
        The ASM is encouraged by the President's budget request for DOE's
    science programs. The Administration's proposed budget for fiscal year
    2000 requests $17.8 billion for the DOE overall. Included in that
    request is $2.8 billion for programs supported by the Office of
    Science. The following comments focus on research supported by the
    Biological and Environmental Research (BER) and Basic Energy Sciences
    (BES) programs and make recommendations related to carbon management,
    genomics, bioremediation, ocean science, and basic energy science.
    Federal investment in these programs today will help to ensure
    fundamental research to find solutions to future environmental and
    energy problems while maintaining U.S. scientific leadership worldwide.
                           carbon management science
        An important component of the CCTI program in BER addresses the
    basic phenomena and strategies for managing the carbon budget of our
    terrestrial and ocean systems. Biological sequestration of carbon, both
    its capture and stability of the biologically produced carbon forms,
    has major effects on the global CO2 and methane
    concentrations. Furthermore, stored carbon such as soil carbon, has
    beneficial effects on plant growth, water retention in soil, and soil
    structure.
        The President's budget proposes an increase from $5.5 million in
    fiscal year 1999 to $13.0 million in fiscal year 2000 for the carbon
    management research program. Approximately $5.8 million of this budget
    would be devoted to genome sequencing of microorganisms important to
    carbon sequestion and hydrogen production. ASM strongly supports this
    enhanced effort and believes that new understanding will be derived
    that will aid decisions about management of the global carbon cycle,
    and new biotechnologies discovered that can reduce CO2,
    convert carbon to useful products and stabilize fixed carbon.
                                    genomics
        DOE supports the Microbial Genome Program (MGP) within the Office
    of Biological and Environmental Research . The program, developed in
    1994 as a compliment to the Human Genome Program, already provides
    complete genome sequence information on important microorganisms. The
    Administration has proposed $10 million for fiscal year 2000, about $1
    million more than last year.
        Genome sequencing has revolutionized the scientific approach to
    understanding biology and is providing a depth of insight not
    previously possible. DOE's MGP has led the way in this new biological
    era, completing full genome sequences of several microorganisms
    important in energy and environmental processes. Now, however, other
    nations have seen the promise of this field of research and have
    mounted significant programs. Continued growth in the DOE MGP is
    critical to maintaining U.S. leadership in this important field. This
    research should include not only the genome sequencing but the
    functional analysis of those genomes, the associated software and
    databases to fully and efficiently analyze the information, and
    development of new technologies to help characterize the genes of
    unculturable microbes in nature.
        In view of the tremendous potential to be derived form microbial
    genome sequencing, ASM recommends that Congress provide $15 million for
    the MGP. A base funding level of $10 million to sequence critical
    organisms within the scope of DOE's mission should be provided to the
    MGP. Funding from the CCTI should serve as an add-on to the program for
    specialized sequences of organisms related to the mission of the CCTI.
        Researchers supported by the MGP have already sequenced several
    complete microbial genomes, including ones from methanogens living in
    deep-sea thermal vent regions, and a bacterium that is extremely
    resistant to radiation, Deinococcus radiodurans. This sequence
    information provides clues into how we can design biotechnological
    processes that will function in extreme conditions, including ones that
    will generate fuels and help clean up the environment. With each new
    genome that is sequenced we gain a greater understanding of microbial
    evolution and diversity. Also, each sequenced genome has revealed how
    much more science needs to learn. Thirty percent of each genome has no
    known function. This presents a great challenge for scientists to
    unravel the genomes' significance for understanding microbial evolution
    and the potential for biotechnological developments.
        The DOE has established the necessary peer review and advisory
    program to the MGP to ensure that the microorganisms selected for
    sequencing will yield the greatest scientific informational benefits
    and that the research is of the highest quality. Important new
    knowledge has been gained from each and every genome sequenced. The ASM
    believes that even greater benefits would be achieved if the program
    were funded at the level of $15 million and strongly urges this
    Subcommittee to consider adding these funds to the Microbial Genome
    Program for support of competitive research.
        The DOE has expanded its research into microbial diversity, and has
    begun sequencing the genomes of bioremediative microorganisms. Due to a
    scientific approach called sequence leveraging, a practice of using
    previously sequenced microbes to build the sequences of similar non-
    sequenced microbes in a more cost-effective manner. The results of
    these initiatives will be readily available to other scientists,
    through the use of on-line databases. All genome sequences supported by
    the MGP are available to the public and as such contribute to further
    scientific exploration. The public disclosure of genomic data will aid
    scientists in their research into new biotechnologies such as
    bioremediation, a technology that is proving to be a practical and a
    cost-effective way of eliminating pollutants.
                                 bioremediation
        The MGP's research into bioremediative microorganisms compliments
    the research supported by the DOE's Natural and Accelerated
    Bioremediation Program (NABIR) and other DOE bioremediation research
    initiatives. The NABIR program is level funded from fiscal year 1998
    with a request for fiscal year 2000 of $19.1 million. The ASM supports
    the Administration's request for bioremediation research. However, the
    ASM believes that greater benefits will be achieved if the NABIR
    program is increased to $30 million, which is more consistent with the
    original $40 million plan for the program.
        Bioremediation scientists are searching for cost-effective
    technologies to improve current remediation methods to clean up DOE's
    contaminated sites. This research will lead to new discoveries into
    reliable methods of bioremediation of metals and radionuclides as well
    as organic pollutants in soils and groundwater. The NABIR program
    supports the basic research that is needed to understand this
    technology to more reliably develop the practical applications for
    cost-effective cleanup of pollutants at DOE sites. The ASM strongly
    recommends that additional funding be allocated to balance the program
    elements and pollutants studied as originally envisioned when the NABIR
    Program was designed.
                                 ocean science
        Other exciting new microbiological research supported by BER is in
    the Ocean Sciences Program. The Administration's budget request
    includes $6.9 million for this program in fiscal year 2000.
    Microbiological research supported by the Ocean Sciences Program
    investigates the effects global change has on marine microbes. The
    findings from this program will be crucial to understanding the
    responses of marine biological systems to changes in their
    environments. The ASM fully supports the Administration's request for
    this program.
                             basic energy sciences
        The Administration's requested funding level for the Office of
    Basic Energy Sciences is $888.1 million for fiscal year 2000. This
    funding level is an $88.6 million increase over last year. BES funds
    important microbiological basic research programs through the Energy
    Biosciences Division. In fact, about one fifth of all BES funds go
    directly to support research at academic institutions across the
    nation.
        This program focuses on research in both microbiological and plant
    sciences that will lead to new discoveries in producing energy without
    risk to the environment and finding effective methods of cleaning up
    existing contamination. The CCTI effort of BES is proposed to increase
    from $8.0 million to $20.0 million in fiscal year 2000. Research on the
    microbial role in the carbon cycle is an important part of this
    program.
        Other microbiological research supported by this program includes
    biotechnology related to energy, biofuel production, and technologies
    to aid in the restoration of contaminated environmental sites. More
    basic research on hydrogen, methane, and ethanol production is needed
    if we are to meet future energy needs and to have fuels that will
    minimize environmental pollution. The ASM supports the proposed funding
    level for this program and urges Congress to allocate these funds for
    the Energy Biosciences.
                                   conclusion
        DOE's research programs help to keep the United States at the
    forefront of scientific discovery and competitive in the world
    marketplace. The ASM encourages Congress to maintain its commitment to
    the Department of Energy research programs to maintain the United
    States' leadership in these vital industries and continue our
    commitment to a strong basic science program.
        The debate over the effect of greenhouse gasses on the environment
    is complex. While some may disagree about the severity of the
    greenhouse problem, most will agree that the reduction of industrial
    gasses emitted into the atmosphere will provide more long term
    environmental benefits than continuing to increase the rate these
    gasses enter our atmosphere. In Kyoto, the United States committed to
    significantly reduce carbon dioxide emissions into the atmosphere.
    DOE's basic research programs support research that investigates
    solutions to existing and future environmental and energy problems.
    Through the leadership of DOE's basic research science in clean fuels,
    and environmental processes, new technologies will be developed to
    enable the U.S. to be better prepared to meet environmental problems
    and the economic challenges associated with them.
        In summary, the ASM makes the following recommendations:
      --The ASM believes that it is imperative for the United States to
            maintain a strong science budget that supports basic research.
      --It is essential that the DOE receive sufficient increases in
            administrative budgets to properly staff and manage biological
            science programs.
      --The ASM recommends that Congress provide $15 million, $6 million
            more than fiscal year 1999 funding, for the Microbial Genome
            Program. The MGP should have a base funding level of $10
            million to sequence critical organisms within the scope of
            DOE's mission. Funding from the Climate Change Technology
            Initiative should serve as an add-on to the program for
            specialized sequences of organisms related to the mission of
            the CCTI.
      --The ASM recommends that the CCTI programs in BER and BES receive
            the $33.0 million proposed for fiscal year 2000, and that $5.8
            million of this be devoted to genome sequencing of
            microorganisms important to global carbon management.
      --The ASM recommends $30 million be appropriated for the NABIR
            program to provide the funds necessary to sustain a balanced
            program of bioremediation research on chemicals important to
            DOE site cleanup.
      --The ASM fully supports the Administration's request for $6.9
            million for the Ocean Sciences Program.
        Thank you for the opportunity to provide testimony in support of
    the DOE basic life sciences programs. The ASM hopes that its
    recommendations will be useful to the Subcommittee. We would be pleased
    to respond to any questions.
                                     ______

     Prepared Statement of Dr. Ellen Futter, President, American Museum of
                                Natural History
        Founded in 1869, the American Museum of Natural History is one of
    the nation's pre-eminent scientific and educational institutions. For
    over 129 years, the Museum has pursued a mission of examining critical
    scientific issues and increasing public knowledge about them.
    Throughout the Museum's history, its explorers and scientists have
    pioneered discoveries that have offered us new ways of looking at
    nature and human civilization. The Museum has sponsored thousands of
    expeditions, sending scientists and explorers to every continent. This
    rich scientific legacy includes an irreplaceable record of life on
    earth in collections of some 32 million natural specimens and cultural
    artifacts that are an extraordinary research tool and represent the
    focus of science at the Museum. The Museum's power to interpret wide-
    ranging scientific discoveries and convey them imaginatively has
    inspired generations of visitors to its grand exhibition halls and
    educated millions about the marvels of the natural world and the
    vitality of human culture. With four million visitors annually (of whom
    half are schoolchildren), the largest unified natural history library
    in the Western Hemisphere, a staff of dedicated educators who seek to
    inspire curiosity and a desire to learn in both children and adults,
    the Museum is known as one of the nation's preeminent scientific and
    educational institutions.
        More than 200 active research scientists with internationally
    recognized expertise conduct more than 150 field projects each year.
    Museum scientists in the ten scientific departments are retracing the
    evolutionary tree, documenting changes in the environment, and
    describing the achievements of human culture affecting the public's
    understanding of where we come from and where we may be headed.
        The Museum's ongoing research provides the foundation for its
    educational mission. The goals of its educational programs include
    increasing scientific literacy among both adults and children
    nationwide addressing issues that affect our daily lives and the future
    of the planet and its inhabitants, and providing a forum for exploring
    world cultures. The recent Museum's launching of the National Center
    for Science Literacy, Education, and Technology in partnership with
    NASA helps to further these goals. In creating the National Center,
    AMNH and NASA recognized an opportunity to combine and leverage their
    incomparable resources. The National Center creates materials and
    programs that reach beyond our institutional walls into homes, schools,
    museums, and community organizations around the nation.
        The Museum actively continues a tradition of creating some of the
    greatest scientific exhibitions in the world. Early in the year 2000,
    the Museum will open the new Rose Center for Earth and Space, in one of
    the most exciting chapters in the Museum's long and distinguished
    history of science and education. The Rose Center includes a newly
    rebuilt and updated Hayden Planetarium and will allow visitors to
    journey among the stars and planets in our own galaxy as well as those
    of other galaxies; the Lewis B. and Dorothy Cullman Hall of the
    Universe, where interactive technology and participatory displays will
    elucidate important principles of astronomy and astrophysics; and the
    adjoining Gottesman Hall of Planet Earth (opening in 1999). The new
    Hall of Planet Earth will explore key questions such as: how has the
    Earth changed though time; why do ocean basins continents and mountains
    exist; what causes climate change; and why is the Earth habitable. As
    part of the exhibition the question of natural resources will be
    explored: what are they; what resources are necessary to generate
    energy (oil, coal, goethermal); where are they located; and how are
    they formed. The Rose Center for Earth and Space will enable the Museum
    to join science and education to provide a seamless educational journey
    taking visitors from the beginnings of the universe, to the formation
    and processes of Earth to the extraordinary and irreplaceable diversity
    of life and cultures on our planet.
        One of the strategic goals of the Department of Energy is to
    utilize its assets to advance the nation's science literacy. In
    addition to our mutual commitment to science literacy, the American
    Museum and DOE share several other joint goals, including: making
    science/scientific enterprise more accessible to a large and diverse
    audience; harnessing the power of technology to support science,
    exhibition, and education; and enhancing the diversity of the science
    workforce working with schools, parents, and the community. The DOE has
    enormous resources that can support the activities of the American
    Museum's science, exhibition, and education programs. In partnership
    with DOE, the Museum would significantly advance the public's access to
    the expertise, data and technology that has been developed by DOE.
        The Department of Energy has traditionally been one of the major
    sources of support for research and laboratory instrumentation
    equipment. The types of laboratories and instrumentation that the
    American Museum seeks are indeed consistent with the DOE's mission. The
    Molecular Systematics Lab is a critical tool to basic energy research,
    the human genome project, and the Department's biological and
    environmental research function (the BER account).
        Technology is rapidly changing the way we perceive nature. With the
    advent of DNA sequencing, museum collections have become critical
    baseline resources for the assessment of the genetic diversity of
    natural populations. Genomes, especially those of the simplest
    organisms, provide a window onto the fundamental mechanics of life. One
    of the goals of the DOE sponsored Human Genome Program is to learn
    about the DNA of nonhuman organisms. This, the sponsors of the research
    say, can lead to an understanding of their natural capabilities that
    can be applied toward solving challenges in health care, energy
    sources, and environmental cleanup. We believe that the Museum's
    accomplishments in this area support and complement the Department of
    Energy's goals in this area.
        The American Museum has a history of being at the forefront of
    conservation activities. In addition, the molecular systematics
    programs at the Museum are on the cutting edge in the use of DNA
    sequences in conservation and evolutionary research. The Museum houses
    two molecular laboratories that are directed by four curators from the
    Museum and one from The New York Botanical Garden. Current studies
    focus on a variety of endangered species representing diverse
    geographic and taxonomic scope, including: tiger beetles and moths of
    the Atlantic coast of North America, sturgeon of the Caspian Sea,
    muntjacs (small deer) recently discovered in Southeast Asia, lemurs and
    whales of Madagascar, spotted owls of the Pacific Northwest, tiger
    populations throughout Asia, and right whales around the world. Ancient
    DNA, essential for historical study of changes in genetic markers in
    endangered species, has been recovered from museum specimens of rare or
    extinct animals, as well as 25-million-year-old termites fossilized in
    amber.
        As more species become threatened and extinct, it is more critical
    than ever to catalogue and store the variety of life's natural genetic
    diversity so that it will be available far into the future. For these
    reasons, the Museum has launched a new effort to create a super-cold
    storage facility. Located in a new, state-of-the-art collections and
    laboratory building, this new storage facility will enable Museum
    scientists and researchers from around the world to perform unique and
    vital DNA research. This new storage facility will multiply the
    possibilities for DNA research exponentially.
        Molecular techniques have revolutionized the study of biology,
    including conservation, evolution, and medicine. As part of our ongoing
    mission in collections-based research we propose expanding activities
    in the preservation of biological tissues and molecular libraries in
    super-cold storage for current and future genetic research. This
    collection is unique and valuable for research in several fields,
    including:
      --Conservation genetics.--The practice of systematics and the
            management of endangered species rely on collections to provide
            data on the natural distribution of populations on the planet
            over time. Accurately identified specimens accompanied by data
            such as date and locality of their collection are essential for
            the design of field projects. With the advent of DNA
            sequencing, museum collections have become valuable resources
            for recognizing species and assessing changes in the genetic
            diversity of natural populations throughout periods of
            ecological change.
      --Systematics.--Natural history collections are critical resources
            for the creation of phylogenetic trees (branching diagrams
            representing evolutionary relationships), as many species that
            are pivotal to the reconstruction of a full evolutionary
            history of a group are known only from museum material. The
            American Museum frozen-tissue program provides a means to
            appropriately store rare organisms for molecular work. This
            collection serves as a permanent library of the molecular
            structure of organisms and is an important source of loans to
            investigators from around the world.
      --Medicine.--Better understanding of the natural arrangements of
            genomes and interactions among genes is driving, and will
            continue to drive, the development of novel therapies for
            disease. It is also clear that many genes of significant
            scientific and medical importance are found only in a few
            organisms. Such natural products are useful in ways we are only
            beginning to understand. Tissue collections such as the one we
            propose expanding at the Museum will preserve genetic material
            and gene products from rare and endangered organisms that may
            go extinct before science fully exploits their potential.
        The super-cold natural history collection is a permanent world wide
    resource for storage, conservation of genetic resources, and loans to
    the scientific community. Most biological material in natural history
    collections is dried or formalin fixed. While these methods preserve
    anatomy, they do not preserve nucleic acids and proteins in workable
    quantities. A super-cold natural history collection of vast biological
    diversity is underway at the Museum.
        Now in operation for eight years, the Musuem's molecular
    laboratories have accrued tens of thousands of specimens. We will
    create a database not only for record keeping, but also to make this
    collection easily searched via the Internet and accessible for loans by
    scientists outside the Museum. We foresee increased loan activity as
    the fields of molecular systematics and comparative genomics continue
    to grow. Because tissues could be easily depleted by several requests,
    molecular libraries (DNA in fragments multiplied and stored in easily
    workable vectors) are or will be constructed for many of these
    specimens. Many of the tissues and molecular libraries in the Museum=s
    frozen collection come from long-term field projects with extensively
    detailed data.
        We also suggest establishing a geographically based, publicly
    accessible Web site that enables users anywhere to access the available
    information. Projects of this type are critical to fostering a public
    understanding of human genomics and the fundamental building blocks of
    life, and are in keeping with the DOE's own stated goals.
        Molecular information is important for understanding the history of
    life. The phylogenetic trees constructed from DNA sequence data have
    changed how biologists think about ecology, evolution, conservation,
    development, and behavior. The phylogenetic approach relies heavily on
    primary DNA sequences. However, many lineages of organisms have only
    been sampled in a very cursory manner or not at all.
        In the past, the time and expense of DNA sequencing forced
    systematists to collect sequences from only one gene per species. A
    single set of character information is inadequate to represent the
    complexity of the organisms and their history. Fortunately, with
    support of the Department of Energy's Human Genome Program, DNA
    sequencing technology has improved rapidly in the past five years
    (bases sequenced per unit time has increased at least tenfold). This
    improvement has allowed the Museum's molecular labs to address gaps in
    knowledge of biodiversity by sequencing DNA from rare, endangered, and
    understudied organisms. Concomitantly, Museum scientists are working to
    improve the theory and implementation of phylogenetic analysis of vast
    data sets of DNA sequences and other forms of biological information
    such as the anatomy of extant and extinct organisms.
        Currently, the Museum has one old and one new sequencer, both of
    which are operated on a 24 hour/day, 7 day/week schedule. Museum
    researchers bring a great deal of knowledge of the natural world and a
    staggering diversity of organisms into the lab. Our students and
    scientists are not typically molecular biologists but rather
    zoologists, botanists, and resource managers who are trained at the
    Museum to collect raw sequence data from the organisms in which they
    specialize and analyze the data for evolutionary and conservation
    studies. Sequence data are shared worldwide on NIH's Genbank database
    and via original scientific research disseminated in theses and peer
    reviewed publications.
        Given that DNA sequencing technology has improved vastly in
    rapidity and cost effectiveness in the past five years, and given the
    Department of Energy's increased pace for the Human Genome Program, we
    seek in FY00 the addition of upgrade sequencing and computational
    equipment to the Museum's molecular laboratories. These upgrades will
    allow us to fully benefit from the intellectual resources represented
    by our students and scientists and the physical resources contained in
    our new super-cold storage facility. In addition, the Hall of Human
    Biology and Evolution at the Museum is a major resource for the public
    and especially students. The Human Genome Program of the DOE is an
    important endeavor. We propose to assist the DOE to translate its
    findings to the public through a AGenetics Bulletin, a set of
    continually updated interactive media kiosks that display research
    findings in the exhibition hall and can be made available
    internationally via public web sites.
        Despite empirical advances, no amount of sampling of DNA of extant
    animals will help researchers overcome the gaps in evolutionary history
    that are left by extinction events. As a result, analytical approaches
    that combine DNA sequence with other types of information such as the
    anatomy of living and fossil species are proving very informative.
    However, because of the mathematical difficulty inherent in calculating
    phylogenetic trees, our ability to understand data lags far behind our
    ability to produce raw data.
        A common theoretical problem in biology is the accommodation of
    diverse kinds of information and their ability to jointly support
    notions of evolutionary relationships. For example, several studies
    focus on the integration of data from adult anatomy with molecular
    information. How are such diverse kinds of information combined?
    Furthermore, how can the information presented by the fossil record
    help distinguish among hypotheses derived from molecular evidence? We
    have addressed these issues through new ways of describing characters
    (DNA or any feature of an organism) mathematically and linking them
    through novel means of phylogenetic-tree reconstruction. These methods
    are general and useful, but require immense computational attention,
    necessitating the development of new parallel algorithms in order to
    examine these procedures and questions.
        In addition to building biological expertise at the level of the
    molecule and organism, researchers at the Museum have been studying the
    mathematical and algorithmic complexities of phylogenetic analysis in
    great depth over the last 20 years. By expanding the parallel-
    processing cluster, we plan to develop and explore new approaches to
    making sense of the large and diverse datasets necessary to appreciate
    organismal diversity. The Museum has made software available to the
    research community free of charge and will continue to do so.
    Furthermore the Museum serves as a center for training and symposia on
    evolutionary theory.
        We are seeking, therefore, a fiscal year 2000 DOE investment of $2
    million to support genomic research and related facility and
    instrumentation needs including a super cold storage facility, DNA
    sequencing and computational equipment, and related educational
    materials.
                                     ______

    Prepared Statement of Joe L. Mauderly, Senior Scientist and Director of
         External Affairs, The Lovelace Respiratory Research Institute
        It is proposed that the Department of Energy negotiate with the
    Lovelace Respiratory Research Institute to establish a long-term
    agreement for operation of the privatized, government-owned Inhalation
    Toxicology Research Institute facility on Kirtland AFB in Albuquerque,
    NM.
                               executive summary
        Beginning in fiscal year 1997, the Lovelace Respiratory Research
    Institute joined DOE in a pioneering effort to privatize the operation
    of a small DOE research laboratory, the Inhalation Toxicology Research
    Institute in Albuquerque, NM. The facility was leased to Lovelace for a
    five-year period, allowing Lovelace to diversify and build federal and
    non-federal support for research in the facility, thereby preserving it
    as a national research resource, offsetting the economic impact of
    declining DOE funding and potential closure, and mitigating DOE's
    liability for decommissioning the facility. Lovelace continues DOE work
    under a cooperative agreement, and pays use fees for non-DOE work at
    the facility.
        Lovelace committed its resources to the success of the venture. It
    focused its corporate mission, out-placed peripheral activities,
    reorganized and consolidated its administrative and scientific
    activities, renovated portions of the facility at its own expense,
    developed an aggressive marketing program, diversified its customer
    base, and spearheaded a community technology incubator program which
    uses a portion of the facility.
        The privatization has been successful.--Research support for
    activities in the facility has increased. Research support has been
    diversified, and major new programs have been initiated for both
    federal and non-federal customers. To date, $359 thousand in use fees
    were collected. Many companies have been served by the incubator.
    Hundreds of direct jobs have been saved and many more indirect jobs are
    supported by the effort.
        The privatization is at a critical point, and the future
    disposition of the facility must be resolved quickly or the effort will
    fail.--Now, in the third year of the initial five-year agreement and
    with no resolution of longer-term use, Lovelace is prevented from
    establishing long-term research agreements for either federal or non-
    federal clients. DOE's Albuquerque Operations Office recently provided
    Lovelace with a draft agreement which would extend the lease for a
    total of up to 10 years. Lovelace urgently seeks an arrangement that
    provides a longer-term operating horizon and allows use fees to be used
    for facility maintenance.
                        background of the privatization
        The Lovelace Respiratory Research Institute (LRRI) is an
    independent, non-profit biomedical research organization located in
    Albuquerque, NM and dedicated to the prevention, treatment, and cure of
    respiratory disease. LRRI conducts basic and applied research for
    government, industry, health advocacy organizations, and the public.
    Beginning with a 1960 contract with the Atomic Energy Commission,
    Lovelace developed and managed the government-owned laboratory which
    became the DOE-owned Inhalation Toxicology Research Institute (ITRI), a
    one-of-a-kind international center of excellence for basic and applied
    research on respiratory disease, respiratory toxicology and
    environmental lung health risks. DOE work at ITRI was funded primarily
    by the Office of Energy Research (ER), with lesser levels of funding
    from the Offices of Defense Programs and Environment, Safety, and
    Health.
        During the late 1980s and early 1990s, the decline in DOE/ER
    priorities for research on health outcomes resulted in the closure of
    many of the Agency's laboratory-based biology programs, with the
    exception of those closely related to the human genome and nuclear
    medicine. Declining funding threatened the continued existence of the
    ITRI facility, and its operation as a special purpose DOE laboratory
    prevented Lovelace from replacing declining DOE funds by responding to
    other federal and non-federal research customers in a competitive
    manner. Recognizing the value of ITRI as a national research resource,
    Lovelace negotiated an agreement with DOE to privatize the facility on
    a five-year trial basis.
        LRRI leases the ITRI facility from the government through DOE as
    the landlord agency. The term of the present lease is five years, the
    first year being fiscal year 1997. The lease allows use and sublease of
    the facility for purposes generally consistent with past uses. Under
    the lease payment is made to the U.S. Treasury at the rate of 3.53
    percent of gross revenues from non-DOE sources, excluding support from
    LRRI's own endowment. Under the cooperative agreement, a fee of 3.45
    percent of the total value of grants and contracts is assessed for use
    of government-owned equipment in work for non-federal customers.
    Equipment fee revenues may be used at ITRI as DOE program funds as
    specified in 10 CFR 600. The lease clauses included DOE support for
    facility repair or replacement costs over $25,000. To terminate work
    under the previous Management and Operating contract, DOE agreed to pay
    costs incurred by reductions in workforce necessitated by the loss of
    DOE funding and not offset by new business.
        Upon privatization, DOE work by Lovelace in the leased ITRI
    facility continued under a five-year cooperative agreement, with total
    funding projected to decline progressively from approximately $13
    million in fiscal year 1997 to $4 million in fiscal year 2001. LRRI
    accepted the considerable challenge of developing new research and
    business activities that, at minimum, must offset the progressive loss
    of DOE support.
    Lovelace committed its organization to the privatization effort
        Enabled by the privatization of the ITRI facility, LRRI
    consolidated its multiple research and administrative operations into a
    single organization. The Institute then embarked on a rapid
    transformation that purposefully linked the future of the organization
    to its success in privatizing the ITRI facility. It recruited a new
    President/CEO oriented toward development of research business,
    narrowed its scientific focus to respiratory disease, out-placed
    research programs not aligned with this focus, combined and reduced the
    total size of administrative functions, shifted from a local to a
    national Board of Directors, implemented a multifaceted marketing
    program, consolidated its laboratory staff in the ITRI facility,
    undertook (at its own expense) several facility renovations, and
    subleased excess portions of both LRRI-owned and ITRI facilities.
                 the privatization has clearly been successful
    The research conducted in the facility has grown and diversified
        From fiscal year 1996 to fiscal year 1999 (to date), LRRI has
    increased its annual non-clinical research business from approximately
    $17 million to approximately $21 million. This increase has been
    attended by a considerable diversification of funding for work in the
    ITRI facility. In fiscal year 1996, before privatization, 71 percent of
    the work in the facility was supported by DOE, 12 percent by NIH, 9
    percent by other federal agencies, and 8 percent by non-federal
    customers. In fiscal year 1999 (to date), only 31 percent of the work
    in the facility is funded by DOE, 16 percent by EPA, 10 percent by NIH,
    10 percent by DOD, and 33 percent by non-federal sources. A total of
    $359 thousand in facility and equipment use fees has been collected
    from non-DOE clients to date.
        LRRI's success has supported the local economy through the
    retention of approximately 200 jobs directly within the Institute,
    which translates into approximately 1000 total jobs, most of which are
    in the local community.
        new federal research initiatives depend on continued use of the
                                    facility
    DOE has a continuing need for the facility
        It is clear that DOE itself has continuing need for the
    capabilities offered by LRRI and the ITRI facility. During fiscal year
    1999, DOE is funding approximately $700 thousand in new work obtained
    through competitive grants programs from various offices, and this work
    is intended to continue in future years. The Office of Heavy Vehicle
    Technologies has established a growing environment, safety, and health
    program concerning engine emissions, and LRRI is a major participant in
    this program. Indeed, the funding for LRRI work on engine emissions,
    made possible by the unique ITRI facility, nearly tripled from fiscal
    year 1998 to fiscal year 1999, and is envisioned to continue for
    several years.
       the environmental protection agency has a continuing need for the
                                    facility
        In fiscal year 1998, congress established the National
    Environmental Respiratory Center through the EPA appropriation as a
    multi-year research program to address the growing crisis of
    apportioning adverse health effects of environmental air pollution
    among the many constituents of air pollution mixtures. This program,
    developed by LRRI at the ITRI facility and unlike any other air
    pollution research effort in the nation, is essential to providing a
    foundation for the air pollution regulatory framework of the future.
    The work was made possible by the unique capabilities of the ITRI
    facility for creating in the laboratory complex mixtures of man-made
    and natural air contaminants, and conducting laboratory assays of the
    health effects of the mixtures. This body of research will be jointly
    funded by EPA, other federal agencies, states, and industry, and is
    intended to continue at a level of approximately $4 million/yr for at
    least six more years. In addition to the Center, EPA has funded several
    new projects at LRRI in response to competitive solicitations for work
    on airborne toxic materials and environmental lung disease.
    The Department of Defense has a continuing need for the facility
        As described above, research funding from DOD has grown, and the
    Agency clearly has a continuing need for the capabilities Lovelace
    offers at the ITRI facility. Recent examples are studies to resolve
    Gulf War Illness issues, the cancer hazards of depleted uranium
    fragments retained deep in tissue, and the detection of airborne
    biological agents.
        The ITRI facility is slated to play an increasing role in the
    development of new technologies to detect and mitigate chemical,
    biological, and radiological threats of both military and domestic
    importance. Based in part on the unique capabilities of the ITRI
    facility for working safely with very hazardous agents and creating
    atmospheres of airborne agents, a new working alliance has formed among
    LRRI, Sandia National Laboratories, Los Alamos National Laboratories,
    and the University of New Mexico. This new Research Alliance for Health
    and National Security will pool intellectual and technical resources to
    develop new technologies to detect and reduce threats, protect
    personnel, and stage and treat victims. Although each member
    organization brings special capabilities to the Alliance, the continued
    existence of LRRI's capabilities at the ITRI facility are central to
    the work plan.
    The National Institutes of Health has a continuing need for the
            facility
        NIH (NHLBI, NIEHS, NCI) continues to fund research utilizing the
    ITRI facility. One example is the multi-year Special Center of Research
    Excellence (SCORE) grant awarded jointly to the University of New
    Mexico and LRRI to conduct research on the causes of the continual
    increase in childhood asthma. Part of this work requires the
    specialized capabilities of ITRI to generate atmospheres of tobacco
    smoke and other air pollutant mixtures to determine their role in the
    development of asthma. NIEHS recently awarded a developmental center
    grant to the University of New Mexico, and a portion of the research
    requires the environmental research capabilities of the ITRI facility.
    There have been discussions with the Director of NIEHS regarding the
    potential use of the ITRI facility in a more direct manner to support
    the Agency's inhalation toxicology needs.
    The facility is also being used to support a growing technology
            business incubator
        LRRI is playing a key role in an effort involving other community
    groups to develop a technology business incubator program. The Business
    Technology Group (BTG) was formed in the fall of 1997 by LRRI, Sandia
    National Laboratories, the Albuquerque and Hispano Chambers of
    Commerce, the Albuquerque Department of Economic Development,
    Technology Ventures Corporation, the Center for Entrepreneurship, the
    University of New Mexico, and several private companies. Local
    incubator space was consolidated under the BTG, an Executive Committee
    was formed to direct operations, and an Evaluation Committee was formed
    to evaluate potential incubatees. LRRI provides a portion of the
    incubator space through subleases of the ITRI facility, and provides a
    wide range of administrative, scientific, and technical support
    services to the occupants.
        After only one year of operation, 41 new companies have already
    been served by this incubator, providing numerous jobs in the
    community, and several additional companies are either in negotiations
    with BTG or have expressed interest.
    There is an urgent need to resolve the long-term future of the facility
        Both DOE and LRRI can take satisfaction in the clear success of the
    exploratory privatization effort to date. The success of this effort
    provides a unique demonstration that it is possible to privatize
    government-owned research facilities and at the same time enhance their
    value as a national resource.
        It is now critical to build on this success by developing a long-
    term plan for the use and maintenance of the facility. LRRI and the DOE
    Albuquerque Operations Office are currently negotiating an extension of
    the lease, but this is not an adequate long-term solution. For example,
    even a revolving five-year lease would only permit LRRI to compete for
    multi-year projects during the first two of each five years, an
    arrangement which would ensure failure. It is important to note that
    this limitation is troublesome for both federal and non-federal
    customers, who have demonstrated their interest in maintaining programs
    in the facility, as well as for LRRI, which has structured its
    organization around the effort.
        There are several alternative possibilities for resolving this
    issue. For example, a longer-term (eg, 10 year) agreement with
    negotiation on future use beginning at the mid-point (eg, at five
    years) would be a step in the right direction. On the other end of the
    spectrum, it may be possible to convey ownership of the facility to
    LRRI or a community group. LRRI is open to discussing any possibility,
    including those that might require a legislative mandate.
        It is important to recognize that a long-term use arrangement can
    not succeed without provision for investment in the maintenance of the
    structures, heating and cooling equipment, etc. that are essential to
    the usefulness of the facility. The Agency would incur a considerable
    cost to decommission the facility if it were abandoned. It may be cost-
    effective for the Agency to mitigate or delay this cost may be offset
    by a modest investment in the facility. At a minimum, the use fees
    collected from non-DOE research sponsors should be used for this
    purpose.
                                     ______

      Prepared Statement of Dr. David E. Baldwin, Senior Vice President,
                            General Atomics, et al.
        Chairman Domenici, Senator Reid and Members of the Subcommittee, we
    are very pleased to submit this statement on the status of the fusion
    energy sciences program. We each believe that the nation's fusion
    research program is experiencing the most exciting and important new
    developments in a long time. We want to tell you about some of those
    changes and our developing plan for the future of fusion energy
    research.
        Fusion is a scientific and technological grand challenge. It has
    required the development of the entire field of high-temperature plasma
    physics, a field of science that contributes to the description of some
    99 percent of the visible universe. Plasma physics also provides cross-
    cutting insights to related fields such as nonlinear mechanics, atomic
    physics, and fluid turbulence. Quality science has always been the key
    to optimizing fusion systems. Throughout the history of fusion energy
    research, the combination of exciting, challenging science and the
    lofty energy goal has attracted gifted young people into fusion
    research, many of whom have gone on to make important contributions in
    related scientific fields and in the commercial technology arena.
        The DOE Fusion Energy Sciences program is exploring multiple paths
    for optimizing the fusion systems, taking advantage of both the strong
    international program in magnetic fusion energy and the strong DOE
    Defense Programs effort in inertial confinement fusion. As in other
    fields, the advancement of plasma science and technology requires
    facilities in a range of sizes, from the largest devices that press the
    frontier of high-temperature plasmas to smaller experiments suitable to
    begin the exploration of innovative ideas for fusion optimization. The
    very largest facilities may require international collaboration while
    the smallest are natural for university-scale investigation. Specific
    questions of plasma science and fusion technology set both the required
    number and the required scale of the experimental facilities in the
    program.
                          fusion approaches and issues
        There are two principal approaches to creating practical fusion
    energy: magnetic fusion energy (MFE) and inertial fusion energy (IFE).
    Scientific progress in both of areas has been profound over the past
    decade. For both MFE and IFE, there is little question that the
    generation of copious fusion energy in the laboratory is scientifically
    and technically achievable. Fusion energy production of over 20 MJ per
    pulse has already been achieved in MFE and is anticipated for IFE in
    NIF in 2008. The challenge to fusion researchers now is to make fusion
    power practical, affordable, and attractive. Each approach to fusion
    has a different mix of technical attributes. As it is presently unclear
    which approach will ultimately prove the most meritorious, a prudent
    fusion development strategy is one which retains breadth and well as
    depth in its scope and has a process for advancement of the most
    attractive concepts and elimination of noncompetitive approaches.
        Issues unique to MFE include (1) maximizing the pressure of the
    plasma that can be held by the confining magnetic field; (2) minimizing
    the transport loss of heat from the plasma; (3) achieving stable,
    steady-state operation in self-heated, burning plasmas; and (4)
    controlling of the plasma edge including exhaust of the fusion ash,
    which is helium. Issues unique to IFE include (1) completing the target
    physics program as part of the DOE DP Stockpile Stewardship Program;
    (2) developing an efficient, rep-rated driver for target compression;
    (3) developing low-cost methods for target fabrication, injection and
    tracking; and (4) developing chamber concepts capable of containing
    repeated micro-explosions over long periods. Issues in common include
    production of the tritium fuel, reduction of activation of the
    confining structure, and efficient conversion of neutron energy
    produced to electricity.
                     recent changes in u.s. fusion research
        As Members of this Subcommittee are well aware, the fusion energy
    sciences program has been through a number of very significant changes
    over the past few years. These changes have included substantial cuts
    to the program budget (nearly 40 percent between fiscal year 1996 and
    today) and the resulting termination of one major and several minor
    experiments, an increased emphasis on scientific understanding and
    innovative alternative approaches to fusion energy development, and the
    withdrawal of U.S. participation in the design of a major international
    fusion collaboration.
        One of the more significant recent developments to occur in the
    fusion program has been the closer alliance between inertial
    confinement fusion scientists and magnetic fusion energy scientists. As
    you are aware, the development of inertial confinement fusion has been
    pursued primarily as a means of providing insight into the physics of
    nuclear weapons and for maintaining the reliability of our nuclear
    weapons stockpile. While some work on inertial fusion energy
    development is funded through the fusion energy sciences budget, most
    of that budget is focused on the development of magnetic fusion energy
    and science.
        Recently however, scientific and technological progress in inertial
    fusion has led to increased confidence that inertial confinement may
    present another potentially attractive path to fusion energy. So,
    somewhat over a year ago, in response to this progress and to guidance
    from your Subcommittee, intensive discussions began between the
    leadership of the magnetic and inertial confinement fusion communities.
        Those discussions and the strengthening bond between the magnetic
    and inertial fusion communities has resulted in a new proposal or
    roadmap for the management of our nation's fusion energy research.
                a portfolio-based roadmap for fusion energy r&d
        The ultimate goal of fusion research is the creation of a nearly
    ideal energy source for future generations: one that is safe,
    inexhaustible, without harmful atmospheric emissions, and that has a
    fuel source readily available to all nations. After decades of R&D and
    many advances, the promise of fusion energy remains bright. Significant
    challenges, however, remain to fulfill this promise. In the nearer
    term, fusion research yields rich benefits in fundamental science and
    practical technology.
        Within the fusion community, we are in the process of developing a
    portfolio-based roadmap for the future of U.S. fusion research that we
    believe to be responsive to this subcommittee's directions.
        The central element of the roadmap is the exploration of a
    portfolio of promising ideas for improved fusion concepts, including
    improvements to the leading tokamak concept. This effort builds on the
    major advances in the knowledge of fusion physics, gained particularly
    over the last decade, coupled with greatly improved methods for
    measurement of critically important local plasma parameters. Promising
    ideas can be more readily identified in both MFE and IFE based on new
    understanding in areas like plasma turbulence, nonlinear instabilities,
    particle and radiation transport, MHD stability, wave-particle
    interactions, and the plasma/material interface. This naturally leads
    to the use of a ``portfolio'' approach. In order to provide a framework
    to assess the relative level of development among the different fusion
    concepts being pursued within MFE and IFE and to permit the application
    of appropriate objectives and criteria for success within the fusion
    portfolio, concepts are expected to advance through a series of
    distinct stages of experimental development. The lowest stage is
    identified as ``Concept Exploration'', then ``Proof of Principle'',
    followed by ``Performance Extension.'' Success in these stages then
    should lead to the technical and scientific basis for making a decision
    to advance the concept to a stage of ``Fusion Energy Development,'' and
    ultimately to a fusion demonstration power plant.
        This development roadmap is optimized to provide the most cost-
    effective route to the knowledge base for practical fusion power. At
    all times it balances the risk of innovative new ideas, pursued
    initially at low cost, with the scientific productivity of well
    established concepts, pursued in more powerful and expensive devices.
    An important aspect of this portfolio-management approach is that there
    is strong scientific synergy across the elements of the portfolio, and
    indeed scientific advances made in one concept are readily translated
    to others. The breadth of the portfolio assures that attractive
    opportunities are not missed, and roadblocks are not likely to span all
    approaches. It also broadens the arena of spin-offs from fusion
    research to other areas of U.S. science and technology.
                              fusion funding needs
        In developing this plan or roadmap for fusion research, we are
    trying to be responsive to both Congress's expressed concerns and to
    the long-term energy needs of the nation. The program seeks to broaden
    fusion research with a central theme of optimizing the fusion power
    source through application of the underlying science. However, this is
    necessarily a broader fusion program whose goals cannot be met at the
    current level of funding ($223 million in fiscal year 1999), and the
    fusion budget must be increased to $300 million per year in the near
    term. While still well below the funding of only a few years ago, this
    funding level will support a considerably broadened program in both MFE
    and IFE, enable initiatives like the new laser fusion initiative, allow
    for greater utilization of existing experimental facilities, ensure
    that potentially viable paths to fusion are not overlooked, and ensure
    continued measurable and substantial progress towards the ultimate goal
    of practical fusion energy.
      --Within MFE, there are today compelling and peer-reviewed near-term
            opportunities for investment in innovative confinement
            experiments (at a range of scales), new tools for the U.S.
            tokamak facilities to address advanced-tokamak issues and
            collaboration on the most powerful experimental facilities
            overseas. These investments will enable a broad, coordinated
            attack on key scientific and technical issues associated with
            the optimization of magnetic confinement systems and the
            achievement of the most attractive power plant concept.
      --Within IFE, exciting opportunities exist in parallel with the
            construction and operation of NIF, to demonstrate the
            principles for a range of potentially attractive drivers for
            repetitively imploding fusion targets (including both ion beams
            and lasers), to address associated fusion target chamber
            technologies, and to examine techniques for the mass
            manufacture of precision targets. New innovative driver and
            target concepts are also being developed, providing
            opportunities for new science and a potentially more attractive
            ultimate power plant.
      --In support of both areas there are opportunities in technology
            development, advanced simulation, and basic plasma science and
            technology.
        We recognize, however, that funding increases this year may be
    heavily constrained. In this event, to begin to broaden the fusion
    research agenda in fiscal year 2000, an appropriate level of support
    for the Fusion Energy Sciences program would be $260 million, including
    the $10 million needed to begin decommissioning of the DOE TFTR device
    at Princeton. This level would permit a start on the expanded IFE
    program and on important MFE opportunities which cannot be addressed at
    the current level.
        Thank you for the opportunity to submit this statement.
                                     ______

     Prepared Statement of Lynne P. Brown, Ph.D., Associate Vice President
    for Government and Community Relations, Center for Cognition, Learning,
                    Emotion and Memory, New York University
        Research into cognition, learning, emotion, and memory can help
    educators, physicians, and other health care givers, policymakers, and
    the general public by enhancing our understanding of normal brain
    development as well as the many disabilities, disorders, and diseases
    that erode our ability to learn and think, to remember, and to emote
    appropriately.
        New York University is seeking $10.5 million over five years to
    establish at its Washington Square campus a Center for Cognition,
    Learning, Emotion and Memory. The program will draw on existing
    research strengths in the fields of neural science, biology and
    chemistry, psychology, computer science, and linguistics to push the
    frontiers of our understanding of how the brain functions, and how we
    learn.
        Such exploration into the fundamental neurobiological mechanisms of
    the nervous system has broad implications for human behavior and
    decision making as well as direct applicability to early childhood
    development, language acquisition, teaching methods, computer science
    and technology development for education, the diagnosis and treatment
    of mental and memory disorders, and specialized training for stressful
    occupation.
         cognition, learning, emotion and memory studies at nyu (clem)
        New York University is poised to become a premier center for
    biological studies of the acquisition, storage, processing and
    retrieval of information in the nervous system.
        To be housed at NYU's Washington Square Campus within the Center
    for Neural Science, the new Center will capitalize on the university's
    expertise in a wide range of related fields that encompass our computer
    scientists who use MRI imaging for research into normal and
    pathological mental processes in humans, our vision scientists who are
    exploring the input of vision to learning and memory, our physical
    scientists producing magnetic measurements of brain function with a
    focus on the decay of memories, our linguists studying the relation of
    language and the mind, and our psychiatrists conducting clinical
    studies of patients with nervous system disorders.
        The New York University Program in Cognition, Learning, Emotion and
    Memory (CLEM) focuses on research and training in the fundamental
    neurobiological mechanisms that underlie learning and memory--the
    acquisition and storage of information in the nervous system. Current
    studies by the faculty at NYU are determining why fear can facilitate
    memory; how memory can be enhanced; what conditions facilitate long-
    term and short-term memory; and where in the brain all these memories
    are processed and stored. The research capacity of this Center
    capitalizes on our expertise in physiology, neuroanatomy, and
    behavioral studies, and builds on active studies that range from the
    mental coding and representation of memory to the molecular foundations
    of the neural processes underlying emotional memories. Our faculty use
    electrophysiological and neuroanatomical techniques to study the
    organization of memory in the medial temporal lobe. Together these
    researchers bring substantial strength in psychological testing,
    computational sophistication, advanced tissues staining and electrical
    probes, and humane animal conditioning.
        These core faculty are well recognized by their peers and have a
    solid track record of sustained research funding from federal agencies
    and private foundations: total costs awarded and committed for their
    research for full project periods from all sources presently total $7
    million. Additional faculty are being recruited in areas of
    specialization that include: the cellular and molecular mechanisms
    operative in neural systems that make emotional memory possible,
    neurophysiological studies of memory in non-human primates,
    computational modeling of memory, and neuropsychological and imaging
    research on normal and pathological human memory.
        Colleagues in the Biology Department are doing related work in the
    molecular basis of development and learning. Given the important input
    of vision to learning and memory, the Center has strong links with the
    many vision scientists based in the Psychology Department who work on
    directly related topics that include form, color, and depth perception,
    memory and psycholinguistics. Colleagues in behavioral science study
    learning and motivation, memory and aging. Physical scientists explore
    the magnetic measurement of brain function, with a focus on the decay
    of memories. CLEM also shares research interests with colleagues in the
    Linguistics Department, who study the relation of language and the
    mind.
        Research linkages extend to computational vision studies, now
    centered in NYU's Sloan Program in Theoretical Neurobiology. The Sloan
    Program works closely with computer scientists at our Courant Institute
    on Mathematical Science, with colleagues at the Medical Center in
    Psychiatry, who use MRI imaging for research into normal and
    pathological mental processes in humans, and in Neurobiology, who are
    conducting clinical studies of patients with nervous disorders,
    especially memory disorders.
        What is unique and exciting about the establishment of such a
    comprehensive center at NYU is the opportunity to tap into and
    coordinate this rich multidisciplinary array of talent to conduct
    pioneering research into how the brain works. In this, the ``Decade of
    the Brain,'' NYU is strategically positioned to be a leader.
                         early childhood and education
        Research into the learning process as it relates to attention and
    retention clearly holds important implications for early childhood
    development. Although most of a person's brain development is completed
    by birth, the first few years of life are critically important in
    spurring intellectual development. For example, research has already
    shown that in their early years, children need human stimulation, such
    as playing and talking, to develop the ability to learn.
        With more immigrant children in schools, language development is
    another crucial area of study. If a child's brain were more receptive
    to acquiring sounds during the first few months of life, and language
    in the first few years of life, then students may learn a second
    language more quickly if taught in the lower grades instead of waiting
    for high school.
        In the midst of a national debate on education reform, thousands of
    education innovations are being considered without the advantage of a
    fundamental understanding of the learning process. CLEM researchers,
    coupled with educational psychologists, can contribute to a better
    understanding of how parents can stimulate their children's cognitive
    growth, how children learn at different stages and use different
    styles, how educators can accommodate those styles, and how educational
    technology can be harnessed to increase retention and memory.
        At NYU, these efforts will be enhanced by our scholars and research
    conducted in our School of Education and our New York State-supported
    Center for Advanced Technology.
                  computer science and technology development
        As we refine our knowledge of how the brain acquires, processes,
    retains and retrieves information and images, we will also be able to
    improve the design, development and utilization of computer science and
    technology. As we reach a better understanding of how children learn,
    we can more effectively harness computer technology in the service of
    education.
        At NYU, this effort is enhanced by the presence of our New York
    State-supported Center for Digital Multimedia, Publishing and
    Education, which brings together educators, laboratory scientists and
    software designers who explore how interactive multimedia technologies
    enhance learning and develop prototype teaching models.
                              specialized training
        Research into how cognition and emotion interact can have
    applicability to other diverse areas of interest including retraining
    of adult workers, job performance and specialized training for high
    risk or stressful jobs such as military service and emergency rescue
    work.
        Accordingly, we believe that the work of this Center is an
    appropriate focus for the Department of Energy, given the Department's
    long-term involvement and investment in computer science technology
    through its Basic Energy Sciences program. The focus of the NYU Center
    for Cognition, Learning, Emotion and Memory is entirely consistent with
    the Department's commitment both to the Basic Energy Sciences,
    including computer science, and to its commitment to Biological and
    Environmental Research. We have demonstrated how scientists from a
    broad range of biological sciences are working together with leading
    mathematics and computer science researchers to achieve a better
    understanding of how the brain functions and how we learn. The
    Department's commitment to education and to science will be well served
    through this partnership.
                                     ______

         Prepared Statement of Kerry L. Sublette, Sarkeys Professor of
                 Environmental Engineering, University of Tulsa
        It is proposed that the U.S. Department of Energy support a
    focused, university-based program, the Integrated Public/Private Energy
    & Environmental Consortium (IPEC), with the goal of increasing the
    competitiveness of the domestic energy industry through a reduction in
    the cost of compliance with U.S. environmental regulations. Federal
    support is specifically requested as part of the fiscal year 2000
    appropriation for the Department of Energy through the Biological and
    Environmental Research account or other source the Subcommittee may
    determine to be appropriate.
        Last year the Congress provided $1.5 million in funding for the
    Integrated Public/Private Energy & Environmental Consortium (IPEC)
    (formerly the Integrated Petroleum Environmental Consortium) in the
    fiscal year 1999 appropriations bill for the Environmental Protection
    Agency (EPA). Specially this funding was provided for the development
    of cost-effective environmental technology, improved business
    practices, and technology transfer for the domestic energy industry.
    With initial funding under the Science and Technology account of EPA,
    IPEC will implement a comprehensive mechanism (Center) to advance the
    consortium's research expertise in environmental technology. The
    consortium includes the University of Tulsa, the University of
    Oklahoma, Oklahoma State University, and the University of Arkansas.
        IPEC's operating practices and linkages to the independent sector
    will ensure that real problems in the domestic energy industry are
    addressed with real, workable solutions. Indeed this Subcommittee
    highlighted and supported these efforts by including strong support
    language in the committee report. We thank you for your support and
    would also like to express our appreciation to those members and their
    staff who provided valuable advice and guidance during the last session
    of Congress. As envisioned and proposed by the consortium, State-level
    matching funds have been pledged to support IPEC, creating a true
    Federal-State partnership in this critical area.
        IPEC officers have met with the Director of the Environmental
    Engineering Research Division of the EPA National Center for
    Environmental Research and Quality Assurance. The Consortium is working
    with EPA to ensure that we meet the agency's requirements for funding
    as a research center and the successful funding of IPEC.
        IPEC is proceeding in its solicitation and review process so that
    we will be in a position to fund projects as soon as possible. The IPEC
    Industrial Advisory Board (IAB) has been formed and met for the first
    time on January 20, 1998. This twenty-member Board is composed of
    environmental professionals from the domestic energy industry and is
    dominated by representatives of independent producers. We are pleased
    to report that IPEC's Industrial Advisory Board has approved five
    programs for funding and more are expected in the coming months. These
    five projects include the following:
        (1) Intrinsic bioremediation of whole gasoline.--This project seeks
    to develop a scientific basis for a risked-based approach to management
    of sites contaminated with gasoline. The project will investigate the
    mechanism and rate of the natural attenuation of gasoline via
    biodegradation by microorganisms which occur naturally in soil (termed
    intrinsic bioremediation). If all of the regulated components of
    gasoline can be naturally biodegraded, then contaminated sites which
    pose no immediate threat to human health or environmental receptors can
    be given a low priority for active intervention freeing precious
    resources to be allocated to sites where the threat is more acute.
        (2) Microflora involved in phytoremediation of polyaromatic
    hydrocarbons.--Phytoremediation is the term applied to the use of
    plants and microorganisms that thrive in the plant's root zone to
    biodegrade soil pollutants such as polyaromatic hydrocarbons (PAHs).
    PAHs are a major class of recalcitrant pollutants and are a significant
    byproduct of petroleum processing and refining. PAHs are concentrated
    in food chains, are toxic, and some are recognized mutagens and
    carcinogens. This project will determine the feasibility of using
    plants to degrade these PAHs in contaminated soil by creating a
    ``living cap'' of plants and associated microorganisms over
    contaminated sites. The costs of such waste treatment are far below
    those required for conventional treatment such as excavation and
    incineration of contaminated soil.
        (3) Passive sampling devices (PSDs) for bioavailability screening
    of soils containing petrochemicals.--The concept of a risk-based
    corrective action applied to the management of contaminated soil or
    groundwater requires that a regulator assess human risk. Soil
    contaminants can be detected by chemical analysis, but this provides
    little information on the actual hazard presented to ecological and
    human receptors. In some cases, contaminant levels above current soil
    quality guideline levels exists, but not toxicity. In other cases,
    chemical levels are below soil quality guidelines, yet toxicity
    persists. This project seeks to develop a rapid, cost effective
    screening tool or passive sampling device (PSD) to determine the actual
    toxicity of contaminants in soil and their bioremediation potential.
    Use of such a device to determine the actual risks to human health
    presented by a site and its amenability to bioremediation would allow
    regulators to better prioritize contaminated sites needing immediate
    remedial action.
        (4) Using plants to remediate petroleum-contaminated soil.--This
    project also proposes to use plants and associated microorganisms in
    the plants root zone to effect the remediation of soil contaminants.
    This project specifically seeks to conduct field studies to develop
    protocols suitable for phytoremediation of petroleum-contaminated
    secondary containment berms. These earthen berms are designed to
    contain fluids in the event of a major spill or leak in a tank. Many of
    these berms become contaminated with oil through leaks, spills, and
    normal transfer operations. This project envisions the continuous
    cultivation of suitable plants on these berms to keep oil contamination
    under control.
        (5) Probabilistic risk assessment of petroleum contamination using
    detailed physical models.--Like all human endeavors the exploration and
    production (E&P) of oil and gas has associated with it some risk of
    damage to human or environmental health. Response to this risk can be
    reactive or proactive. The latter is of course preferred since
    proactive management prevents environmental damage and injury and is
    less costly. This project will develop a proactive risk management
    program for E&P operations to minimize the potential for environmental
    damage. This risk-based approach makes resource allocation more
    effective based on the probability that a scenario will occur and the
    potential severity of the associated damage. Proactive risk management
    in the domestic petroleum industry has the potential for both
    significant cost savings and enhanced environmental protection.
        The use of the Industrial Advisory Board to measure the relevancy
    of research within the Consortium is truly unique and ensures that the
    Consortium is meeting the needs of the domestic energy industry. IPEC
    has secured significant matching funds from industry for these first
    five programs. The combined funding request for these five projects is
    $492,000; however, the investigators have secured another $502,000 in
    matching funds from industry for these projects from individual
    companies and industry organizations such as the Gas Research
    Institute, the American Petroleum Institute and the Petroleum
    Environmental Research Forum. IPEC is well on its way to becoming a
    true public/private partnership.
        As we have previously testified, the ability of small and medium
    sized producers to compete in a global market is complicated by two
    factors: the cost of regulatory compliance and the declining cost of
    crude oil. With your help IPEC is developing cost-effective solutions
    for the environmental problems that represent the greatest challenge to
    the competitiveness of the domestic energy industry. However, the
    fiscal year 1999 appropriation is only a beginning. For example, the
    IPEC Industrial Advisory Board has identified 26 critical research
    needs. With the current funding we can begin to address only a fraction
    of these needs. There is much work to be done and we respectfully
    request that the Subcommittee provide $4 million in funding for IPEC in
    fiscal year 2000.
             the continuing crises in the domestic energy industry
        The crisis in the domestic energy industry that we described in
    testimony in the last session of Congress has only gotten worse as the
    price of crude oil continues to fall to below $13 per barrel. The
    independent producers are producing from mature fields left behind by
    the majors. Although there is a significant resource base in the fields
    this is the most difficult and the most costly oil to produce. The
    independent producer has only one source of revenue--the sale of oil
    and gas. There is no vertical depth to his business. With the price of
    oil this low the independent producer is extremely vulnerable to the
    costs of environmental compliance. This latest drop in oil prices will
    no doubt result in another wave of business closures, plugged and
    abandoned wells, and reduced new well completions. The problem is so
    acute that the Governor of Oklahoma has recently formed an emergency
    task force to determine what the state can do to help Oklahoma
    producers survive the current plunge in prices. A similar price crash
    in the 1980s triggered a prolonged statewide recession. Clearly this
    trend is not in the best interest of the U.S. in terms of energy self-
    sufficiency or national security. We are turning over control of our
    cost of production in terms of energy costs to foreign interests. If
    domestic exploration and production and refining are to continue to
    play a strategic role in meeting U.S. energy needs, the domestic
    petroleum producer will continue to require access to cost-effective
    technology for pollution prevention, waste treatment and remediation in
    exploration and production (E&P) and refining.
                   ipec's response to critical research needs
        IPEC will continue to work with the domestic energy industry to
    provide solutions to those environmental problems that represent the
    greatest challenge to the competitiveness of the industry. Specifically
    in fiscal year 2000 IPEC will continue to work with our Industrial
    Advisory Board to address the remaining critical research needs they
    have identified as well as address new needs that develop. These
    research needs include the following:
        (1) Bioremediation and other remediation technologies.--Reducing
    toxicity of hydrocarbon-contaminated soils; development of rapid, on-
    site remediation technologies; control of salt migration in the
    subsurface; developing methodologies for phytoremediation.
        (2) Risk Assessment.--Development of cost-effective ecological risk
    assessment methods for petroleum impacted sites; development of cost-
    effective and relevant terrestrial (animal/plant) bioassays for use in
    ecological risk/impact assessment; development of field methods for
    ecological risk assessment; development of methods to evaluate actual
    and future environmental risk of petroleum impacted soils; determining
    the correlation between ecological risk assessment and human health
    risk assessment; determining the impact of intrinsic bioremediation on
    risk-based closures; development of risk-based guidelines for handling,
    disposal and storage of NORM-contaminated solids, pipe, and equipment.
        (3) Measurement Technology.--Development of cost-effective methods
    (direct and indirect) for measuring the amount and extent of petroleum
    hydrocarbon sources in unsaturated and saturated soils; development of
    useful and easy to implement field and analytical methods and protocols
    for demonstrating intrinsic bioremediation; validating current models
    for predicting flash emissions of hydrocarbons in E&P operations.
        (4) Process Technologies.--Control or treatment of flash gas
    emissions from stock tanks; use, treatment or disposal of oil tank
    bottoms; development of cost-effective methods for capture, recycling/
    destruction of volatile organic compound emissions from hydrocarbon
    processing and storage tanks; development of improved water treatment
    methods--particularly those methods; development of methods to for
    treatment of hydrogen sulfide in the reservoir.
        (5) Management and Decision Tools.--Development of methods to
    predict plume migration of salt water from pits; development of methods
    to calculate the full life cycle cost of material and waste handling in
    the petroleum industry; development of proper pit closure methods using
    a clay or compacted soil cap; development of improved methods for
    disposal of drilling wastes; development of methods to distinguish
    between historical oil field pollution and recent, current and/or
    ongoing pollution.
        In addition to working with our Industrial Advisory Board, IPEC
    will continue in fiscal year 2000 to build linkages with organizations
    which provide services to the domestic energy industry. As IPEC begins
    to fund technology development projects the Directors will work with
    the leadership of these organizations to develop a synergy between
    their efforts and those of IPEC. These organizations form the IPEC
    Affiliates Group and include the National Petroleum Technology Office
    (NPTO) of the U.S. Department of Energy, the Interstate Oil and Gas
    Compact Commission (IOGCC), the Petroleum Environmental Research Forum
    (PERF) the Oklahoma Energy Resources Board (OERB), the Oklahoma
    Independent Petroleum Association (OIPA), the Gas Research Institute
    (GRI), the Office of the Oklahoma Secretary of Energy, the Osage Agency
    of the Bureau of Indian Affairs and the Oil Producers of Arkansas
    (OPA). Recently, Governor Frank Keating of Oklahoma named the IPEC
    Director to the Environmental and Safety Committee of the IOGCC.
    how ipec's objectives are consistent with the mission of the biological
                       and environmental research program
        Although IPEC's close ties to the independent sector of the
    domestic energy industry have resulted in a strong working relationship
    with the National Petroleum Technology Office in the Office of Fossil
    Energy, IPEC continues to have broad applicability across the
    Department of Energy. Biological treatment of waste materials and
    bioremediation of contaminated media such as water, air and soil are
    widely recognized as potentially the most cost effective treatment
    methodologies available for many types of wastes. Petroleum
    hydrocarbons are both the most widely distributed class of
    environmental pollutants and the most amenable to biological treatment.
    These facts have certainly been recognized by the IPEC Industrial
    Advisory Board in that of the five research projects approved thus far
    by the IAB as relevant to IPEC's mission, four concern the use of
    plants and microbes to treat contaminated soils. Further, of the
    critical research needs identified by IPEC's Industrial Advisory Board
    fully half concern bioremediation, phytoremediation, ecological risk
    assessment, and toxicity issues. These topics are clearly within the
    mission of the DOE BER Program.
        The mission of the Biological and Environmental Research (BER)
    Program under Environment, Safety and Health is to ``develop the
    knowledge needed to mitigate or correct the consequences of energy use
    while contributing to the education and training of the scientific work
    force''. This is identically the mission of IPEC when applied to the
    domestic energy industry. IPEC will use academic scientists and
    engineers in partnership with industry to develop new, cost-effective
    technology to solve environmental problems which are having a major
    economic impact on the domestic energy industry. These academic
    investigators will utilize undergraduate and graduate students in the
    sciences and engineering in these projects resulting in the training of
    new environmental professionals.
        An example of an innovative petroleum environmental technology
    which fulfills the mission of the BER Program is intrinsic
    bioremediation of petroleum hydrocarbons. Intrinsic bioremediation is
    the application of indigenous microorganism to the attenuation of
    hydrocarbons which contaminate soil and groundwater. It has recently
    been shown that many petroleum hydrocarbons will be biologically
    degraded in soil and groundwater even in the absence of oxygen and
    without active intervention. These observations suggest that if no
    environmental receptor (drinking water aquifer, stream or lake) is
    immediately threatened, no intervention may be necessary to remediate
    certain spills. This conserves financial resources for application to
    other problems where the actual risks to public health are significant.
    However, intrinsic bioremediation is not sufficiently well understood
    at present to safely make these types of judgments. A better
    understanding of the rate and extent of natural attenuation of
    petroleum hydrocarbons in the subsurface will require a multi-
    disciplinary approach analogous to the BER subsurface science program.
    The response of ``biological systems to local disturbances resulting
    from energy-related activities'' is a key element of both the BER
    Program and IPEC's investigations of intrinsic bioremediation.
        IPEC is in the second year of a major three-year effort to address
    an important problem in the exploration and production of petroleum and
    natural gas: the remediation of hydrocarbon-impacted soil and
    groundwater. The project is funded by the Biological and Environmental
    Research (BER) Program of DOE ($973,000) with cost share from Amoco
    Production Co. Specifically this research is investigating the
    mechanisms of the natural biodegradation or intrinsic bioremediation of
    hydrocarbons in the subsurface with the goal of providing a sound
    scientific basis to support risk-based regulatory decisions at
    hydrocarbon-contaminated sites.
                                funding of ipec
        IPEC is seeking appropriations of $4 million for fiscal year 2000
    and the succeeding fiscal years 2001, 2002, and 2003 through the
    Department of Energy. The consortium will be responsible for at least a
    50 percent match of federal appropriations with private sector and
    state support over a four year period. The Consortium will be subject
    to annual review to ensure the effective production of data, regulatory
    assessments, and technology development meeting the stated goals of the
    Consortium.
                                     ______

       Prepared Statement of Robert L. McCrory, Professor and Director,
            Laboratory for Laser Energetics, University of Rochester
                          summary and requested action
        The inertial confinement fusion (ICF) program is a key element in
    the Department of Energy's (DOE) Stockpile Stewardship Program (SSP) to
    ensure the reliability and credibility of the U. S. nuclear weapons
    stockpile. The ICF program provides access to high-energy-density
    physics data important in nuclear weapon design and understanding. In
    fiscal year 2000 the program will be focused on the use of available
    unique laboratory facilities: OMEGA at the University of Rochester's
    Laboratory for Laser Energetics (LLE), Z at Sandia National
    Laboratories (SNL), and the Nike laser at the Naval Research Laboratory
    (NRL). Significantly, the discontinuation of a major, older facility,
    the Nova laser at Lawrence Livermore National Laboratory (LLNL) in
    fiscal year 1999, requires the shift of many experiments conducted by
    the weapons laboratories to the OMEGA facility at LLE. Experiments on
    ICF facilities support the demonstration of thermonuclear ignition and
    gain on the National Ignition Facility (NIF) now under construction at
    LLNL. The facilities also provide data in support of the nuclear
    weapons science-based stewardship activities of the Nation.
        LLE, a major participant in ICF research since the 1970s, is the
    only ICF program that has been jointly supported by the Federal
    government, State government, industry, utilities, and a university. At
    relatively small comparative cost, LLE makes fundamental scientific
    contributions to the National program and the Laboratory makes
    available technology to the public and private sectors through
    interactions with industry and other Federal laboratories. In addition,
    the Laboratory trains graduate students with the unique facility.
    Finally, the Laboratory serves as a National laser users' facility
    benefiting scientists throughout the country. The OMEGA laser, the
    highest power ultraviolet fusion laser in the world, will be the
    principal laser facility for SSP activities for DOE in fiscal year
    2000.
        The Laboratory's primary ICF mission is to validate the direct-
    drive option for ICF. OMEGA is also required to meet mission-critical
    requirements for the indirect-drive ignition plan developed by DOE for
    the NIF. Without LLE, the DOE schedule to demonstrate ignition and gain
    in the laboratory, the objective of the NIF program, cannot be
    realized. OMEGA with its 60 beams is also used for indirect-drive
    experiments in collaboration with the National laboratories for SSP
    experiments, including classified experiments.
        OMEGA is the only facility that can demonstrate the scientific
    potential of direct drive to provide a modest-to high-gain energy
    option for the Nation. ICFAC1 emphasized the priority of conducting
    cryogenic experiments on OMEGA beginning in fiscal year 1999. OMEGA is,
    and will continue to be, the principal facility in the National program
    for ICF-based stockpile stewardship experiments until the NIF is
    completed in fiscal year 2004. Beyond 2004, OMEGA will continue to be
    used when full NIF energy or capability is not required, particularly
    since the cost per shot on OMEGA is considerably less costly than a NIF
    shot. Additionally, the repetition rate of OMEGA (one shot per hour) is
    substantially higher than that planned for NIF (several shots per day).
        To provide the operations support for program deliverables and
    operation of OMEGA (for both cryogenic and SSP experiments), and
    maintain the training programs at Rochester, a total authorization and
    appropriation of $30,500,000 is requested for the University of
    Rochester for fiscal year 2000, as contained in the Administration's
    budget request for DOE.
                                   background
        Thermonuclear fusion is the process by which nuclei of low atomic
    weights, such as hydrogen, combine to form higher atomic weight nuclei
    such as helium. In this process some of the mass of the original nuclei
    is lost and transformed to energy in the form of high-energy particles.
    Energy from fusion reactions is the most basic form of energy in the
    universe; our sun and other stars produce energy by thermonuclear
    fusion reactions occurring in their interior. Fusion is also the
    process that provides the vast destructive power of thermonuclear
    weapons.
        To initiate fusion reactions, the fuel must be heated to tens of
    millions of degrees. In ICF the heating and compression of fusion fuel
    occurs by the action of intense laser or particle beam drivers. There
    are two approaches to ICF, direct and indirect drive: indirect drive
    involves the conversion of beam energy to x rays to compress a fuel
    capsule in an enclosure called a hohlraum; direct drive involves the
    direct irradiation of a spherical fuel capsule by energy from a laser
    and may be more efficient energetically than indirect drive. In either
    approach, if very extreme density and temperature conditions are
    produced, it is possible to produce many times more energy in these
    fusion reactions than the energy provided by the drivers.
                   inertial confinement fusion program focus
        DOE has accepted the recommendations of independent reviews,\1\ \2\
    and construction of the NIF is in progress. The purpose of the NIF, in
    its SSP mission, includes the demonstration of ignition, propagating
    burn, and modest gain in the laboratory. The NIF project completion is
    projected to be 2004. Beginning in fiscal year 2000, while NIF is under
    construction, OMEGA will be the principal ICF facility used for nuclear
    weapons stewardship experiments by LLNL and LANL, and for direct-and
    indirect-drive ICF experiments.
        LLE is the primary focus in the U. S. for the direct-drive approach
    to ICF. Direct drive may ultimately prove to be the best approach to
    ICF and provide the most efficient path to a laboratory-scale
    thermonuclear capability for both energy research and defense
    technology needs. OMEGA is the only facility that can demonstrate the
    scientific potential of direct drive to provide modest to high gain on
    the NIF.
        In addition to the ICF experimental program, LLE is a major
    participant in NIF design and construction. At present, LLE is
    fabricating the large polarizers and transport mirrors for the NIF, and
    LLNL has also recently decided to have LLE coat, assemble, and test the
    NIF deformable mirrors. LLE is the lead laboratory working with DOE and
    the other participants to formulate the plan for the direct-drive
    ignition campaign on the NIF. In collaboration with the other ICF
    laboratories, LLE is also developing several advanced diagnostics
    required for NIF experiments (see below).
        An extensive collaborative program between LLNL, LANL, and LLE has
    provided data on basic physics, beam smoothing, and unstable
    hydrodynamics using available lasers. This collaboration on OMEGA
    includes both nuclear weapons physics experiments and ICF experiments.
    Physics issues for both ICF and weapons issues for the SSP fall into
    five broad categories: irradiation uniformity, laser energy coupling
    and transport, laser-plasma interaction physics, hydrodynamic
    stability, and hot-spot and main-fuel-layer physics. The OMEGA and NIF
    programs are complementary. Figure 1 illustrates the schedule for the
    glass laser facilities to be used in the National program plan for
    inertial fusion and shows the phased availability plan for the NIF.
    [GRAPHIC] [TIFF OMITTED] T10NDP.013

        The figure illustrates how the National program has been structured
    to provide a full complement of mature experimental facilities from the
    present to the future. With the termination of Nova laser operations in
    fiscal year 1999, OMEGA becomes the Nation's principal facility to
    continue experimental work during NIF construction. Both LANL and LLNL
    will continue to use OMEGA for indirect-drive experiments for ICF and
    SSP experiments for the foreseeable future. Because of the high
    interest and utility of the OMEGA facility to the weapons laboratories,
    DOE's budget request includes funds for extended operations on OMEGA
    for SSP experiments. With its lower per-shot cost compared to NIF, as
    well as the higher shot-repetition rate, OMEGA will be a very important
    supporting facility for experiments and diagnostic development for the
    NIF after it's completion in 2004 (see Fig. 1).
               the lle direct-drive program for fiscal year 2000
        The goal of the glass-laser direct-drive target physics program is
    to evaluate the performance of fuel capsules near ignition conditions.
    OMEGA is also the first facility to attempt the fielding of high-fill-
    pressure cryogenic DT capsules, the basis for the principal capsule
    design to be used in the NIF indirect-drive ignition demonstration. In
    addition to providing data for the NIF, these experiments are required
    to validate the direct-drive configuration on the NIF that could result
    in two to three times higher fusion gains (gain > 50) than those
    available with the baseline (indirect-drive) NIF design.
        An important element of the direct-drive program on OMEGA is to
    demonstrate on-target irradiation uniformity of 98 percent to 99
    percent. The realization of this goal is a principal objective for
    fiscal year 2000. OMEGA is also being used to develop and test
    diagnostics for NIF. Cryogenic fueling and target experiments on OMEGA
    are necessary to demonstrate the likelihood of success of the direct-
    drive option of NIF. Additionally, the OMEGA cryogenic system serves as
    an engineering test-bed to support NIF cryogenic development. In
    collaboration with LANL and General Atomics, the cryogenic capability
    will be completed in fiscal year 1999 with the first fully cryogenic
    capsule experiments planned for OMEGA in fiscal year 2000. The ICFAC
    \1\ recommended in their final report: ``The committee believes that
    experiments are essential to assessing real target performance and
    benchmarking code calculations. The first opportunity to do such
    experiments on cryogenic targets approaching NIF size will be on OMEGA
    . . . It is very important that this effort be kept on track with
    proper priority and not delayed further.'' \1\ A cryogenic capability,
    advanced diagnostics development (including fusion-product charged-
    particle diagnostics, -ray detection, and high-dynamic-range
    optical and x-ray streak cameras), and beam smoothing are all required
    for the NIF. LLE is the principal National facility to develop these
    technologies for the program. LLE's design and testing of two-
    dimensional smoothing by spectral dispersion and fabrication
    capabilities for the large polarizers, transport optics, and deformable
    mirrors for the NIF are essential to its completion and success.
        LLE provides education and training in the field of ICF and related
    areas for personnel with expertise in areas of critical National needs.
    These include theoretical and experimental plasma physics, laser-matter
    interaction physics, high-energy-density physics, x-ray and atomic
    physics, ultrafast optoelectronics, high-power laser development and
    applications, nonlinear optics, optical materials, and optical
    fabrication technology. One hundred eighteen University of Rochester
    students have earned Ph.D. degrees at LLE since its founding. Forty-
    eight graduate students from other universities were funded by NLUF
    grants. A total of 34 graduate students and 14 faculty members of the
    University of Rochester are currently involved in the unique research
    environment provided at LLE and represent many departments within the
    University, including Mechanical Engineering, The Institute of Optics,
    Physics and Astronomy, Electrical Engineering, and Chemical
    Engineering. Beyond this, more than 50 undergraduate students receive
    research experience annually at LLE. Additionally, a high-school summer
    science program exposes ten talented students each year to the research
    environment and encourages them to consider careers in science and
    engineering. Many LLE graduates have made important scientific
    contributions in National laboratories, universities, and industrial
    research centers.
                                   references
        \1\ Inertial Confinement Fusion Advisory Committee Report to
    Assistant Secretary Reis (February 21, 1996).
        \2\ ``Science Based Stockpile Stewardship,'' JASON Report JSR-94-
    345 (The MITRE Corporation, McLean, VA, November 1994).
                                     ______

     Prepared Statement of the University of Medicine and Dentistry of New
                                     Jersey
        The following is the testimony of the University of Medicine and
    Dentistry of New Jersey (UMDNJ), the largest public health sciences
    university in the nation. The UMDNJ statewide system is located on five
    academic campuses and consists of 3 medical schools, and schools of
    dentistry, nursing, health related professions, public health and
    graduate biomedical sciences. UMDNJ also comprises a University-owned
    acute care hospital, three core teaching hospitals, an integrated
    behavioral health care delivery system, a statewide system for managed
    care and affiliations with more than 100 health care and educational
    institutions statewide. No other institution in the nation possesses
    the resources which match our scope in higher education, health care
    delivery, research and community service initiatives with state,
    federal and local entities.
        We appreciate this opportunity to bring to your attention the
    priority projects of UMDNJ that are consistent with the biomedical
    research mission of the Department of Energy and Water. These include
    the Child Health Institute of New Jersey, the Neurological Institute of
    New Jersey, efforts to combat infectious disease and chemical and
    biological terrorism, and our collaboration with the Department of
    Energy on its environmental clean-up efforts.
        Our first priority is the Child Health Institute of New Jersey at
    the UMDNJ-Robert Wood Johnson Medical School (RWJMS) in New Brunswick,
    New Jersey. As part of the state's public higher education system, the
    medical school's 2,500 full-time and volunteer faculty train about
    1,500 students in medicine, public health and graduate programs and
    ranks in the top one-third of the country with regard to the percentage
    of its students who practice in primary care specialties after
    completing their residency training. The School ranks in the top one-
    third in the nation in terms of grant support per faculty member. RWJMS
    is also home to The Cancer Institute of New Jersey, the only NCI-
    designated clinical cancer center in New Jersey; The Center for
    Advanced Biotechnology and Medicine; the Environmental and Occupational
    Health Sciences Institute, the largest environmental institute in the
    world; and the Child Health Institute of New Jersey.
        The Child Health Institute is a comprehensive biomedical research
    center focused on the health and wellness of children. In this program,
    medical researchers direct efforts toward the prevention and cure of
    environmental, genetic and cellular diseases of infants and children.
    The Institute is integral to the long-term plan for the enhancement of
    research at the medical school in developmental genetics, particularly
    as it relates to disorders that affect a child's development and
    growth, both physically and cognetively.
        The program will enable the medical school to expand and strengthen
    basic research efforts with clinical departments at the Robert Wood
    Johnson University Hospital and with the new Children's Hospital in the
    areas of Obstetrics, Pediatrics, Neurology, Surgery and Psychiatry. The
    Child Health Institute will fill a critical gap in services through the
    recruitment of an intellectual base upon which basic molecular programs
    in child development will build.
        The Child Health Institute will focus research on the molecular and
    genetic mechanisms which direct the development of human form,
    subsequent growth, and acquisition of function. Broadly, faculty and
    students will investigate disorders that occur during the process of
    development to discover and study the genes contributing to
    developmental disabilities and childhood diseases; to determine how
    genes and the environment interact to cause childhood diseases; and to
    identify the causes and possible avenues of treatment of cognitive
    disorders broadly found among conditions such as mental retardation,
    autism and related neurological disorders.
        Normal child development is a water dependent process, reflecting
    water quality, quantity and its 19management' by cells and tissues.
    Access to uncontaminated water is at the base of the tree of life.
    Pollution of aquatic ecosystems poses a serious threat to the entire
    ecosystem and studying how a toxin affects embryonic development is
    central to understanding the risks pollutants represent, whether
    derived from pesticides, industrial run-off, acid rain or landfills. In
    multiple ways, the embryo is a sentinel for environmental toxins.
    Research at the Child Health Institute will focus on molecular
    mechanisms of early embryonic development, a natural, but vulnerable
    water-based environment. Sixty percent of the weight of the average
    human is contributed by water. The average 150 lb man contains about 40
    to 45 quarts of waters, approximately 6 quarts of which is circulating
    in the blood, and 39 quarts are within and between the cells of each
    and every organ. The embryo is even more highly hydrated than the
    adult. During development the embryo undergoes rapid changes in size
    and shape requiring rapid changes in the structures and cells present
    in any one tissue. In order to accommodate these rapid and essential
    changes, the embryo is rich in molecules which have a very high water
    binding capacity. After birth, the water in tissues allows cells to
    continue to move about within the embryo with ease and also promote
    fluid movement in blood vessels, the gastrointestinal tract and the
    airways. For example, cystic fibrosis (CF) is an inherited disorder
    which afflicts millions of children world-wide. The genetic defect in
    CF has been identified and involves a pump which, in effect, moves salt
    and water into and out of cells. Children with CF insufficiently pump
    water into the secretions of their pancreas and lungs and the dryness
    of these secretions leads to obstruction of those organs and subsequent
    infection and/or obstruction.
        The CHI will address genetic disorders that lead to a much broader
    array of disorders such as heart defects, autism, diabetes, muscular
    dystrophy to name a few. The Institute will grow on a current funding
    base at RWJMS of approximately $50 million, $17 million of which has
    development as a theme. The CHI builds on existing significant
    strengths within RWJMS and our associated joint research institutes
    with Rutgers University.
        The CHI will act as a magnet for additional growth in research and
    health care program development in New Jersey. The Institute will
    encompass 83,000 gross square feet and will house more than 40 research
    laboratories and associated support facilities. Fourteen senior faculty
    will direct teams of M.D. and Ph.D. researchers, visiting scientists,
    postdoctoral fellows, graduate students and technicians for a full
    complement of some 130 employees. At maturity, the Institute is
    expected to attract $7 to $9 million dollars of new research funding
    annually. The Institute's total annual operating budget is projected to
    be $10 to $12 million: applying a standard economic multiplier of 5,
    the total impact on the New Brunswick area is estimated to be $50 to
    $60 million per year. Construction costs for the Institute are
    estimated at $27 million, with approximately half of that figure
    associated with local employment.
        We respectfully seek $10 million from the Department of Energy and
    Water to further advance the construction and development of the Child
    Health Institute of New Jersey.
        Our second priority is the Neurological Institute of New Jersey at
    UMDNJ-New Jersey Medical School (NJMS) and UMDNJ-University Hospital
    (UH) in Newark, New Jersey. The Institute was created as a center of
    excellence in the neurosciences in recognition of the fact that
    neurological diseases are a leading cause of death and disability and,
    of the widespread expertise that exists in this discipline on our
    Newark campus.
        University Hospital is the major provider of tertiary neurological
    and neurosurgical services to the State of New Jersey, including
    patient care, education and research. The NJMS-Department of
    Neurosciences is ranked sixth nationally in research funding, with $4.1
    million annually. NJMS offers the only fully accredited neurosurgical
    residency program in the state. The Neurological Institute will serve
    as an umbrella under which clinical, research and educational efforts
    in the neurosciences would be focused to support a higher level of
    achievement and expertise than currently exists in New Jersey.
        The Neurological Institute will enable UMDNJ to further advance its
    cutting-edge work in neurological disorders including stroke, multiple
    sclerosis and Alzheimer's disease. About 50 million Americans are
    affected by these diseases annually. Neurological diseases account for
    some $400 billion annually in health care costs and lost productivity.
    While neurological diseases and injuries are devastating, there are
    breakthroughs in treatment with new drugs and/or surgical techniques,
    which require research and testing, significant financial support and a
    concentration of clinical expertise and potential research subjects in
    a controlled environment. The Neurological Institute will provide such
    a setting and will place New Jersey in the forefront of research and
    treatment of neurological diseases.
        The employment of new MRI-technology can aid in the diagnosis and
    treatment of neurological diseases. We are working on the newest
    treatments available, and an investment in the work of the Neurological
    Institute is critical to advance our work in these diseases.
        UMDNJ seeks a major step forward in the research arena with the
    acquisition and placement of a state-of-the-art Magnetic Resonance
    Imaging (MRI) instrument for the Neurological Institute. This MRI, with
    a rated field strength of 3-4 Tesla, is expected to provide spatial
    resolution in the millimeter range and temporal resolution of less than
    one second--both carrying great significance at physiological levels.
    Areas of research will include language, learning, memory, visual
    processing and spatial representation. Clinical applications will
    include Alzheimer's disease, multiple sclerosis, tumor characterization
    and epilepsy where brain dysfunction is clearly established. UMDNJ
    would collaborate with its research partners, the Veterans
    Administration Medical Center, Rutgers University and the New Jersey
    Institute of Technology in the development of a neuroimaging
    laboratory.
        We respectfully seek $1.5 million from the Department of Energy and
    Water toward the capital and instrumentation costs of a neuroimaging
    laboratory for the Neurological Institute of New Jersey.
        Our next priority project is our initiatives aimed at responding to
    threats of emerging infectious diseases, and chemical and biological
    terrorism.
        UMDNJ is home to the International Center for Public Health, a
    strategic initiative that will create a world-class infectious disease
    research and treatment complex at University Heights Science Park in
    Newark, New Jersey. We are also home to the New Jersey Medical School
    National Tuberculosis Center, one of only three model Tuberculosis
    Prevention and Control Centers in the United States funded by the
    Centers of Disease Control (CDC).
        In our complex world of instant communication and ease of global
    transportation, disaffected individuals or political groups have access
    to highly destructive weapons of terror. With our open society the
    United States is particularly at risk to individuals, ideologically
    motivated fanatics, or to nations seeking revenge. The possibility of
    the employment of weapons of mass destruction on an innocent population
    has already become a reality with the Sarin nerve gas attack in the
    subways of Tokyo.
        State and local governments and health organizations need reliable
    information upon which to develop and coordinate response plans for
    contingencies due to weapons of mass destruction. They need programs to
    educate planners and response teams on the public health aspects of
    these threats and how to recognize and respond to them. In addition,
    they need to understand both the short and long term implications for
    human and ecologic health. Such a plan requires a broad base of
    scientific and educational expertise which has an international scope
    in order to devise approaches for the early detection and treatment of
    biological and chemical weapons of terror. As citizens of the nation's
    most densely populated state, we in New Jersey have a particular
    concern about being targets of biological and chemical terrorist
    activities. Our communities abut each other and our traffic patterns
    are statewide making us especially vulnerable to infectious disease.
    There are no obvious geographical boundaries to readily institute a
    quarantine. Our central location as a transportation hub for the
    populous Northeast also makes us a prime target.
        Terrorists have three types of weapons available to them. For the
    first, explosive devices, although increasingly deadly, we have
    developed responses and have become all too familiar with this form of
    terror and chaos. The other two types of terrorist weapons are
    relatively new and present particular challenges to our normal response
    processes. These are chemical weapons of terror, such as nerve gas, and
    biological weapons of terror, such as anthrax. Chemical and biological
    weapons differ dramatically from explosions in that for these newer
    threats early recognition and diagnosis is crucial for both those
    initially affected and for others who might yet be affected through
    spread of infection or contact with the chemical. Education of
    emergency responders to correctly identify these threats, whether they
    occur here or abroad, is crucial to minimize the impact of biological
    and chemical weapons, as well as to protecting the emergency responders
    themselves. Compounding our problems is the need for a better
    understanding of the effects of likely chemical and biological agents
    of terrorism, development of the means to prevent their spread, and to
    rapidly treat their victims.
        The nation's foremost program in education and training concerning
    chemical and physical threats is headed by a UMDNJ faculty member who
    is currently President of the American Public Health Association. Among
    her programs is the Center for Education and Training which provides
    training concerning chemical and physical agents to more than 160,000
    police, firefighters, municipal and state employees, as well as to
    physicians, nurses and industrial hygienists. Because of its scientific
    expertise, UMDNJ is uniquely qualified to develop a program to educate
    state and municipal governments, emergency responders and health and
    hospital professionals on planning for the response to terrorism and
    training personnel to deal with threats of terrorism and how they
    affect public health.
        We respectfully seek $1.5 million through the Department of Energy
    and Water to expand our research, education and training programs in
    response to threats of chemical and biological terrorism.
        Our final priority is to seek continued funding for the Consortium
    for Risk Evaluation with Stakeholder Participation (CRESP), which is in
    its fourth year of funding from the DOE's Office of Environmental
    Management (EM). CRESP has become an integral part of the technical
    dialogue between DOE EM sites and their regulators on major issues. At
    both the Savannah River and Hanford, regulators are taking our results
    and using them to facilitate better remedial options to expedite or
    validate decisions that bring cleanup to closure.
        By focusing its scientific efforts on issues which are arising at
    various points of regulatory interface, and providing data accepted by
    all parties as sound and credible, CRESP believes its work is not only
    proving valuable on specific issues, but is providing a basis for more
    extensive, complex wide replication and application. The pace of
    requests that CRESP scientists are involved in has expanded
    dramatically. We believe that we are more than a source of new
    information and methods. A mechanism such as CRESP is fundamental to
    bringing resolution to the regulatory process that would otherwise not
    be resolved.
        The Administration's budget calls for CRESP to receive $3 million
    for fiscal year 2000. However, to maintain our current level of
    activity, we respectfully request an investment of $4 million. If CRESP
    is going to expand to respond to new requests, it will require at least
    that amount.
        Thank you for the opportunity to submit testimony on behalf of the
    University of Medicine and Dentistry of New Jersey (UMDNJ). We are
    grateful to this committee for its past support of our initiatives and
    for your leadership in advancing biomedical and environmental research.
                                     ______

      Prepared Statement of Joe F. Colvin, President and Chief Executive
                       Officer, Nuclear Energy Institute
        On behalf of the Nuclear Energy Institute, I would like to commend
    you, Chairman Domenici, Ranking Member Reid and the members of this
    subcommittee for focusing your attention on the value of nuclear-
    related programs contained in the Energy Department and Nuclear
    Regulatory Commission budget proposals for fiscal year 2000.
        Before I proceed, let me say a word about the Nuclear Energy
    Institute. NEI sets policy for the U.S. nuclear energy industry and
    represents over 275 members with a broad spectrum of interests,
    including every U.S. utility that operates a nuclear power plant. NEI's
    members also include nuclear fuel cycle companies, suppliers,
    engineering firms, research laboratories, radiopharmaceutical
    companies, universities, labor unions and law firms.
        In large measure, your continued support of nuclear-related
    programs will ensure a strong legacy of nuclear energy, science and
    security for our children and for generations to come. The programs
    outlined in my testimony will further U.S. advances in nuclear medicine
    and technology; help guard against international threats to our energy
    security and nuclear safety; and encourage growth of the nation's
    largest source of emission-free electricity.
        Today, nuclear energy generates 20 percent of the nation's
    electricity--enough for 65 million homes. More than 100 nuclear units
    contribute to the stability of the nation's power grid and are the
    greatest source of emission-free energy in the country. Policymakers
    who recognize the nexus between energy and environmental policy cannot
    ignore nuclear energy's unique value in mitigating emissions to meet
    U.S. clear air regulations and international carbon abatement goals. To
    capitalize on these benefits, comprehensive reform of the nuclear
    regulatory process must be a priority in fiscal year 2000
    appropriations legislation.
                         nuclear regulatory commission
        Safety is the nuclear energy industry's top priority, and we
    recognize the unique responsibility that the Nuclear Regulatory
    Commission has to assure adequate protection of public health and
    safety. The NRC's $465.4 million funding request should be devoted to
    implementing regulations that have a direct bearing on safety. One of
    the single most important challenges facing the nuclear energy industry
    is a regulatory process that consumes licensee and NRC resources on
    issues that have little or no safety significance, and that produce
    inconsistency in assessment and enforcement.
        Mr. Chairman, I cannot overstate the importance of this
    subcommittee's role, which has been instrumental in encouraging the NRC
    commissioners and staff to complete work on many long-standing reform
    issues. The NRC has a number of promising regulatory reform initiatives
    underway. However, Congress should continue to guide regulatory reform.
        The Omnibus Budget and Reconciliation Act of 1990, as amended,
    requires that the agency recover approximately 100 percent of its
    budget authority by assessing licensees annual fees consistent with the
    regulatory benefits derived. Most of those fees are collected as a
    generic assessment levied on NRC licensees, creating, in effect, a
    ``miscellaneous'' category to encompass nearly 80 percent of its
    budget. This practice is contrary to sound and accountable budgeting.
    The industry supports legislation to modify the fee structure so that
    licensees are assessed only for NRC programs necessary to regulate
    them. Unrelated agency expenditures, such as international activities
    and regulatory support to agreement states or other federal agencies,
    should not be included in nuclear plant licensee user fees, but should
    be included in a specific line item on the NRC's budget, subject to the
    authorization and appropriations process. Additionally, the agency's
    ability to collect user fees should be authorized annually by Congress
    until the commission completes its regulatory reform initiatives.
        We strongly urge the subcommittee to reaffirm its recommendation
    last year to eliminate agency expenditures in fiscal year 2000 that do
    not benefit licensees so that user fees are fairly and equitably
    assessed.
        In the area of reform, the subcommittee should encourage the NRC to
    develop and implement a long-term strategic plan as well as to focus on
    activities that can be completed in the near term. The NRC's long-range
    strategy should include these principles: A safety-focused regulatory
    framework that incorporates risk insights; a more efficient and
    accountable regulator; an integrated NRC strategy for achieving the
    objectives of regulatory reform; and a specific timetable and
    milestones to ensure the NRC's long-range plan is implemented on
    schedule; and staff resources and a fully accountable budget that
    supports fundamental NRC reform.
        The nuclear energy industry believes that rather than increase the
    NRC budget--and user fees--the commission can better focus its programs
    and regulations on safety-based performance standards. Such an emphasis
    on performance standards would free NRC resources for license renewal
    of nuclear power plants and other discrete licensing actions without
    increasing the agency's overall budget.
        The nuclear energy industry fully supports approval of the funding
    requested by NRC from the Nuclear Waste Fund. These funds will allow
    the NRC to continue its oversight of the Yucca Mountain project as the
    Department of Energy prepares its license application for the
    repository. The NRC's oversight activities are a crucial step toward
    timely implementation of the integrated used fuel management program.
        On another front, this subcommittee can help resolve the long-
    standing impasse regarding overlapping regulatory authority between the
    NRC and the Environmental Protection Agency. This overlap authority
    exists in many areas, but is most immediately apparent in establishing
    radiation standards for a national repository for used nuclear fuel. As
    the subcommittee with jurisdiction over the Energy Department, the
    industry respectfully urges you to clarify the matter of setting
    radiation standards for Yucca Mountain. The NRC's regulations have
    proven effective in protecting public health and safety as well as
    worker safety at nuclear facilities. Conversely, EPA has little direct
    experience in regulating the use of radioactive materials and relies on
    a regulatory philosophy that lacks a scientific underpinning. The
    industry encourages this subcommittee to take actions necessary to
    eliminate dual regulation of nuclear facilities. For the reasons
    stated, EPA's standard setting authority should be ceded to the NRC, an
    independent agency with scientific and technical expertise.
                    nuclear energy research and development
        Mr. Chairman, continued investment in nuclear energy research and
    development will ensure the U.S. position as a world leader in nuclear
    safety and technology. Through its fiscal year 2000 recommendations,
    this subcommittee also can continue to capitalize on nuclear energy's
    ability to avoid atmospheric emissions amid stronger Clean Air Act
    controls and international air quality goals. In fact, DOE states that
    without nuclear generation, the resulting increase in carbon emissions
    would be five times greater than utility reduction goals for 2000 under
    the agency's Climate Challenge Program.
        A comparison of electricity generating sources reveals that nuclear
    energy is the most economical federal research and development
    investment. For example, in 1997, the federal government spent 5 cents
    for every kilowatt hour generated at nuclear power plants. The cost per
    kilowatt-hour of research and development in wind energy for that
    period was $4,769; for photovoltaics, $17,006; for natural gas, 41
    cents and for coal, 5 cents.
        The nuclear energy industry encourages the subcommittee to support
    a $40 million appropriation for the Nuclear Energy Research Initiative,
    which funds research and development at universities, national
    laboratories and industry to advance nuclear power technology, pave the
    way for the expanded use of emission-free nuclear energy and maintain
    U.S. leadership in nuclear technology and safety abroad. During its
    first year, NERI's review board received an impressive 300 grant
    applications. In light of this enthusiastic commitment, the proposed
    $40 million would permit NERI to grow yet remain manageable. The Energy
    Department's $25 million request would support continuation of first-
    year projects, but permit little, if any, expansion.
        In addition to NERI, DOE's request for the Nuclear Energy Plant
    Optimization program would allocate $5 million to research and
    development projects that enhance the efficiency and reliability of our
    103 nuclear power plants. The industry strongly supports a $10 million
    program in keeping with recommendations of the President's Committee of
    Advisors on Science and Technology. This initiative is particularly
    important as utilities deal with uncertainties associated with electric
    industry restructuring. NEPO seeks to work with industry to improve
    plant economics, reliability, availability and plant aging while
    maintaining a high level of safety.
        Finally, the industry recommends $17 million for University
    Supportprograms at universities and colleges to enhance research and
    education in nuclear sciences by helping to sustain university reactor
    and engineering programs. While DOE requested $11.3 million, the
    nuclear energy industry believes additional funds are needed to expand
    the Nuclear Energy Education Research initiative and recruitment of
    future nuclear engineers and scientists.
        In addition to these efforts, the industry strongly encourages the
    subcommittee to restore $20 million for electrometallurgical research
    at Argonne National Laboratories. This research would focus on devising
    technology to treat used fuel that powered the Argonne reactor, EBR-II.
    Research on the treatment of this metal fuel's unique composition could
    be applied to the treatment and disposal of other reactor fuels with
    unique characteristics.
               federal storage and disposal of used nuclear fuel
        A key component that ensures the continued benefits of nuclear
    energy is the federal acceptance and disposal of used nuclear fuel.
    Since 1982, the Energy Department has been siting and developing a deep
    geologic repository for the disposal of used nuclear fuel. In recent
    years, however, the agency has failed to advance an important aspect of
    the program--the acceptance and removal of used fuel. A little more
    than a year ago, the Energy Department was scheduled to start accepting
    used fuel from national laboratories, nuclear power plants and defense
    facilities at more than 100 locations in 40 states. The agency missed
    its deadline in violation of its clear statutory duty under the Nuclear
    Waste Policy Act of 1982. The law requires disposal at a single,
    federally monitored location.
        The Energy Department in December 1998 released a report ordered by
    Congress supporting the continued scientific study of Yucca Mountain,
    Nevada, as the site for a permanent repository for used nuclear fuel.
        The report concluded that ``DOE believes that Yucca Mountain
    remains a promising site for a geologic repository.'' Despite the sound
    scientific basis for the viability assessment, the Administration still
    refuses to move used nuclear fuel. A recent plan from Energy Secretary
    Bill Richardson to take title of used nuclear fuel would leave used
    fuel where it is today and would pay for the program through the
    Nuclear Waste Fund. Although this proposal does not work as a stand-
    alone concept, the industry recognizes the valuable opportunity that
    Secretary Richardson has posed to industry stakeholders through the
    promise of continued dialogue focused on immediate receipt of used
    nuclear fuel. The industry welcomes that opportunity.
        However, this country needs an immediate solution to central
    storage and disposal of its used nuclear fuel. The industry urges the
    subcommittee to support the Nuclear Waste Policy Act of 1999, S. 608,
    which would ensure funding for central storage and a geologic
    repository by altering the funding mechanism of the program. Without
    the budget modification in S. 608, DOE would fall short of funding
    needs now that it appears that a more realistic date for the agency to
    open a repository may be 2020, not 2010.
        Despite the Energy Department's default, scientific and technical
    activities must continue if the agency is to able to determine if the
    permanent repository site is suitable. The agency's $409 million fiscal
    year 2000 request for the Office of Civilian Radioactive Waste
    Management is necessary to ensure the office continues to meet
    deadlines for data collection and study at the proposed Yucca Mountain,
    Nev., repository. All of these projects further DOE's effort to prepare
    a draft environmental impact statement and license application for the
    repository. From the industry's perspective, the fiscal year 2000
    request assures timely scientific study and analysis at Yucca Mountain.
        The administration's budget for Yucca Mountain activities includes
    $39 million from funds previously appropriated in 1996 for interim
    storage. Congress set those funds aside for an interim storage facility
    and an associated transportation framework pending passage of an
    authorization bill. This subcommittee should prevent the diversion of
    previously appropriated funds so that the money can be held for its
    intended purpose. However, as stated above, the agency's $409 million
    request is necessary to ensure the agency continues to meet its
    deadlines.
        The nuclear energy industry believes that Nevada's use of federal
    grants by the state university system and counties has been wise and
    has resulted in useful contributions to the repository project. These
    efforts should continue to be funded. However, the nuclear energy
    industry continues to support strong oversight of all expenditure for
    the federal used nuclear fuel management program. Through this
    subcommittee's vigilance, recent appropriations acts have precluded
    Nevada from using grant funds for lobbying, litigation and certain
    multistate activities . Until the subcommittee is satisfied that DOE-
    administered funds provided to the state are properly spent, any
    further funds should be withheld from grant recipients shown to have
    misspent past federal grant money.
        Several other programs warrant industry support at the recommended
    funding:
        Low-Dose Radiation Research.--The nuclear energy industry supports
    the Energy Department's request of $10 million to study how cells react
    to low radiation doses and to better understand biological responses to
    radiation that would further enhance occupational radiation protection.
    This research has garnered the support of the Health Physics Society,
    as the attached Health Physics Society policy statement notes.
        Uranium Decontamination and Decommissioning.--The industry believes
    the federal government has a responsibility for site cleanup and
    decommissioning. DOE's fiscal year 2000 request for appropriations from
    the fund includes $242 million for activities at the government-owned
    gaseous diffusion plants and $35 million for uranium/thorium tailings
    cleanup.
        Surplus Weapons Material Disposition.--The nuclear energy industry
    supports the Energy Department's $200 million request for the disposal
    of surplus weapons fissile materials so that the United States and
    Russia can continue a parallel path to dispose of excess weapons-grade
    material. The nuclear energy industry and federal agencies also must
    continue efforts to use mixed oxide fuel at U.S. reactors.
        International Nuclear Safety Program and Nuclear Energy Agency.--
    DOE's International Nuclear Safety Program is essential to improving
    operational safety at Soviet-designed nuclear power plants. Potential
    weaknesses in reactor safety abroad may pose threats to public health
    and the environment and erode public confidence in the entire industry.
    The Institute also supports continued funding for U.S. membership in
    OECD's Nuclear Energy Agency. The industry also supports expansion of
    DOE's nuclear nonproliferation program, including the nuclear cities
    initiative with Russia.
        Medical Isotopes.--The industry supports DOE' radioisotope program
    and encourages the enhanced and continued supply of isotopes for the
    purpose of medical research. Such isotopes are not readily available in
    the commercial sector and the Energy Department has a historical
    mandate from the Atomic Energy Act of 1954 to provide medical isotopes.
        DOE Radiation Standards.--An area of major concern to the industry
    is overlapping authority on development of radiation standards for safe
    cleanup and restoration of DOE's decommissioned facilities. We urge the
    subcommittee to support the Energy Department in finalizing standards
    in order to enhance a safe, economic and timely conclusion to the
    agency's extensive environmental restoration program. Close involvement
    between DOE and the NRC ensures early identification of potential
    concerns that otherwise would require more costly long-term review.
                                   conclusion
        By funding the Energy Department's nuclear energy research and
    development initiatives, the subcommittee would reaffirm nuclear
    energy's valuable contribution toward achieving clean air compliance
    and continue research to further enhance productivity of U.S. nuclear
    power plants. As the nation's second largest electricity source,
    nuclear energy is well-positioned to meet future energy demand in a
    manner that preserves and improves our air quality.
        The nuclear energy industry urges the subcommittee to consider the
    equity of the Nuclear Regulatory Commission's user fee. Licensees
    should not be assessed 100 percent user fees for commission activities
    that do not affect the regulation of licensees, but that have broader,
    national or international application.
        Finally, although the Department of Energy has failed to meet
    statutory and court-affirmed deadlines for disposal of used nuclear
    fuel, Congress should support the agency's continued scientific and
    technical work at the proposed Yucca Mountain repository to avoid
    further delays. Even as Congress considers separate legislation to
    reform the federal nuclear waste management program, the subcommittee
    must ensure that activities progress to support the repository project.
    I would like to thank the subcommittee for the opportunity to share the
    industry's perspective on issues vital to the nuclear energy industry.
                                     ______

       Prepared Statement of the Business Council For Sustainable Energy
                                  introduction
        The Council is pleased to offer testimony to the Energy and Water
    Subcommittee of the Senate Appropriations Committee on the proper role
    for government in promoting energy research and development, as it
    relates to renewable energy programs at the Department of Energy (DOE).
        The Council was formed in 1992 and is comprised of businesses and
    industry trade associations which share a commitment to realize our
    nation's economic, environmental and national security goals through
    the rapid deployment of clean and efficient natural gas, energy
    efficiency, and renewable energy technologies. Our members range in
    size from Fortune 500 enterprises to small entrepreneurial companies,
    to national trade associations.
        Few activities have a greater impact on our nation's economy,
    environment, and national security than the production and use of
    energy. Our economic well-being depends on energy expenditures, which
    account for approximately 7 to 8 percent of the nation's gross domestic
    product and a similar fraction of U.S. and world trade. Energy
    production and use also account for a large share of environmental
    problems, such as regional smog, acid rain, and the accumulation of
    greenhouse gases in the atmosphere. Our national security is
    increasingly linked to energy production and use, given our nation's
    increasing dependence on foreign oil sources, including those from the
    politically unstable Middle East. Expanded reliance on natural gas,
    energy efficiency, and renewable energy are the three pillars of a more
    secure and sustainable energy strategy that will help strengthen the
    U.S. economy and clean up the environment.
             federal programs to promote renewable energy resources
        The Council recognizes that it is the suppliers and users of
    energy--not the federal government--that ultimately will decide which
    energy sources will meet our future energy needs. However, the federal
    government does play an important role in helping the private sector
    share the risk of investing in deployment of clean technologies that,
    while at or near economical viability, face financial, informational,
    or institutional obstacles to their wide market availability. The
    Council would like to describe the following programs, which can
    strengthen the nation's portfolio of energy generation technologies.
                                      wind
        World markets for utility-scale wind energy are growing at an
    unprecedented rate. Figures for 1998 indicate that total worldwide
    installed wind capacity stands at 9,600 megawatts (MW), up 19 percent
    from a year earlier. This figure includes approximately 2,000 MW
    installed in 1998. The Council supports DOE's total request of $45.6
    million for wind energy research and development in fiscal year 2000 to
    fund projects in turbine research ($20.2 million), cooperative research
    ($11.9 million) and applied research ($13.5 million). This level of
    funding is particularly important to continue developing next
    generation wind turbine technologies needed to keep the U.S. industry
    competitive in restructured domestic markets and in the fast growing,
    highly competitive international markets.
        Total U.S. wind capacity grew by 235 MW in 1998, a significant
    change from the previous three years when U.S. markets for wind energy
    had slowed to 11 MW in 1997, 10 MW in 1996, and 41 MW in 1995.
    Preliminary projections indicate that 600 MW of new wind generating
    capacity will be developed in 1999 and that 120 to 250 MW of wind
    capacity will be added through ``repowering'' development at several
    older wind farms in California. Repowering involves the replacement of
    older wind turbines with newer, more efficient models. While the long-
    term future of wind technologies is uncertain in an increasingly
    deregulated electricity market, cost-shared DOE/wind industry efforts
    have the potential to develop the next generation of wind technologies
    to deliver electricity in the range of 2.5 cents/kilowatt-hour.
        The Council supports DOE's programs focusing on small wind turbines
    which generate up to 50 kilowatts, including the cost-shared Advanced
    Small Wind turbine project. Small wind turbines are used for smaller
    on-and off-grid applications where the value of the energy is high.
    Presently, U.S. small wind turbine manufacturers are the world's
    leading suppliers but they must rely on exports for approximately
    three-quarters of their business. The small size of the domestic market
    makes this industry vulnerable to foreign competition, particularly
    from countries with more developed markets. For this reason, the
    Council is encouraging DOE to expand its small wind turbine market
    development programs by creating initiatives similar to PV-COMPACT, PV-
    BONUS, and the Million Solar Roofs program. Such initiatives would
    lower the costs of small wind turbines, create many new jobs, and give
    more opportunities for the marketplace to choose the most competitive
    small-scale renewable energy technologies.
        DOE has also been effective in helping U.S. small wind turbine
    companies overcome barriers to important international markets. While
    DOE expenditures in this area have been very modest, support by the
    National Renewable Energy Laboratory in the areas of wind resource
    studies, economic analyses, and pilot projects has created substantial
    new markets in South America, Asia, and Russia. Throughout the world,
    rural villages are being electrified or provided with clean water by
    small wind turbines exported from the U.S., at costs that are lower
    than the conventional alternatives of extending the grid or running
    diesel generators.
        Funding for Cooperative Research and Testing will provide support
    for industry testing at the National Wind Technology Center (NWTC) in
    Rocky Flats, Colorado. This will allow for continued development of a
    U.S.-based certification capability for wind energy technologies.
    Ultimately, streamlined certification criteria will make it easier for
    U.S. businesses to market and sell American-made wind turbine
    technologies in international markets.
        The main focus of the applied research program is development of
    models to better understand aerodynamics (through wind tunnel tests),
    fatigue damage prediction and structural reliability capabilities.
    Modeling and code design work is underway at both the National
    Renewable Energy Laboratory (located in Golden, Colorado) and the
    Sandia National Laboratory (New Mexico).
        More and more electric utilities are becoming interested in
    generating power from large-scale wind power plants. The global market
    for wind power is expected to further grow over the next few years. New
    wind power markets are driven in part by the fact that at least one-
    third of the world's population--over 2 billion people--do not have
    access to reliable energy. Maintaining an U.S. presence in this growing
    industry is a valuable investment of federal resources--one that will
    pay off many times in the next several decades.
        The global wind energy market has been growing at a remarkable rate
    over the last several years and is the world's fastest growing energy
    technology. The growth of the market offers significant export
    opportunities for U.S. wind turbine and component manufacturers. The
    World Energy Council has estimated that new wind capacity worldwide
    will amount to $150 billion to $400 billion worth of new business over
    the next twenty years. Experts estimate that U.S. companies can sell
    over $1 billion of wind energy each year if U.S. industry can capture
    25 percent of the worldwide wind energy market over the next five
    years.
                                  solar energy
        The United States currently leads the world in the diverse
    portfolio of solar technologies: photovoltaics (PV) for manufacturing;
    thin films and energy services; solar thermal power in advanced
    concentrations (solar power towers, parabolic troughs, and dish-
    engines); and solar buildings in integrated systems and energy services
    delivery. However, our international competitors are positioning
    themselves to take market share from the United States in vast,
    multibillion dollar world markets, as a result of strong support
    provided by their respective governments--especially in Japan and
    Germany--through a variety of aggressive development and deployment
    programs. Maintaining our lead will require strong and focused U.S.
    government action, not only to support international activities but
    also to secure a position in growing domestic markets.
        Solar technologies available today include PV, solar water and pool
    heating, solar process heating, and solar thermal power technologies.
    Faster integration of solar energy systems in both supply-and demand-
    side applications in our domestic economy, combined with support for
    increased exports of U.S. solar technologies, will have the parallel
    benefits of creating thousands of new high-technology manufacturing
    jobs while improving our environment. The Council supports the trend
    toward market-driven, industry cost-shared programs designed to
    leverage federal dollars with private sector participation to enhance
    private sector understanding and use of these technologies.
        Improving conversion efficiency of solar panels and reducing
    manufacturing costs will play a key role in sustaining U.S. dominance
    in the area of PV. The Council supports DOE's photovoltaic system
    program. PV programs are among the best leveraged (the PV COMPACT
    program, for example, leverages $4 and $5 for every federal dollar
    expended) in DOE. Our two most formidable competitors, Japan and
    Germany, are outspending DOE's investment in PV research and
    development and PV commercialization programs. While U.S. industry is
    exporting a significant amount of its products to these countries, most
    expect this surge in demand to rapidly diminish as in-country
    manufacturing capabilities are increased. As an example, the Japanese
    Ministry of International Trade and Industry has set a domestic
    deployment goal of 400 megawatts of PV by next year and its
    manufacturers have responded to the challenge.
        Japanese manufacturers are expected to expand their annual
    production capacity four-fold to 80 megawatts over the next three
    years. Not only will this expansion allow the Japanese industry to meet
    much of its domestic demand for PV; it will enable Japan to overtake
    the U.S. in terms of global market share. The Council also supports the
    Administration's Million Solar Roofs (MSR) Initiative.
        The Council supports DOE cost-shared initiatives in R&D (thin-films
    and other advanced materials, manufacturing and other solar initiatives
    which address these issues). Equally important is the concept of
    building integrated PV programs where PV manufacturers, systems
    integrators and utilities are working together to reduce the cost of PV
    generated electricity. The Council also supports the Department's PV
    COMPACT program. PV COMPACT is a collaborative effort involving more
    than 80 electric utilities (representing over half the electricity
    produced in the U.S.) and other interested organizations to garner the
    economic, commercial, and environmental benefits of PV technologies.
        PV and other solar technologies offer the U.S. environmentally
    benign and cost-effective energy supply options in a variety of market
    applications. The market viability of these technologies is
    demonstrated in growing private sector interest in developing new
    manufacturing facilities related to solar industries. In the area of PV
    production alone, the last four years have witnessed six U.S. companies
    announce plans to construct new photovoltaic plants. This activity is a
    unique example of DOE funding encouraging significant private-sector
    investment that creates new jobs. The Council strongly urges Congress
    to continue its support of public/private partnerships that help ensure
    that U.S. companies can compete effectively in rapidly emerging world
    renewable energy markets.
        BCSE is highly supportive of non-conventional PV programs within
    DOE's Office of Power Technologies. The Council specifically supports
    the non-conventional PV request of $4.3 million and specifically
    requests the Committee to instruct DOE to dedicate $2 million for
    Thermo Photovoltaic (TPV) research.
        The Council also supports PV programs within DOE's Office of Energy
    Efficiency and Renewable Energy, specifically DOE's Solar Thermal
    Buildings program, a research and development program focusing on
    materials and components for solar water and space heating technologies
    for building applications. Based at the National Renewable Energy
    Laboratory and the Florida Solar Energy Center, the program also has a
    strong technology standard and certification component. Activities in
    fiscal year 2000 should include the completion of collaborative
    projects with utilities and builders to assess their impact on
    improving solar water heating technology and the completion of a
    cooperative research and development agreement with the Salt River
    Agricultural Improvement and Power District to develop a solar water
    heater that could provide hot water at a cost of 6 to 7 cents per
    kilowatt-hour.
        The Council supports the Solar Thermal Electric and Process Heat
    programs, an R&D program on materials and components with a heavily
    cost-shared technology validation component. Over the past six years,
    the primary program focus has been in collaboration with industry to
    develop advanced solar thermal electric technologies to the point of
    commercial readiness.
                             distributed generation
        Utilities throughout the nation are reorganizing to meet the many
    challenges associated with electric utility restructuring. Accordingly,
    power providers are developing state of the art technologies aimed at
    providing customers with the cleanest, most reliable, and cheapest
    power possible. Combined heat and power (CHP) and distributed
    generation technologies provide reliable on-site power generation with
    dramatically improved efficiencies and cleaner fuels such as natural
    gas and biomass gas. BCSE strongly supports $8 million for development
    and deployment of CHP and related distributed generation systems,
    managed by the Office of Industrial Technologies, which showcase novel
    integrated schemes or hybrid system demonstrations.
                     renewable energy production incentive
        As part of the Energy Policy Act of 1992 (Sec. 1212), Congress
    passed the Renewable Energy Production Incentive (REPI) to encourage
    the development of renewable energy projects in tax-exempt municipal
    utilities. This program has been succcessful in helping municipal
    utilities such as the Sacramento Municipal Utility District develops
    wind and solar generating facilities. We believe the Administration's
    request is insufficient to meet the requirements of this program, and
    request the Committee increase to $20 million the funding for the REPI.
                            international activities
        Finally, the Council would like to offer its support of federal
    programs designed to help open important international markets for
    renewable energy technologies. The Council is extremely supportive of
    the fiscal year 2000 increases in funding for international energy
    programs such as the International Solar Energy Program.
        The developing world--Eastern and Central Europe, the former Soviet
    Union, Asia, Africa, and Latin America--presents tremendous
    opportunities for the deployment of renewable energy technologies.
    Renewables offer great flexibility to developing countries looking for
    economically viable, reliable, and clean energy supply options that can
    be used to serve growing metropolitan areas and remote rural regions
    where power is otherwise unavailable. Renewables can also help support
    the development of commercial activities such as agriculture and
    telecommunications through remote power source applications.
    Competition in rapidly growing developing country markets is intense;
    U.S. renewables manufacturers face the dual obstacles of competition
    from conventional energy sources and foreign renewables manufacturers
    buoyed by government assistance.
        In this regard, it is important to note that major U.S. competitors
    are now making aggressive moves into the renewables market. When
    measured against the relative size of their economies, Japan, Germany,
    and Sweden are each now making larger government R&D investments in
    renewables than is the U.S. In fact, the U.S. taxpayer spends a lower
    portion of his R&D budget on energy than any other taxpayer in an
    industrialized, market-based economy.
        U.S. government assistance in identifying market opportunities,
    providing education and training for energy decision-makers in the
    developing world, and supporting demonstrations of renewable
    technologies in overseas applications promises to help ensure that U.S.
    renewables manufacturers will be successful in capturing market share
    throughout the expanding global market for clean energy technologies
    and services.
                                   conclusion
        Some have suggested that a technology should have a minimum market
    share before federal support is provided for R&D. We believe that the
    role of the federal government should in fact decrease as new
    technologies successfully penetrate the market and increase their
    ability to support robust R&D programs on their own. Promoting
    research, development and validation of emerging renewable energy
    technologies will result in the near-term creation of thousands of new
    jobs, a stronger economy, enhanced export opportunities for domestic
    manufacturers, and a cleaner environment. DOE's budget request
    continues federal emphasis on developing low-and non-polluting energy
    technologies and services as a means of achieving these goals. It
    utilizes cost-shared collaboratives with industry to leverage limited
    federal funds in recognition that cooperation with industry is vital
    for addressing market imperfections impeding the widespread use of
    renewables. The Council strongly supports this approach, and urges
    Congress to continue its support of federal research, development and
    validation programs for renewable energy technologies.
                                     ______

              Prepared Statement of the American Chemical Society
        The American Chemical Society (ACS) strongly supports increasing
    the federal investment in research conducted by the Department of
    Energy's Office of Science (SC).
        As part of our commitment to sustained research funding, ACS
    supports doubling total federal spending on research within a decade,
    fiscal year 1999-fiscal year 2009. This requires an average increase of
    7 percent per year for each of the federal government's basic research
    programs. For that reason, ACS applauds Congress' recognition of the
    importance of energy-related research and for providing SC with an
    increase of greater than 9 percent in fiscal year 1999. This is an
    important first step.
        ACS urges Congress to further strengthen the national investment in
    research supported by the Department of Energy's Office of Science by
    providing it with at least a 7 percent increase in fiscal year 2000.
    The nearly 5 percent increase proposed in the fiscal year 2000
    Administration budget request for SC is insufficient to meet the
    energy-related research needs of our nation. Moreover, while the
    Society is pleased with the strong funding levels for proposed research
    initiatives such as the Scientific Simulation Initiative and the
    Climate Change Technology Initiative, ACS is concerned about the
    decrease in funding for ongoing basic research programs. For example,
    the Society is distressed with the proposed 2.3 percent decrease in
    funding for Chemical Science within the Basic Energy Sciences program.
        The ACS supports programs within SC for the following reasons:
      --The United States has a dynamic, comprehensive, interconnected
            research system that has enabled us to assume global
            leadership, enjoy a high standard of living, and ensure our
            nation's security. Maintaining those benefits requires
            continual renewal of investment in R&D, including research
            sponsored by SC, which is an integral part of the federal
            research enterprise.
      --SC-supported research is advancing our national goals of reducing
            energy consumption, harnessing new energy sources, and reducing
            our dependence on imported oil and improving the quality of the
            environment. Better understanding of combustion at a
            fundamental level, improved hazardous waste storage, and the
            development of new superconducting materials are some of the
            areas of discovery SC supports. SC research also plays a key
            role in efforts to understand global climate change.
      --SC programs include a broad array of research activities that
            advance the fundamental scientific knowledge base and train
            future scientists in areas of great importance to our nation.
            They are also the principal source of support for the non-
            defense R&D carried out at DOE's nine multipurpose national
            laboratories.
        The American Chemical Society appreciates Congress' continued focus
    on the nation's energy research needs, but also recognizes the
    difficulty in achieving the goal of doubling research support within a
    ten-year period. A national commitment to double federal support for
    research will require additional resources. ACS encourages Congress to
    work in a bipartisan manner with the Administration to identify and
    employ the necessary resources. The Society looks forward to working
    with Congress this year to strengthen the national investment in DOE
    basic research.
     chemistry: fundamental to meeting energy and environmental challenges
        Most chemistry research at DOE is supported through two programs
    within the Office of Science: Basic Energy Sciences (BES) and
    Biological and Environmental Research (BER). These two programs support
    the fundamental research that provides the discoveries, knowledge base,
    and the experienced scientists and engineers needed to address the
    environmental impacts of energy production and use. This research is
    also essential for control and clean-up of radioactive and hazardous
    wastes at DOE sites, particularly those sites involved in past nuclear
    weapons production.
      --Basic Energy Sciences is the most diverse research program within
            DOE. This program supports scientific research related to
            energy technology development, which consists of a wide range
            of basic research activities in chemistry, as well as
            materials, engineering, earth sciences, and energy biosciences.
            Basic Energy Sciences is also the program through which major
            research facilities are developed and maintained. The major
            user facilities operated by BES at the DOE laboratories are
            used extensively by industry, universities, and government on a
            cost-shared basis.
      --Biological and Environmental Research is focused on basic research
            in the biomedical and environmental sciences to further
            understanding of potential long-term health and environmental
            effects of energy productions and use that includes research on
            global climate change and the human genome project. The program
            also supports the Environmental Molecular Sciences Laboratory
            for bioremediation research.
        Investments in fundamental research have already paid off, as
    documented in past DOE reports. Examples of promising work include the
    following:
      --BES-supported researchers have synthesized and tested an ion
            exchange resin that removes a variety of metal contaminants
            from groundwater and mixed wastes.
      --Radioactive sludge intake wastes present clogging problems. Surface
            chemistry information being produced through SC-supported
            research is helping to control this situation.
      --In other SC-funded work, scientists have decomposed dioxins in soil
            using methods that are technically and economically feasible.
      --BES-supported research is combining models of turbulent combustion
            with realistic chemical kinetics to reduce the emission of
            pollutants from internal combustion engines.
        As the world's population grows, the energy and environmental
    challenges confronting us will become more complex and difficult for us
    to solve. The fundamental chemistry-related research supported by the
    Office of Science will be essential to our efforts to meet these
    challenges.
                                     ______

    Prepared Statement of Jaime Steve, Legislative Director, American Wind
                               Energy Association
                             wind power is working
        Cost-Shared R&D + Existing Tax Credit = New Jobs & Competitively
    Priced, Pollution-Free Power
        Over 230 Megawatts of New Domestic Wind Power Came On-Line in 1998.
        Utility-Scale Wind Power Expands Throughout the U.S.
        The American Wind Energy Association \1\ appreciates this
    opportunity to provide testimony for the record on the Department of
    Energy's Fiscal 2000 wind energy program budget before the Senate
    Appropriations Subcommittee on Energy and Water Development.
    ---------------------------------------------------------------------------
        \1\ The American Wind Energy Association, or AWEA, was formed in
    1974. The organization represents virtually every facet of the wind
    industry, including turbine and component manufacturers, project
    developers, utilities, academicians, and interested individuals.
    ---------------------------------------------------------------------------
        Our testimony addresses the following issues:
        (1) The need for increased appropriations for cost-shared DOE/
    industry R&D partnerships aimed at further driving down the cost of
    wind power to a level approaching 2.5 cents per kilowatt-hour.
        (2) Wind power is working throughout much of the U.S.--Alaska,
    California, Colorado, Hawaii, Iowa, Kansas, Massachusetts, Michigan,
    Minnesota, Nebraska, New Mexico, New York, Oregon, Texas, Washington,
    Wisconsin, Vermont, and Wyoming. Cost-shared R&D--which has already
    slashed the cost of wind power by more than 80 percent since the early
    1980's--coupled with the existing wind energy production tax credit is
    currently producing competitively-priced, pollution-free electricity.
        (3) Renewable Energy Production Incentive (REPI). This program
    would be significantly underfunded by the Clinton Administration budget
    proposal. But even more importantly, AWEA suggests that Congress work
    with the Department of Energy (DOE) to develop long-range alternatives
    to unpredictable annual funding of this program. For this
    appropriations cycle, AWEA recommends funding of $8 million--$12
    million below the $20 million need identified by DOE in its fiscal year
    1999 appropriations testimony.
                        a growing domestic wind industry
        Utility-Scale Wind Development.--Total U.S. wind capacity grew by
    235 megawatts (MW) in 1998, with major new wind plants being built in
    states outside California, traditionally the nation's leading wind
    energy producer. The states of Minnesota, Oregon, Wyoming, and Iowa
    account for most of the new development.
        This impressive growth exhibits a significant change from the
    previous three years when U.S. markets for wind energy had slowed to
    only 11 MW of new capacity installed in 1997, 10 MW installed in 1996,
    and 41 MW installed in 1995.
        This surge in U.S. wind energy capacity is due to two main factors:
        (1) Cost-shared DOE/industry R&D partnerships which have reduced
    the cost of wind energy by more than 80 percent since the early 1980's.
        (2) The impending expiration (on June 30, 1999) of the Wind Energy
    Production Tax Credit (PTC)which provides an incentive to produce
    electricity with non-polluting wind resources. While developers are
    moving quickly to erect new wind farms before the credit expires, AWEA
    remains hopeful that the incentive will be extended and continue to
    encourage additional projects in the future.
        For 1999, AWEA is preliminarily projecting 600 MW of new wind
    energy capacity, and between 120 and 250 MW of ``repowering''
    development at several older wind farms in California. The term
    repowering means removing older wind turbines and replacing them with
    new, more efficient turbines. At some sites in California one new wind
    machine can replace up to twelve turbines in operation since the early
    1980's while generating more electricity at a significantly lower cost.
        On the international front, wind power has been the fastest growing
    energy source in the world in the 1990's--with global installed
    generating capacity estimated to have grown by 25.7 percent annually
    since 1990. Worldwide, the wind industry doubled the amount of capacity
    in place three years ago, adding 2,100 megawatts (MW) to reach a total
    of 9,600 MW at the end of 1998. That amount of capacity is sufficient
    to generate approximately 21 billion kilowatt-hours of electricity, or
    enough power for 3.5 million suburban homes. Through this type of
    growth, wind power has become one of the most rapidly expanding
    industries, with worldwide equipment sales reaching roughly $2 billion
    in 1998.
        Small Wind Systems (i.e., 50 kW or less).--Although the worldwide
    market for small wind turbines (with a capacity of less than 50
    kilowatts per turbine) has not received as much attention, there is a
    growing recognition that the market for small wind turbines is becoming
    increasingly attractive. Small wind turbine markets are diverse, and
    include many applications both on-grid and off-grid. One market
    projection anticipates a five-fold increase in the small turbine market
    by 2005.
        Small turbines can provide electricity where none is available from
    conventional sources or where fuel costs are prohibitively high, such
    as diesel generators in Alaska. Currently, more than 2 billion people
    around the globe are not connected to an electric power grid and that
    number is growing. Small wind turbine manufacturers from Flagstaff,
    Arizona to Norman, Oklahoma, to Norwich, Vermont are working to capture
    this emerging market for U.S.-made goods and services.
        One or more small turbines can power a cabin, telecommunications
    relay, business, school, community center, clinic, or an entire
    village. Farmers can use small turbines to power their homes and other
    buildings or pump water for livestock or irrigation. In some cases,
    utilities may erect a cluster of turbines at the end of a distribution
    line instead of building a more expensive power plant or transmission
    line.
                     wind program fiscal year 2000 request
        AWEA supports DOE's fiscal 2000 wind program request of $45.6
    million. A strong Department of Energy research and development effort,
    aimed at achieving even further cost reductions, is a crucial component
    in continuing to grow the U.S. wind industry and build on the successes
    of 1998 outlined below.
        Applied Research.--About $13.5 million of the overall Wind program
    request would fund Applied Research containing core research efforts
    involving universities and private entities. Work focuses on advancing
    the U.S. wind energy technology base through research, testing, and
    analysis of complex interactions between wind turbine structures and
    materials. Efforts also examine how all parts of wind energy systems--
    blades, drivetrains, generators, power converters, control systems, and
    towers--can be optimized to increase reliability and further reduce
    costs.
        AWEA's member companies rely on these cost-shared efforts with DOE
    and its laboratories for this type of research because most individual
    companies are under-capitalized. Even larger corporations have limited
    capability to carry out basic research efforts without specialized
    assistance.
        Activities under the core research component of Applied Research
    are consistent with the recommendations of the President's Committee of
    Advisors on Science and Technology (PCAST) report on energy research
    and development to support research on computational fluid dynamics,
    light weight adaptive structures, advanced control systems, and
    variable speed and direct drive generators.
        The additional $2.8 million requested above fiscal year 1999
    funding would be applied to a new program--Wind Partnerships for
    Advanced Component Technologies (Wind PACT)--to establish industry-
    government teams to test promising new component parts. Under this
    effort, two to three R&D subcontracts would be competitively selected
    to explore potential concepts such as light-weight and direct-drive
    generators, flexible and articulated rotors, feedback controls for load
    alleviation, and high efficiency power converters.
        Applied Research also includes R&D for technologies that enable
    wind to be used in stand-alone, remote, or hybrid power systems. The
    combined use of wind turbines with diesel generators and other
    renewables and storage systems is a potentially large market for U.S.-
    made technologies. The key research issue in this area is designing a
    control system that allows diesel generators to be turned off, when
    intermittent wind power is being produced, thus reducing overall
    consumption of high-cost diesel fuel. In addition to laboratory R&D on
    control systems, this program supports ``real world'' control system
    field verification projects in Alaska. Approximately 60 percent of
    field verification costs are met by private industry.
        Ultimately, WindPACT and other Applied Research efforts are aimed
    at moving new technologies from the laboratories to the marketplace
    where they will directly benefit American consumers and taxpayers by
    spurring new job growth, cutting electricity generation costs, and
    reducing overall emissions of harmful air pollutants.
        Turbine Research.--About $20.2 million of the overall Wind program
    request would be invested in DOE's cost-shared Turbine Research program
    aimed at further reducing the cost of utility-scale wind power to a
    price approaching 2.5 cents per kilowatt-hour at 15 mph wind sites. The
    bulk of this effort is focused on completing research and development
    with two industry partners leading to state-of-the-art utility scale
    (500 kW--2 MW) wind turbines. These projects currently call for a 20--
    75 percent industry cost-share.
        The requested funding would support design review, analysis, and
    testing services needed for several new and on-going Turbine Research
    subcontracts with AWEA member companies. In addition, field
    verification projects would be initiated that would be tailored to
    satisfy specific regional needs. In addition, technical and data
    analyses support would be continued for ongoing utility-scale Turbine
    Verification Program projects.
        Another important component of this program would direct $1.3
    million in cost-shared R&D efforts to research, testing, and field
    verification of smaller wind turbines. This effort is aimed at
    assisting U.S. manufacturers capture a significant portion of the
    growing international market for small, distributed electricity
    generation throughout the developing world. Another component of the
    $20.4 million Turbine Research effort would provide $1.8 million for
    projects aimed at developing distributed (or, off-grid) wind resources
    on Native American Lands. The additional $4.8 million requested above
    fiscal year 1999 funding would be used for several field verification
    efforts aimed at moving new turbine designs from the laboratory to the
    marketplace.
        Cooperative Research & Testing Program.--About $11.9 million of the
    overall Wind program request would fund Cooperative Research and
    Testing efforts conducted at the National Wind Technology Center
    (NWTC), located new Rocky Flats, Colorado. The goal of this work is to
    resolve near-term technical questions and provide technical support
    thus allowing U.S. companies to better compete in world markets.
        The additional $3.2 million requested above fiscal year 1999
    funding would be used exclusively for field verification projects under
    the Hybrid Systems for Village Power program and wind monitoring/
    performance measurement at existing wind farms. This key efforts would
    build off of hybrid field verification work in Alaska and provide
    additional opportunities for field verification of new hybrid power
    systems developed in the area of Applied Research. In essence, this
    project would verify--through ``real world testing''--smaller wind
    systems at existing stand-alone diesel power sites in Alaska and other
    states, U.S. territories, Native American communities, and other
    remote, off-grid locations.
        A separate, but related, effort funded under Cooperative Research
    and Testing would support continued development of international
    consensus standards for wind turbine design, and establishment of wind
    turbine certification capability in the U.S. Both of these activities
    are essential to maximizing industry prospects for international sales
    of U.S. wind energy products and services.
                     wind power is working in these states
        Once based almost solely in California, the domestic wind energy
    industry now features utility-scale projects in 18 states. This
    economic expansion into the nation's heartland is directly tied to
    dramatic cost reductions and reliability improvements stemming from
    industry cost-shared partnerships with the Department of Energy
    laboratories. Below are some of the state success stories of the last
    year.
        Colorado.--New Belgium Brewing Company, of Fort Collins, CO,--
    makers of ``Fat Tire Amber Ale'' and other microbrews--said February 25
    that it will soon become the largest private consumer of wind power in
    the U.S. The decision has been put to a vote of the company's 70
    employees, who unanimously OK'd the switch to wind power even though
    the slightly increased cost cut into their bonuses, which are paid on a
    cost-per-barrel basis.
        By substituting 100 percent wind power for more conventional
    sources of electricity, the brewery will reduce the amount of coal
    burned by 980 tons per year and eliminate more than 4 million pounds of
    carbon dioxide emissions annually. The power will be supplied by Fort
    Collins Utilities (FCU), the city's municipal utility. A 660-kW wind
    turbine will be built next fall at the Platte River Power Authority's
    wind site near Medicine Bow, Wyoming, to support New Belgium's
    subscription to FCU's wind power program. The new turbine will produce
    about 1.8 million kilowatt-hours of electricity per year, which is
    about the amount of electricity that New Belgium will consume over 12
    months.
        Two 600-kW turbines have operated at the Medicine Bow site since
    April, 1998, producing power for 12 other Fort Collins businesses and
    approximately 520 residents who have subscribed to the utility's wind
    program.
        Iowa.--Enron Corp. is erecting 250 high-tech wind turbines near
    Alta and Storm Lake and will sell power to MidAmerican Energy. FPL
    Energy, Inc. (a subsidiary of Florida Power & Light) is building 56
    turbines at Clear Lake and selling power to Alliant Energy. When these
    new wind turbines go on line, Iowa will be the third-largest wind
    energy producing state in the nation, behind California and Minnesota.
        Illinois.--The initial startup of a new 60,000-square-foot wind
    turbine assembly plant in Champaign, IL has created 60 new jobs
    building 22 story-tall wind machines each weighing 23 tons. Workers
    have already built and shipped 56 turbines to a wind farm in Iowa and
    recently finished the first of four of 47 turbines headed for Texas.
    Owners, NEG Micon USA, Inc. (based in Rolling Meadows, IL) expect to
    assemble and deliver 250 wind turbines across the U.S. in 1999. When
    operating at full speed, the facility is capable of assembling more
    than 400 wind turbines per year.
        Minnesota.--Northern States Power Co. is building 425 MW of wind
    capacity by 2002. When complete, these wind farms will be producing
    enough energy to power the equivalent of 200,000 Minnesota households.
        New Mexico.--In April, Southwest Public Service Co. starts
    purchasing wind power from the brand new .7 MW Llano Estacado Wind
    Ranch located halfway between Clovis, NM and Farwell, TX. The one test-
    turbine is owned and maintained by Cielo Wind Power of Austin, TX. The
    Llano Estacado generator will be mounted on a 230-foot tubular steel
    tower and will be turned by three 80-foot long blades. Power is
    produced when wind velocity reaches eight to 60 miles-per-hour,
    although 25 MPH wind would be the most efficient. The generator will
    turn off when the wind velocity is more than 60 MPH.
        New Mexico is ranked #12 on a DOE list of the top 20 states for
    wind energy development potential--even higher than California which is
    ranked #17. With more turbines, New Mexico winds could produce 435
    billion kilowatt-hours annually, the wind energy could create 130,000
    jobs, and it has an economic potential of $10.9 billion.
        North Dakota.--Grand Forks, ND gained 130 new high-tech jobs
    earlier this year when LM Glasfiber, Inc., a wind turbine blade
    manufacturer based in Denmark, opened a new $5.8 million production
    facility in the town's new industrial park. More jobs will be added
    when the company soon adds a sales and service department.
        Oregon.--FPL Energy's new Vansycle wind farm, near the town of
    Pendleton, went on line in December of 1998. The project's 38 high-tech
    turbines are now producing about 25 MW of power--enough electricity to
    meet the needs of about 60,000 people--for customers of Portland
    General Electric.
        Texas.--(A) The largest wind turbines ever erected in North America
    were dedicated December 2, 1998 in Big Spring, Texas. Upon completion,
    the project's 46 wind turbines will produce about 117 million kilowatt-
    hours per year--enough electricity to serve the needs of 7,300 homes.
        (B) Reliant Energy HL&P, a major utility based in Houston, TX.,
    plans to offer its customers non-polluting electricity from the wind
    this summer. HL&P will be buying the power generated by 22.5 MW of wind
    capacity to be installed in the Delaware Mountain Wind Farm, which is
    now under construction in rural Culberson County in west Texas. The
    amount of electricity from the wind farm will be equivalent to the
    power needs of more than 4,000 homes. American National Wind Power
    (ANWP), a Houston-based wind farm developer, is scheduled to complete
    the wind plant's first phase, which will total 30 MW in capacity,
    before the end of June. ANWP hopes to ultimately expand the Delaware
    Mountain Wind Farm to 250 MW, which would make it the largest U.S. wind
    plant.
        Wyoming.--The Foote Creek wind farm will soon have the capacity to
    produce over 40 MW of power. Electricity generated at the site will be
    purchased by Pacificorp, the Bonneville Power Administration, and the
    Eugene (Oregon) Water & Electric Board.
                  renewable energy production incentive (repi)
        Year-to-year uncertainty regarding funding levels for the Renewable
    Energy Production Incentive (REPI) play havoc with the long-term
    planning needs of running a municipally-owned utility. For this reason,
    AWEA suggests the Congress work with the Department of Energy (DOE) to
    develop long-range alternatives to annual funding of this program.
        Assuming that significant changes in program funding and
    distribution are unlikely to occur this year, AWEA recommends fiscal
    year 2000 REPI funding of $8 million--$12 million below the $20 million
    need identified by DOE (in its fiscal year 1999 appropriations
    testimony) and by the American Public Power Association.
        AWEA's recommendation differs markedly from the Administration's
    proposed reduction to $1.5 million from current spending of $4 million
    (fiscal year 1999 level). AWEA's $8 million recommendation is the same
    funding level suggested in our fiscal year 1999 testimony.
        The REPI program, authorized by the Energy Policy Act of 1992,
    encourages municipally-owned utilities to invest in renewable energy
    technologies including wind energy systems. REPI permits DOE to make
    direct payments to publicly and cooperatively owned utilities at the
    rate of 1.5 cent per kilowatt-hour for electricity generated from wind,
    solar, geothermal, and biomass projects. Because wind energy projects
    require a two to three year lead time for permitting and construction,
    it is very important that stable and predictable funding be provided.
        REPI was established to ensure equity between investor-owned
    utilities--that utilize production tax credits--and publicly and
    cooperatively owned electric utilities that are unable to do so. REPI
    is particularly important in helping the following publicly owned
    utilities develop wind energy projects: Bonneville Power Administration
    (Washington, Oregon, Idaho, Montana); Cedar Falls Utilities (Iowa);
    City of Brownfield (Texas); Eugene Water & Electric Board (Oregon);
    Fort Collins Light & Power (Colorado); Lincoln Electric (Nebraska);
    Lower Colorado River Authority (Texas); Marshall Utilities (Minnesota);
    Moorhead Public Service (Minnesota); Nebraska Public Power District
    (Nebraska); Platte River Power Authority (Colorado); Princeton
    Municipal Light Dept. (Massachusetts); Sacramento Municipal Utility
    District (California); Traverse City Light & Power (Michigan); and
    Waverly Light & Power (Iowa).
                                   conclusion
        Smart investments in wind energy R&D have delivered--and are
    delivering--value for taxpayers by developing a clean domestic energy
    source providing significant economic, public health, and environmental
    benefits. Working with DOE, the wind industry has cut the per kilowatt-
    hour cost of wind power by more than 80 percent since the early 1980's
    thus allowing utility-scale wind development in 18 states and
    generating electricity equivalent to the residential electric needs of
    over one million Americans.
        As the cost of conventional electricity sources also continues to
    decline, a strong DOE wind energy research and development effort
    funded at $45.6 million is one crucial component of growing this
    industry.
        On behalf of the members and board of the American Wind Energy
    Association, I thank you for the chance to share our views on these
    important programs.
                                     ______

       Prepared Statement of the American Society of Mechanical Engineers
        Mr. Chairman and Members of the Subcommittee: The Energy Committee
    of the Council on Engineering of the American Society of Mechanical
    Engineers (ASME) is pleased to provide testimony on the fiscal year
    2000 budget request for the Department of Energy (DOE). Our testimony
    is directed to DOE's research and development (R&D) programs related to
    the use of renewable and nuclear energy and fundamental energy
    research.
                  introduction to the energy committee of asme
        The 125,000-member ASME is a worldwide engineering society focused
    on technical, educational, and research issues. It conducts one of the
    world's largest technical publishing operations, holds some 30
    technical conferences and 200 professional development courses each
    year, and sets many industrial and manufacturing standards. This
    testimony represents the considered judgment of the Energy Committee
    and is not necessarily a position of ASME as a whole. The Energy
    Committee consists primarily of members representing the eight
    technical divisions that address energy technologies and resources.
        Energy R&D was identified in a recent survey of ASME members as one
    of the most important public policy issues. Energy Committee members
    recommend that an energy policy:
      --maintain U.S. competitiveness in the international marketplace;
      --protect our national energy security;
      --seek technological solutions to concerns about global climate
            change and emissions of associated pollutants; and,
      --protect the environment in all phases of the energy cycle, from the
            extraction of fuels to the ultimate disposal of the byproducts.
                               role of technology
        Increased national and international concerns about the environment
    are placing higher demands on the performance of our energy systems. As
    engineers, we cannot emphasize strongly enough that investments in
    science, engineering, and technology are essential for enabling our
    nation to meet its needs for inexpensive energy that is produced and
    consumed in an environmentally friendly manner.
        Meeting our future energy needs in a manner consistent with
    national and global environmental well-being will require development
    of a broad suite of technologies ranging from renewables to nuclear
    energy. Fossil fuels, which are presently the worldwide predominant
    energy source, will remain the primary fuel for provision of energy for
    a number of years to come, both here and abroad. Therefore, efforts to
    improve the efficiency and environmental friendliness of their use will
    have a larger impact than might be true of other sources, particularly
    in the next 20 years. Those efforts must be complemented by R&D
    investments in a broad range of energy production technologies.
        The Energy Committee believes that immediate priority for increased
    funding for research programs should be given to:
      --programs that maintain or even increase the use of nuclear energy,
      --programs that develop renewable sources as viable energy options
            for both domestic and foreign implementation, and
      --programs that provide for basic research, which stimulates the
            development of innovative technologies, addresses major science
            and technology challenges, and maintains our educational
            pipeline to ensure the supply of human capital.
                    programs in the office of nuclear energy
        The Energy Committee supports the responsible use of all energy
    resources for generating electricity, transportation fuels, and use in
    the industrial, commercial, and residential sectors. Our assessment of
    energy use projections, such as presented in the EIA Annual Energy
    Outlook for 1998, lead to the conclusion that the United States must
    continue to maintain a diverse mix of energy supplies. The U.S.
    pioneered the safe utilization of atomic energy for commercial power
    production. Technology developed in the U.S. is now employed world-wide
    for nuclear power generation. For over two decades, no new nuclear
    power plants have been approved for construction in the U.S. Abroad,
    many countries are taking advantage of this clean, safe, and relatively
    inexpensive power source. The U.S. has the opportunity to renew its
    option on the effective use of nuclear power, which many believe will
    be a vital part of a future where carbon emissions may be severely
    curtailed. However, this will not be possible without significant,
    sustained, national investment, coupled with the re-licensing of
    existing U.S. nuclear plants.
    Nuclear energy plant optimization
        The Energy Committee is particularly supportive of efforts to
    address extending the life and improve the effectiveness of
    conventional nuclear power plants. The Nuclear Energy Plant
    Optimization (NEPO) program marks the beginning of efforts to enable
    maximum use of our existing nuclear generation capacity. Major advances
    in science and technology offer the potential to substantially increase
    the productive life of nuclear plants with improved safety and economic
    performance. Given the potential benefits offered by the NEPO program,
    the Energy Committee encourages consideration of additional funding,
    above the $5 million proposed by the Administration for fiscal year
    2000 to $10 million, with appropriate and justified increases in future
    years.
    Nuclear energy research initiative (NERI)
        Renewal of efforts to develop fundamental new technology for future
    nuclear power generation was supported by the Energy Committee last
    year, and we continue to endorse investment in this young program.
    Increased understanding of nuclear power technology, advances in
    materials science, and improvements in many related sciences and
    technology offer the potential to reduce plant construction and
    operation costs and waste management requirements, and improve plant
    operability, reliability, lifespan, and safety. A substantial fraction
    of this initiative will go toward nurturing university research and
    education in nuclear science and engineering, through direct funding
    and reinforcing linkages between the nuclear technical community in
    industry and our national laboratories. It will help ensure the
    availability of an improved nuclear power option for the future, which
    will benefit the U.S. by enhancing power production in this country and
    enabling U.S. industry to compete effectively in the global energy
    markets. The Energy Committee supports the increase in funding proposed
    for this program.
    Other nuclear programs
        Consistent with support of the NERI program, the Energy Committee
    supports continued investment in the University Reactor Fuel Assistance
    and Support (URFAS) efforts. It is reasonable to believe that increased
    investment in NERI and NEPO will require greater utilization of our
    university reactors, therefore, the Energy Committee recommends a
    modest increase to $13 million for fiscal year 2000.
        The Energy Committee supports continuation of the Advanced
    Radioisotope Program at the level proposed by the Administration (no
    change from fiscal year 1999). The Energy Committee also supports
    continued efforts to support establishment of a commercial application
    for the Fast Flux Test Facility (FFTF) at the level ($30 million)
    proposed by the Administration. This effort is particularly prudent
    considering the Administration-proposed establishment of an Advanced
    Nuclear Medicine Initiative that would augment the commercial mission
    envisioned for FFTF of medical isotope production.
             programs in solar and renewable resources technologies
        The development of technologies that enable use of solar and
    renewable resources are of significant strategic importance to the U.S.
    Development of competitive renewable options provides insurance for
    potential energy security and global climate change impacts on our
    energy future. They will enable the U.S. to achieve a more sustainable
    energy economy.
        The development of solar and renewable resource technologies
    provides one of the greatest challenges to modern science and
    engineering. Consistent with the magnitude of the challenge, it will be
    necessary to sustain investment over long periods of time to enable
    substantial progress in this arena. The Administration has proposed
    substantial increases in funding for solar and renewable programs,
    largely because of their potential to contribute to reduction of global
    climate change emissions. It is likely, however, that efforts to
    improve efficiency and reduce carbon emissions of fossil energy
    technologies could have a larger near-term impact on global climate
    change emissions than comparable investments in solar and renewable
    technology.
    Solar/renewable energy programs
        The Energy Committee strongly encourages continued support of
    fundamental science and engineering to facilitate discovery and
    development of breakthrough technologies in all solar and renewable
    resource applications. A key aspect of R&D should focus on the
    development of innovative concepts at universities to complement the
    work being pursued by the national laboratories. Demonstration programs
    are an essential element to both evaluate technologies and to address
    the many challenging operations and integration issues, and should be
    focused on resolving performance uncertainties, examining systemic and
    integration issues, and reducing cost and risk for commercial
    development and deployment. Such programs should not attempt to create
    a market for these technologies, which properly remains the
    responsibility of industry.
        The Solar Buildings and Hydropower programs are very small, with
    small dollar increases. Both of these programs favorably impact the use
    of renewable energy, at good cost/benefit ratios. The larger programs,
    Concentrating Solar and Geothermal Energy, are slated for modest
    increases (11 percent and 4 percent, respectively), which appear
    appropriate considering their contributions.
        The substantial increase (over 25 percent) in the hydrogen program
    does not seem justified. Careful consideration of the rationale for
    aggressive development of ``pure'' hydrogen technology systems should
    be undertaken in light of the potential for on-board and on-site
    conversion of hydrocarbon fuels to hydrogen offered by several
    developing technologies. Furthermore, the time scale for implementation
    of the ``hydrogen economy,'' should it become necessary and
    economically feasible, is sufficiently long that urgent development is
    not now required. The $7.5 million (24 percent) increase in the Biomass
    program also does not seem to be merited in terms of its near-term
    contribution to the nation's energy needs, unless the ``co-firing with
    coal'' project can be shown to significantly reduce greenhouse gas
    emissions.
        The major program dollar and percentage increases (about 30 percent
    each) are in the two biggest programs: Wind and Photovoltaics (PV).
    Both of these technologies have viable industries and are in a
    ``globally competitive'' mode, with research and development
    investments driving down the delivered energy price of each. It is to
    the advantage of the United States to be pre-eminent in both of these
    technologies because of the value of their export markets and also
    because of the energy security and emission-reduction objectives
    offered by both technologies. The PV program represents the renewable
    technology with the greatest overall energy/power potential, and also
    has been a program with steadily increasing efficiency and reduced
    energy/power costs. Both programs should continue to be examined for
    benefits versus costs, especially with large program funding increases.
                       programs in the office of science
        The bulk of funding allocated for programs in the Office of Science
    support efforts along four themes, (1) the physics of matter, (2)
    global climate change research, (3) fundamental transport and
    conversion processes, and (4) advanced computation and information
    technologies. The scientific merits of the majority of these programs
    have been well documented and have earned the support of the Energy
    Committee. The most substantial changes proposed for fiscal year 2000
    relate to (1) the continued construction of the Spallation Neutron
    Source ($84 million), which the Energy Committee generally supports,
    and (2) initiation of the DOE elements of the Administration's
    Information Technology for the Twenty-First Century initiative (IT\2\)
    ($68.5 million).
        The Energy Committee strongly endorses the DOE efforts under the
    IT\2\ with certain reservations. We applaud the inclusion of combustion
    processes as a major computation challenge of which the Scientific
    Simulation Initiative is a small portion ($7 million) of the proposed
    funding. However, there are a great many additional challenges that
    defy present engineering simulation (such as on-line simulation of
    power grid dynamics, or composite material behavior) that would be
    worthy research areas for advanced simulation. The development of
    engineering simulation approaches has been less well represented in DOE
    efforts than scientific computing, yet investments in engineering
    simulation can often result in rapid translation into domestic economic
    growth. We therefore support increased funding for the Simulation
    Initiative to enable establishment of a more substantial programmatic
    effort in engineering simulation as part of this new initiative.
        Lastly, the Energy Committee is concerned that the Science
    Education budget remains under funded, at $4.5 million. ASME has long
    championed increased attention to science, mathematics and technical
    education at all levels, but particularly in grades K-12. Considering
    that almost $3 billion is budgeted for the DOE Office of Science, it
    seems only reasonable that efforts to translate the scientific and
    engineering experience of the present generation to those who will be
    responsible for our future should be of paramount importance. We
    therefore recommend a budget of $6 million for Science Education as the
    first step toward increasing the interest and enthusiasm of our youth
    for science and engineering.
        Thank you for the opportunity to offer testimony regarding the
    renewable, nuclear, and science budgets proposed for the Department of
    Energy. ASME's Energy Committee will be pleased to respond to requests
    for additional information or perspectives on other aspects of our
    nation's energy program.
                                     ______

     Prepared Statement of Chester A. Farris, III, Chairman, Photovoltaics
              Division, Solar Energy Industries Association (SEIA)
        The Solar Energy Industries Association (SEIA) is the national
    industry association of the solar electric and solar thermal companies
    in the United States. The Photovoltaics Division represents those
    industry members who manufacture, distribute, and install solar
    electric technologies known as photovoltaics (PV).
        The Division strongly supports the Administration's fiscal year
    2000 recommendation for $93 million in research and development funding
    for photovoltaic technology. Over the last several years, federally-
    supported photovoltaic research at the National Renewable Energy
    Laboratory, Sandia National Laboratories, universities, and the private
    sector has yielded stunning results, enabling the U.S. to retain its
    worldwide technological leadership position.
        The industry respectfully solicits the Subcommittee to fund
    critical cost-shared programs at the level of the Administration's
    request. In order of priority, these programs are:
        1. Thin Film Partnership
        2. PV Manufacturing Technology R&D (PV MaT)
        3. Million Solar Roofs and Building-integrated PV R&D
        4. System Engineering and Reliability
        5. High Performance R&D
                              the industry request
        The Photovoltaics RD&D Program administered by the U.S. Department
    of Energy has consistently achieved its long-and short-term goals and
    objectives.
        The primary goal of the Program is to conduct pure and applied
    research on new materials and processes to lower the cost of
    photovoltaics and boost user confidence in the application of this
    innovative technology. The governments of Germany and Japan have
    initiatives far more ambitious than those outlined by the fiscal year
    2000 recommendation.
        The US photovoltaics industry is comprised of over 20 US-based
    manufacturers, 100 distribution and system integration firms, and over
    100 solar electric installation companies. The US industry leads the
    world technologically and has a dominant market share of over 40
    percent. The ability to maintain America's leadership position can only
    be sustained by leveling the playing field by fully funding the
    programs proposed in the Administration's budget. Funding in Japan's
    photovoltaics program now exceeds US $250 million per year. Germany has
    launched a program to install 100,000 rooftop systems that would
    increase the country's PV market requirement by an order of magnitude.
        To date, the DOE Photovoltaics Program has been very effective in
    directing the resources of the National Renewable Energy Laboratory
    (NREL) and Sandia National Laboratories, which are jointly known as the
    National Center for Photovoltaics (NCPV). The Labs' technical
    competency and analytical capabilities have resulted in significant
    improvements in the cost, reliability, and performance of photovoltaic
    cells, modules, and systems. Research areas of particular note include
    new substrate materials (high-strength glass and plastics), process
    technology, building-integrated photovoltaics, and system measurement
    and performance.
        At the Subcommittee's request, the DOE Photovoltaics Program has
    dramatically reduced ``uncosted'' balances, becoming the leading
    renewable energy program to do so. The DOE Photovoltaics Program awards
    funding almost entirely on a competitive bid basis and is well managed
    and directed.
        The Thin Film R&D and PV Manufacturing Technology programs have
    resulted in a reduction in photovoltaic cell and panel manufacturing
    costs from $50 per watt in 1976 to below $5 per watt today, a ten-fold
    decrease. To reach parity with conventional power generation
    technologies, our industry must continue to drive this cost down
    further. This goal can only be achieved through aggressive R&D and
    manufacturing technology programs such as the Thin Film Partnership and
    the PV MaT Program. The current cost-sharing methodology used by the
    Department ensures that participating companies must fully commit their
    own dollars towards this goal, as well.
        The Million Solar Roofs Initiative, announced by the Administration
    in 1997, has encouraged several state agencies, local governments, and
    electric utilities to establish promotion and technical assistance
    programs for photovoltaics. However, the Million Solar Roofs Program
    requires additional funding in order to ensure the long-term viability
    of the US industry which is continually threatened by foreign
    government subsidy programs.
        Historically, it has taken considerable courage and foresight from
    our elected officials to put in place infrastructure programs that have
    long-term benefits to this country. America's highways, electricity
    generation and distribution systems, aviation management systems, and
    state and national parks were championed at times when such spending
    was criticized.
        The future economic strength of any nation is highly dependent on
    readily available, reliable, affordable, and clean energy. To ensure
    our nation's long-term energy security, independence, and
    sustainability, the government's support is absolutely crucial. Without
    question, this will be a daunting task. Photovoltaics have been and
    will continue to be a pivotal technology to achieve these goals in the
    new millenium.
        The US photovoltaics industry urges you to support the
    Administration's fiscal year 2000 recommendation of $93 million, which
    includes explicit specific language supporting pure and applied
    research, technology improvement and validation, and commercialization
    technical assistance. Thank you.
                                     ______

     Prepared Statement of Les Nelson, Chairman, Solar Thermal & Building
         Products Division, Solar Energy Industries Association (SEIA)
                               executive summary
        The Solar Energy Industries Association (SEIA) is the national
    industry association of the photovoltaics and solar thermal equipment
    manufacturers, component suppliers, distributors, and installers (via
    our affiliated state and regional chapters). The Solar Thermal and
    Building Products Division represents the section of SEIA's members who
    are involved in solar water heating and solar space heating
    technologies primarily for buildings, but also for commercial and
    industrial processes and facilities.
        The Division strongly supports the Administration's fiscal year
    2000 recommendation for $5.5 million in funding a focused set of
    research activities primarily at the National Renewable Energy
    Laboratory and Sandia National Labs and select Universities. However,
    to insure that the funding in research has a pathway towards the
    private sector, the industry respectfully requests the Subcommittee to
    endorse a limited set of technology validation activities to promote
    new efficiencies in technology, greater utility of use by emerging
    markets, and analysis for barrier reduction in regard to pollution
    prevention, electricity displacement and load shifting, and building
    integration.
                              the industry request
        The Solar Buildings RD&D program administered by the U.S.
    Department of Energy has been one of the under-appreciated RD&D
    programs.
        The goal of the program is to significantly reduce solar system
    installed costs and operation and maintenance costs, largely through
    research on technical innovations and lower cost materials, while
    providing technical assistance to energy service companies, solar
    companies and utilities on effective utilization of solar for load
    shifting, demand management, pollution prevention, and emerging energy
    service businesses.
        The solar thermal industry is comprised entirely of small
    businesses with nearly 400 US-based companies involved in the
    manufacturing, distribution and installation of solar thermal systems.
        The program has been extremely effective in directing the resources
    of the National Renewable Energy Laboratory, Sandia National
    Laboratory, the Florida Solar Energy Center and others in developing
    their technical competency to drive whole new areas of RD&D that can be
    transferred to the U.S. industry. Computer modeling of system
    performance, evolution of new concepts, and provision of technical
    assistance to emerging endusers are all quantifiable results of this
    program.
        The Subcommittee has explicitly endorsed RD&D and commercialization
    efforts for other building-based technologies such as geothermal heat
    pumps. The solar thermal technologies are as deserving, not only
    because solar is a viable, clean, cost-effective option, but because
    the U.S. solar industry has a clear record of cost-shared RD&D tied to
    a willing utility and consumer base.
        The Million Solar Roofs initiative, announced by The Administration
    in 1997, has leveraged several local governments, utilities and states
    to establish an aggressive promotion and technical assistance efforts
    for solar thermal. The emerging technologies that DOE has worked so
    ardently with industry to develop, should be allowed to penetrate this
    evolving market.
        The U.S. Department of Energy along with its national laboratories
    and university partners are essential for the growth of this industry.
    There is an established need by state air quality offices to be
    provided analytical tools to quantify solar water heating pollution
    prevention benefits. Similarly, the utility industry wants quantifiable
    analysis on the demand reduction profiles of solar, while the new home
    construction market demands products which can be integrated with
    existing construction practices and products.
        The research base is in place, the U.S. solar industry has shown to
    be a reliable and willing partner, and the market is on the cusp of
    growing with the appropriate and focused technical assistance.
        The solar building industries urge you to support the fiscal year
    2000 level of $5.5 million which includes specific language supporting
    pure and applied research, technology validation, and commercialization
    technical assistance. Thank you.
                                     ______

     Prepared Statement of Lennart Johansson, Chairman, Solar Thermalpower
              Division, Solar Energy Industries Association (SEIA)
                               executive summary
        The Solar Energy Industries Association (SEIA) is the national
    industry association of the photovoltaics and solar thermal equipment
    manufacturers, component suppliers, distributors, and installers (via
    our affiliated state and regional chapters). The Solar Thermal Power
    Division represents the section of SEIA's members who are involved in
    concentrating solar energy technologies primarily for electricity
    generation, but also for thermal energy commercial and industrial
    processes and facilities.
        The Division strongly supports the Administration's fiscal year
    2000 recommendation for $18.7 million in funding a focused set of
    research activities primarily at the National Renewable Energy
    Laboratory and Sandia National Laboratories. However, to insure that
    the funding in research has a pathway towards the private sector, the
    industry respectfully requests the Subcommittee to endorse a limited
    set of technology validation activities to validate system performance
    from the combined set of components created through joint collaboration
    of US industry and the national laboratories via DOE.
                              the industry request
        The Concentrating Solar Power RD&D program administered by the U.S.
    Department of Energy has been one of the DOE programs that have been on
    time, on budget, and shown proven merits.
        The goal of the program is to increase the efficiency of a variety
    of promising solar thermal technologies; to perform research on
    optimizing solar thermal operations for solar troughs; to undertake
    systems validations and lend competent technical assistance for solar
    driven engine systems, to hone performance tools and to provide
    technical assistance to energy service providers, solar-energy-related
    companies and utilities on the effective utilization of solar for load
    shifting, demand management, pollution prevention and the development
    of emerging energy service businesses.
        The concentrating solar thermal industry currently holds global
    technical leadership with nearly 40 US-based companies involved in the
    manufacturing, distribution and installation of concentrating solar
    thermal systems.
        To date, the DOE RD&D program for Concentrating Solar Power has
    been extremely effective. Solar Dish engines systems were installed at
    The Pentagon, at the National Renewable Energy Laboratory in Colorado
    and in Arizona in 1998. These systems needs continued validation and
    expansion to other sites.
        The solar trough systems are going through another year of new
    technical O&M approaches in California where over 350 megawatts of
    power are being produced. Over the last decade, the cost per kWh has
    dropped from approximately 25 cents down to the 8- to 9-cent range with
    further improvements expected for new projects with the assistance of a
    continued and well-focussed RD&D program.
        Largely due to the success of the program, international interest
    has increased with potential trough projects under discussion in
    Australia, Brazil, China, Egypt, Greece, Mexico, Morocco and Spain.
    With the increasing international interest, U.S. industries could be
    poised on the cusp of a potential new wave of technology export
    opportunities. Without a continued strong commitment by the USDOE to
    support the solar thermal RD&D program, US industry alone may not be
    able to maintain it's position of leadership in the face of the high
    level of support being lent similar programs by the European Union and
    other countries.
        The Department of Energy has not been clear, however, on the
    direction of this emerging technology program even though the costs of
    the technology and the actual performance of solar concentrating
    technologies have far exceeded several other major programs in their
    energy R&D portfolio. This RD&D program typifies the need for federal
    involvement, pre-commercial, non-incremental improvement and a solid
    R&D basis--the epitome of what the Subcommittee has expressed in
    earlier hearings.
        The utilization of solar concentrating technologies has a pragmatic
    path to the marketplace if the pure and applied RD&D are sustained.
    Arizona Public Service, Public Service of New Mexico, and other
    utilities have shown a solid commitment and excitement on the prospects
    of this emerging technology. Aside from displacing the need for
    conventional fossil-fuel combustion when the sun is shining, the vast
    potential for utilizing clean-burning natural gas as a solar-hybrid-
    generator to make solar thermal electric generation fully dispatchable
    is a big plus. The hybrid solar/natural gas approach is used with great
    success today in the solar trough plants in California. The modularity
    of the technology also situates it as useful during a restructured era
    in the electric utility where incremental generation and investment
    provides far more flexibility than traditional large-scale baseload
    electric generation units.
        The concentrating solar thermal industries urge you to support the
    fiscal year 2000 level of $18.5 million which includes specific
    language supporting pure and applied research, technology validation,
    and commercialization technical assistance. Thank you.
                                     ______

     Prepared Statement of Dr. Donald L. Klass, President, Biomass Energy
                              Research Association
        This testimony pertains to the fiscal year 2000 appropriations for
    mission-oriented, biomass energy and fuels research, development, and
    deployment (RD&D) programs carried out by DOE's Office of Energy
    Efficiency and Renewable Energy (EERE). The Biomass Energy Research
    Association (BERA) is a non-profit association in Washington, DC. BERA
    was founded in 1982 by researchers and private organizations that are
    conducting biofuels research. Our objectives are to promote education
    and research on renewable biomass energy and waste-to-energy systems
    that can be economically utilized by the public, and to serve as a
    source of information on biomass policies and programs.
        I would like to thank you, Mr. Chairman, on behalf of BERA's
    members for the opportunity to present our position on the federal
    funding of mission-oriented biomass RD&D. Continued support of this
    effort is essential to provide the stimulus to develop environmentally
    clean, indigenous energy resources that can displace fossil fuels,
    stimulate regional and national economic development and employment,
    reduce our dependence on imported oil, improve our energy security, and
    help to eliminate adverse climate and environmental changes.
        I have examined EERE's appropriations request for biomass energy
    and fuels RD&D in fiscall year 2000, and would like to offer a few
    comments about our Board's concerns before presenting BERA's
    recommendations. DOE continues to over-emphasize scale-up projects, the
    budgets for which are large and which adversely impact the research
    budgets. DOE has therefore been required to terminate research in
    several microbial and thermochemical conversion areas. We feel that a
    balanced research program should be sustained and protected, so BERA
    continues to recommend both a diversified portfolio of research and an
    appropriate amount of funding for scale-up without diminishing either
    EERE's research or scale-up programs. Also, DOE's research on biomass
    energy outside of EERE by the Office of Science (OS, former Office of
    Energy Research), which supports basic academic research, and by the
    EERE's Office of Industrial Technologies (OIT) on chemicals from
    biomass, complements EERE's biomass energy and fuels RD&D. All biomass
    programs should be internally coordinated and jointly managed at DOE
    Headquarters. Note that for fiscal year 2000, EERE's biomass-based
    research under the title Hydrogen Research in the funding request is
    included in BERA's recommendations, but our recommendations for OIT's
    Agriculture Vision chemicals-from-biomass program are presented in a
    separate BERA statement for the Interior and Related Agencies Bill.
        EERE's appropriations request for biomass energy and fuels RD&D in
    fiscal year 2000 includes details that have normally not been presented
    in the past. We commend EERE for updating their biomass RD&D plan so
    that it is now reasonably clear which projects have been completed,
    terminated, or are new starts. Specifically, BERA recommends that
    $113.7 million be appropriated for biomass energy and fuels RD&D in
    fiscal year 2000. The highlights are:
      --A total of $61.2 million for research and $52.5 million for
            industry cost-shared scale-up.
      --$31.2 million for research and $28 million for industry cost-shared
            scale-up projects for Power Systems. The scale-up projects
            include the integrated biomass production-conversion and
            Vermont gasification projects.
      --$25.5 million for research and $24 million for industry cost-shared
            scale-up projects for Transportation. The scale-up projects
            include the NREL ethanol pilot plant in Colorado, and
            commercial ethanol plants in Alaska, California, New York, and
            Louisiana.
      --$4 million for biomass-based hydrogen research.
      --$1 million for internal coordination and joint management of all
            DOE biomass programs.
                allocation of appropriation recommended by bera
        BERA recommends that the appropriation for fiscal year 2000 be
    allocated as shown in the table. BERA's recommendations are generally
    listed in the same order as DOE's request for fiscal year 2000, except
    we include several research areas that are either new or that BERA's
    Board recommends be restored to sustain a balanced program of research
    and scale-up. Note that the recommended budget for each scale-up
    category does not include industry cost-sharing, which is required to
    be a minimum of 50 percent of the total budget for each project.

                OFFICE OF ENERGY EFFICIENCY AND RENEWABLE ENERGY
    ------------------------------------------------------------------------
                                                    Recommended budget
                  Program area               -------------------------------
                                               For research    For scale-up
    ------------------------------------------------------------------------
                  Power Systems
    Thermochemical Conversion:
        Advanced Combustion.................      $2,000,000  ..............
        Advanced Gasification...............       2,500,000  ..............
        Advanced Pyrolysis..................       2,000,000  ..............
        Advanced Stationary Fuel Cells......       2,000,000  ..............
        Improved Emission Control...........       2,000,000  ..............
        Wastewater Treatment................       1,500,000  ..............
        Ash Disposal and New Uses...........       1,500,000  ..............
        Hot-Gas Clean-Up....................       2,000,000  ..............
        Advanced Materials..................         700,000  ..............
    Microbial Conversion: Advanced Anaerobic       2,000,000  ..............
     Digestion..............................
    Systems Development:
        Vermont Gasifier....................  ..............      $6,000,000
        Integrated Production-Conversion....  ..............      19,000,000
        Advanced Cofiring with Coal.........       2,000,000  ..............
        Small Modular Systems...............       2,500,000  ..............
    Municipal Solid Waste...................       3,500,000  ..............
    Pelletized Biomass Fuel Systems.........         500,000  ..............
    Feedstock Production....................       2,000,000       2,000,000
    Regional Biomass Energy Program.........       2,500,000       1,000,000
                                             -------------------------------
          Subtotal..........................      31,200,000      28,000,000

                 Transportation
    Fermentation Ethanol:
        Advanced Organisms..................       3,000,000  ..............
        Advanced Enzymes....................       3,000,000  ..............
        Advanced Pretreatment...............       2,000,000  ..............
        NREL Pretreatment Pilot Reactor.....  ..............       3,000,000
        NREL Fermentation Pilot Plant.......  ..............       5,000,000
    Commercial Ethanol Plants by Company and
     Location:
        BCI International, Gridley, CA \2\..  ..............       5,000,000
        Massada Resources, NY \3\ and         ..............   \7\ 7,000,000
         Sealaska, AK \4\...................
        Arkenol, Rio Linda, CA \5\..........  ..............         ( \8\ )
        BCI International, Jenninqs, LA \6\.  ..............         ( \9\ )
    Advanced Mobile Fuel Cells..............       3,000,000  ..............
    Biodiesel...............................       1,000,000  ..............
    Feedstock Production....................       2,000,000       3,000,000
    Thermochemical Conversion:
        Ethanol Production..................       3,000,000  ..............
        Mixed Alcohols Production...........       3,000,000  ..............
        Oxygenates from Biomass.............       3,000,000  ..............
    Regional Biomass Energy Program.........       2,500,000       1,000,000
                                             -------------------------------
          Subtotal..........................      25,500,000      24,000,000

              Hydrogen Research \1\

    Advanced Thermal Processes..............       2,000,000  ..............
    Advanced Photolytic Processes...........       2,000,000  ..............
                                             -------------------------------
          Subtotal..........................       4,000,000  ..............

            Integrated Bioenergy RD&D

    Coordination and Integration............         500,000         500,000
                                             -------------------------------
          Total.............................      61,200,000      52,500,000
                                             -------------------------------
          Grand Total.......................           113,700,000
    ------------------------------------------------------------------------
    \1\ BERA's recommendations pertain only to the biomass-based portion of
      Hydrogen Research.
    \2\ Rice straw, dilute acid.
    \3\ Refuse-derived fuel, concentrated acid.
    \4\ Waste softwoods.
    \5\ Rice straw, concentrated acid.
    \6\ Bagasse, dilute acid.
    \7\ For Masada and Sealaska plants, and initiation of corn-enzyme
      hydrolysis and fossil-derived syngas-microbial ethanol production
      plants.
    \8\ DOE's share of funding completed.
    \9\ DOE supplied $4,000,000 in fiscal year 1999.

       bera recommends $61.2 million for research and $52.5 million for
          industry cost-shared, scale-up projects for fiscal year 2000
        BERA's recommendations consist of a balanced program of mission-
    oriented RD&D on feedstock production and conversion research and
    technology transfer to the private sector. Advanced power generation
    technologies and alternative liquid transportation fuels are
    emphasized.
        In addition, BERA strongly urges that at least 50 percent of the
    federal funds for biomass research, excluding the funds for scale-up
    projects, are used to sustain a national biomass science and technology
    base via subcontractors outside DOE's national laboratories. While it
    is desirable for the national laboratories to monitor this research,
    increased support for US scientists and engineers in industry, academe,
    and research institutes that are unable to fund biomass research will
    encourage commercialization of emerging technologies and serious
    consideration of new ideas. It will also help to expand the
    professional development and expertise of diverse researchers committed
    to the advancement of biomass technologies.
        BERA's specific recommendations for research, the industry cost-
    shared scale-up projects, and the dollar allocations are listed in the
    table (page 2). Additional commentary on each program area is presented
    below in the same order as in the table.
                                 power systems
        Thermochemical Conversion.--Currently, there is over 8,000 MW of
    electric power capacity fueled by biomass in the United States.
    Municipal solid wastes, forest and wood processing residues and pulping
    liquors are the primary fuels. Continued research to develop advanced
    biomass combustion, gasification, and pyrolysis methods could have
    environmental and economic benefits that can lead to significant growth
    in biomass power generation. Much of this research has been phased out
    by DOE. Research (not scale-up) should be initiated or re-stored with
    the goal of developing the next generation of thermochemical biomass
    conversion processes for power generation. Stationary, integrated
    biomass gasifier-fuel cell systems should be developed as potential,
    high-efficiency power generation systems. New fuel cells that can
    tolerate the sulfur levels found in certain biomass-derived fuel gases
    without sacrificing system affordability and the testing of integrated
    advanced fuel cell systems should be included in this work. In addition
    to the restoration of this important research, priority should also be
    given to the development of innovative enabling technologies consisting
    of advanced emission control systems, improved ash disposal methods and
    new ash uses, low-cost, hot-gas clean-up methods, and advanced
    materials that eliminate corrosion and erosion problems for
    thermochemical reactors and turbines. The status of these technologies
    is far from what is needed, yet they are essential for practical, low-
    cost thermochemical conversion of biomass.
        Microbial Conversion.--Microbiological gasification by anaerobic
    digestion is unique in that it produces methane directly, the major
    component in natural gas, as a primary product from a full range of
    virgin and waste biomass feedstocks. However, DOE has terminated most
    of the research needed to develop advanced systems that yield low-cost
    methane by reducing capital and operating costs. This research can lead
    to the alleviation of numerous environmental problems encountered
    during waste treatment and disposal, and should be restored.
        Systems Development.--The scale-up of biomass gasification for
    medium-Btu gas and power generation in Vermont continued in fiscal year
    1999. This project should be funded in fiscal year 2000 to enable
    testing of an advanced turbine system for the generation of 8-12 MW
    from wood. The testing in Hawaii of the hot gas clean-up system, which
    was shown in the preliminary work to be effective, was not completed
    because the gasifier was shut down. This work should be completed, at
    another site if necessary, to perfect the technology. The integrated
    biomass production-power generation projects chosen by DOE for scale-up
    in Minnesota (alfalfa), New York (willow-coal cofiring), and Iowa
    (switchgrass-coal cofiring) as well as DOE's initiative to expand
    biomass-coal cofiring at additional sites should be continued. Plans
    should also be made to fund scale-up of the Whole Tree Energy system as
    part of this effort. Research on the development of advanced biomass-
    coal cofiring systems and small modular direct biomass combustion
    turbines should be sustained to develop advanced designs for small
    modular systems, and advanced combined cycle systems that can supply
    cogenerated power.
        Municipal Solid Waste.--MSW disposal is a continuing national
    problem, which when combined with energy recovery, offers major
    opportunities for power generation and recycling. Advanced MSW
    disposal-energy recovery systems are needed for municipalities; there
    is also a need for small, low-cost systems. Research in each of these
    areas should be restored.
        Pelletized Biomass Fuel Systems.--Research is needed to develop
    low-cost, high-productivity biomass pelletizing and supply systems, and
    automated residential and commercial heating units designed for these
    fuels. The unavailability of such systems has been a large barrier to
    the growth and expansion of residential and commercial biomass fuel
    markets.
        Feedstock Production.--See Feedstock Production in next section.
        Regional Biomass Energy Program.--The Regional Biomass Energy
    Program (RBEP), established by Congress in 1983, to take advantage of
    the regional differences in biomass resources and energy needs, are
    implemented through five separate regions located in the Southeast,
    Northwest, West, Great Lakes, and Northeast. The RBEP has been
    important in establishing individual state biomass programs, and in
    stimulating technology transfer and the development and
    commercialization of biomass energy in the private sector. RBEP
    activities have created awareness and a positive image for biomass
    energy while providing significant environmental enhancement and
    creating new jobs, especially in rural areas. The private sector and
    the states have been highly supportive of the RBEP and typically
    provide 2 to 4 times the federal investment as cost sharing. In fiscal
    year 2000, the RBEP will conduct activities to develop and encourage
    the commercialization of technologies for power generation with
    biomass, biomass-coal cofiring, small-scale distributed generation
    systems, and biogas systems. These activities may include several
    state-level, one-day workshops to educate stakeholders and to
    facilitate the addition of new generating capacity based on biomass
    fuels. Development of integrated disposal-biogas recovery systems will
    be continued because the disposal of large quantities of animal manures
    continues to be a major national problem.
                                 transportation
        Fermentation Ethanol.--Research on the conversion of low-cost
    lignocellulosics to fermentation ethanol should be continued. The
    targets should include the development of: genetically engineered
    organisms that can simultaneously ferment all the C5/C6 sugars in
    biomass; low-cost cellulase production for simultaneous
    saccharification-fermentation; and advanced pretreatment of low-cost
    biomass feedstocks, including the testing of the counter-current
    pretreatment pilot plant reactor recently installed at NREL. This
    research should focus on the development of accurate bases from which
    advanced technologies can be scaled-up for commercial use with
    confidence, and on advanced technologies that significantly reduce
    processing costs. NREL's ethanol pilot plant should be operated on an
    as-needed, cost-shared basis with DOE's industrial partners to support
    the commercial ethanol plant program
        Commercial Ethanol Plants.--Several fermentation plants are being
    cost-shared by DOE in fiscal year 2000 as shown in the table on page 2.
    The processes used are conventional and advanced technologies, such as
    the microbial conversion of synthesis gas. The preliminary planning
    work for other plants should continue, but BERA recommends that the
    existing projects should produce operating data that confirm the
    technologies before new scale-up projects are started.
        Advanced Mobile Fuel Cells.--Research should be initiated to design
    and perfect vehicular fuel cell systems equipped with on-board
    reforming units for biomass-based liquids. The goal should be the
    production of low-cost fuel gases suitable for direct use as motor
    fuels and as fuels for on-board fuel cells.
        Biodiesel.--Research should be focused on increasing natural
    triglyceride yields to permit low-cost biodiesel production. Advanced
    transesterification processes are already available, and engine and
    emissions tests have been or are being performed by the engine
    manufacturers.
        Feedstock Production.--Land-based biomass grown as energy crops can
    supply large amounts of fossil fuel substitutes. Considerable progress
    has been made on the efficient production of short-rotation woody
    crops, and on the growth of herbaceous species. In addition, research
    on tissue culture techniques and on the application of genetic
    engineering methods for low-cost energy crop production have shown
    promise. This research should be continued to develop advanced biomass
    production methods that can meet the anticipated feedstock demand. BERA
    also recommends that industry cost-shared, scale-up projects chosen by
    DOE of at least 1,000 acres in size be continued to develop large-
    scale, commercial energy plantations in which dedicated energy crops
    are grown and harvested for use as biomass resources. These projects
    should be strategically located and should utilize the advanced biomass
    production methods developed in the research programs. Successful
    completion of this work will help biomass energy attain its potential
    by providing the data and information needed to design, construct, and
    operate new biomass production systems that can supply low-cost
    feedstock for conversion to transportation fuels and electric power.
        Thermochemical Conversion.--Almost all of DOE's RD&D on liquid
    transportation fuels from biomass emphasizes fermentation ethanol.
    Thermochemical conversion research should be started that targets
    liquid motor fuel production at costs competitive with those of
    gasolines and diesel fuels in the near-to-mid term. Research on the
    thermochemical conversion of low-grade biomass for use as motor fuels
    shows great promise. Preliminary research on the non-microbial
    conversion of synthesis gas illustrates the potential of producing
    ethanol, mixed alcohols and oxygenates, ethers, and coproducts at costs
    that are much less than the corresponding costs of liquids produced by
    microbial and fermentation processes. Some analysts project that fuel
    ethanol from low-grade biomass by thermochemical processes may be able
    to attain production costs in the same range as thermochemical methanol
    from natural gas feedstocks. Each of these areas should be added to
    DOE's program.
        Regional Biomass Energy Program.--In fiscal year 2000, the RBEP
    will conduct cooperative projects with state and local governments on
    resource assessments, the selection of suitable sites for biomass-based
    transportation fuel production and distribution facilities, and multi-
    product biomass plants. Specifically, the RBEP will conduct a number of
    technology transfer activities related to the production of fuel
    ethanol from cellulosic raw materials. The activities will include
    several state-level, one-day workshops to educate stakeholders about
    fuel ethanol technologies, and the opportunities available in various
    regions to develop new fuel ethanol production capacity with low-grade
    biomass feedstocks. In conjunction with this work, the RBEP will
    complete several publications that address the educational needs
    related to the production of fuel ethanol. The RBEP will continue to
    provide national leadership in the development of biodiesel fuels with
    several engine testing programs, and will also work with the National
    Park Service to increase the use of biofuels in selected national parks
    that are encountering air quality problems.
                               hydrogen research
        Innovative research on the thermal reforming of biomass in a
    supercritical fluid reactor and in an advanced-design plasma reformer,
    and on water splitting with algae, which is the equivalent of
    photolysis, should be continued. Detailed study of each of these
    advanced conversion methods may lead to practical processes for the
    low-cost production of hydrogen.
                           integrated bioenergy rd&d
        As mentioned on page 1, all of the biomass-related RD&D funded by
    EERE and OS should be coordinated internally and jointly managed at DOE
    Headquarters. The program managers at DOE Headquarters should be
    heavily involved in this activity. The organizational phase should be
    completed as soon as possible, after which the assigned management
    responsibilities should continue. This will significantly enhance the
    value of the total program for DOE and its industrial partners and
    stakeholders.
                                     ______

                 Prepared Statement of the City of Gridley, CA
        Chairman Domenici and Ranking Member Reid: My name is Tom Sanford,
    and I am the Mayor Pro Tem of the City of Gridley, California. I also
    serve as Gridley's commissioner on the governing board of the Northern
    California Power Agency.
        Thank you for the opportunity to submit this testimony to the
    Subcommittee regarding the progress that the City of Gridley has made
    in developing a biomass facility fueled by rice straw. I want to begin
    by thanking the Subcommittee for the past support it has provided for
    the Gridley Rice Straw Project. The federal funds which have been
    provided since fiscal year 1996 have been matched dollar for dollar and
    have brought about the completion of permitting and environmental
    assessments for the site of the facility so that construction can begin
    this year.
        This will be the last time the City will request funds for
    development of this project. With this last installment of funds, the
    City will be able to secure the completion of a cost-effective,
    subsidy-independent, renewable source of liquid fuel for both
    transportation and power production purposes. In securing a final
    federal appropriation of $5 million in fiscal year 2000, the City of
    Gridley and its partners can ensure that the Gridley plant will be
    fully operational to use rice straw harvested during the year 2000.
        In the Department of Energy's fiscal year 2000 budget request,
    there is $10 million in the biomass/biofuels account to support ongoing
    projects, and the Department has indicated its support of the Gridley
    project and has indicated its intention that $5 million for the Gridley
    project be provided within this amount of funds.
        The City of Gridley, which operates its own utility, is involved in
    the development of this technology for a number of reasons. The City of
    Gridley is a rural community situated in the rice-growing region of the
    Sacramento Valley in Northern California. Our community and region are
    dependent upon an agricultural economy largely based upon rice
    production. Thousands of jobs and more than $500 million annually of
    the Sacramento Valley's economy are directly dependent upon the rice
    industry.
        The rice industry, however, is coming under tremendous pressure
    because of new mandates to reduce air pollution and end open field
    burning of rice acreage. Currently, the State of California has
    statutorily reduced the burning of rice straw. By the year 2001, the
    automatic right to burn rice straw will be eliminated. Given that there
    are insufficient cost-effective mechanisms to remove rice straw from
    the fields, we are greatly concerned that the restrictions will lead to
    a reduction in rice acreage in production. A substantial portion of the
    rice grown in the Sacramento Valley is grown on land with very heavy
    clay soil types that are suitable for very little other than rice. The
    elimination of burning as a means of dealing with the very tough rice
    straw is having significant impact upon the economics of rice growing
    in the Valley.
        Since fiscal year 1996, the Subcommittee has shown its support for
    the development of a biomass facility that will effectively utilize
    rice straw in order to produce ethanol. Unlike the facilities of the
    Midwest, the Gridley rice straw project will be able to use multiple
    feedstocks to keep the plant operating year-round. The construction of
    the Gridley plant will develop the technologies and processes necessary
    for the cost-effective use of forest and timber industry byproducts as
    well as agricultural waste products. Clearly, this plant will expand
    biomass opportunities to a broad array of industries and agricultural
    commodities, which will be beneficial to other parts of the state as
    well as other regions of the country.
        The Gridley Rice Straw Project will help the State of California
    meet the important air quality goal of ending open field burning, while
    at the same time provide rice farmers with an alternative rice disposal
    method that could generate an additional source of revenues for the
    grower. The Project will also create hundreds of direct and indirect
    jobs in Northern California communities with high levels of
    unemployment.
        I appreciate the opportunity to submit this testimony and want to
    thank the Subcommittee again on behalf of the City of Gridley and
    communities in the Sacramento Valley and Northern California for its
    support in ensuring a federal partner for the Gridley Rice Straw
    Project, thus making this project a reality in the near future.
                                     ______

       Prepared Statement of Prof. David K. Wehe, University of Michigan
        The U.S. Department of Energy (DOE) has provided support to the DOE
    University Research Program in Robotics to pursue long range research
    leading to the: ``development and deployment of advanced robotic
    systems capable of reducing human exposure to hazardous environments,
    and of performing a broad spectrum of tasks more efficiently and
    effectively than utilizing humans.''
        The DOE University Research Program in Robotics (URPR) has proven
    highly effective in technology innovation, education, and DOE mission
    support. The URPR incorporates mission-oriented university research
    into DOE EM's Office of Science and Technology (OST) and, through close
    collaboration with the DOE national laboratories, provides an avenue
    for applying innovative solutions to problems of vital importance to
    DOE.
        The URPR would like to thank the Committee members for their
    historically strong support of this successful program and is pleased
    that the URPR is included in the DOE Budget Request for fiscal year
    2000 at $4.0M. The URPR is requesting the Committee consider augmenting
    this amount to $4.35M to compensate for DOE's expansion of the
    Consortium to include the University of New Mexico.
                           request for the committee
        We request the Committee include explicit language directing $4.35M
    of ER&WM (EM-50) research funds to the University Research Program in
    Robotics (URPR) for development of safer, less expensive, and more
    effective robotic technology for environmental restoration and waste
    management solutions.
              developing advanced robotics for doe and the nation
    Develop robotic solutions for work in hazardous environments and
            facilitate cleanup operations
        The goal of this program is to advance and utilize state-of-the-art
    robotic technology in order to remove humans from potentially hazardous
    environments and expedite remediation efforts now considered essential.
    Established by DOE in fiscal year 1987 to support advanced nuclear
    reactor concepts, the project was relocated to EM to support higher
    priority needs in environmental restoration. The project has produced
    an impressive array of technological innovations which have been
    incorporated into robotic solutions being employed across federal and
    commercial sectors. This successful program demonstrates efficient
    technology innovation while educating tomorrow's technologists,
    inventing our country's intelligent machine systems technology of the
    next century, and meeting today's technology needs for DOE.
    Robotics: A Strategic National Technology
        R&D funding is the most effective use of federal funds to promote
    the nation's well-being according to a 1997 published poll of respected
    academic economists. And, as documented in previous testimonies, key
    national studies (by the Council on Competitiveness, DOD, and former
    OTA technology assessment reports) consistently list robotics and
    advanced manufacturing among the five most vital strategic technologies
    for government support. During the past year, reports from NSF, the
    OSTP report on critical technologies, and the report from the
    President's Advisory Committee on Information Technology suggests that
    the areas of greatest concern to the nation are: the economy,
    education, health care, and the environment. The URPR is making
    technology contributions affecting each of these key areas.
    Furthermore, the reports note key technology areas include information
    technology and nanotechnology, and key enabling technologies include
    manufacturing and materials. The URPR actively participates in
    advancing these fields. The national need for an investment in the
    development of intelligent machines which can interact with their
    environment has been universally recognized for over a decade.
    Intelligent Machines: Grand Challenge for the Next Millennium
        Significant advances in computing power, sensor development and
    platform architectures (e.g., unmanned airborne vehicles) have opened
    new opportunities in intelligent machine technology. The long-range
    implications of intelligent mobile and dextrous machines which can
    assist humans to perform life tasks are clearly significant and
    represent one of technology's Grand Challenges for the next millennium.
    We can expect to see intelligent prosthetic devices, smart transport
    vehicles, and mobile devices capable of assisting or replacing the
    human, not only in potentially hazardous situations, but in daily life.
              urpr: innovation, education, and doe mission support
    URPR: Refining the Right Paradigm
        The URPR instantiates the new paradigm recommended for Federal
    investment in national S&T by the National Science Board (3/6/98) that
    emphasizes the integration of long-range research and education. The
    URPR's strategic mission is to make significant advances in our
    nation's intelligent machine and manufacturing technology base while
    emphasizing: education, technology innovation through basic R&D, and
    DOE mission support. Furthermore, the Consortium of Universities
    (Universities of Florida, Michigan, Tennessee, Texas, and New Mexico)
    are united as a powerful technology team, governed by a national Board
    of Directors, advised by a Technical Advisory Committee, and managed by
    a group of DOE and national laboratory officials. During fiscal year
    1999, the Consortium has worked through 8-10 levels of DOE bureaucratic
    control, an unfortunate side effect of the current DOE structure which
    governs the URPR. It is only because of the Committee's explicit
    appropriations language that any funding has managed to pass through
    this system.
        The URPR has demonstrated in earlier years that the advantages of
    operating as a consortium are significant. The institutions of the URPR
    partitioned the technical development into manageable sections which
    allowed each to concentrate within their area of expertise (efficiently
    maintaining world-class levels of excellence) while relying on their
    partners to supply supporting concentrations. With full cooperation of
    the host universities, this effort naturally generated the in-depth
    human and equipment capital required by the EM community. Practically,
    the long-term distributed interaction and planning among these
    universities in concert with the DOE labs and associated industry
    allows for effective technology development (with software and
    equipment compatibility and portability), for a vigorous and full
    response to application requirements (component technologies, system
    technologies, deployment issues, etc.), and for the supported
    application of the technology. Considering the remarkable achievements
    of URPR over its history and the enlightened commitment of EM-50 to
    this technology development, the URPR is now poised to enhance its
    prominent role in education, technology innovation, and DOE mission
    support.
    Educating the New Millenium's Technologists
        The URPR has already educated about 450 advanced degree students in
    the critical engineering fields, including many with earned doctoral
    degrees. These students have entered the work force, and lead an
    industrial resurgence based on intelligent machines, advanced
    manufacturing technology, and related fields. Graduates from this
    project have built successful startup companies and made industrial
    technology transfers in computer vision and robotic technology (MI, TN,
    TX) and medical imaging (MI), video databases (CA), and intelligent
    manufacturing (MI, FL, TX). We have historically seen a strong demand
    for graduates educated through this project, even during the leanest of
    times.
    DOE Mission Contribution--Environmental Cleanup
        Since its inception, EM has recognized robotics as an essential
    technology to accomplish its mission. The motives for undertaking a
    comprehensive R&D effort in the application of advanced robotics to EM
    tasks in hazardous environments reflect both economic considerations,
    efficiency, effectiveness, and health and safety concerns. The RBX is a
    national laboratory program which primarily applies commercially
    available technology to current problems. In contrast, the URPR
    supports needs-driven applied research to develop innovative and
    synergistic technologies in support of EM focus areas.
        URPR progress is annually evaluated by a thorough review of
    technical accomplishments, and then anticipated DOE technology needs
    are used to set the program's directions. The URPR has consistently
    received high rankings for providing both outstanding technical
    contributions and value. Future success of this program is expected to
    continue based upon the Consortium's productive history.
        Over the past few years, the URPR projects successfully supported
    the following EM projects:
        1. deployment and testing of SWAMI, an autonomous inspection robot
    for Fernald stored waste drums;
        2. design, construction and testing of a robot to precisely map
    large DOE facilities, such as K-25 and K-27 in Oak Ridge, in
    preparation for decontamination and decommissioning (D&D);
        3. delivery of a robotic handling system for an automated chemical
    and radiological analysis system to Los Alamos;
        4. remote radiation mapping of the MSRE facility at ORNL during D&D
    operations;
        5. design and implementation of a real-time controller for use at
    Hanford in support of the tank waste retrieval project; and
        6. design and fabrication of a prototype Soil Sample Preparation
    Module in support of the Contaminant Analysis Automation project.
        During fiscal year 1999, the URPR achievements have included:
      --1998 Discover Magazine Award for Technological Innovation:
            Robotics. Personally presented by the Secretary of Energy.
      --Invention of the room-temperature semiconductor radiation sensor
            that holds the world's record for energy resolution.
      --Development of a mutisensor visualization platform to aid operators
            during D&D operations.
      --Transfer of an inductive, radiation-resistant, high resolution
            position sensor to a commercial vendor.
      --Development of a system to reduce the time between a site-defined
            need and a site-delivered implementation of the robotic and/or
            automation hardware using simulation of components.
      --Codified algorithms for assembly of standardized modules to produce
            the complex manipulators needed for a wide range of hazardous
            tasks.
        As shown above, these efforts are directly linked to cleanup
    operations in the DOE complex. During fiscal year 2000, the URPR plans
    to continue its focussed efforts on DOE field cleanup applications,
    while maintaining our commitment to research and education.
    Innovation--the seed of future technology
        The URPR has produced prodigious levels of innovation in research
    and development. While recent demonstrations reveal next-generation
    technologies, even more advanced capabilities are emerging from the
    laboratories. These include new types of locomotion, navigation
    techniques, sensing modalities (radiation cameras and laser imaging
    devices), environmentally hardened components, and dextrous open
    architecture manipulators. These devices will evolve and inspire the
    intelligent machines of the future, including smart automobiles,
    obstacle avoidance aids for the disabled, and agile manufacturing cells
    capable of being rapidly reconfigured.
        This level of innovation can also be seen in the following
    statistics:
      --Approximately 15 patents awarded or pending.
      --Over 700 technical papers published in technical journals and
            conferences.
      --The standard technical books for vision, radiation detection and
            imaging, and robotics are authored by researchers who have
            worked with this project. Faculty and senior scientists
            dedicated to this project are internationally renowned
            technologists of their fields.
      --A suite of world-class robots (including CARMEL, winner of the AAAI
            Mobile Robot Competition) serve as the research testbeds for
            this project.
                                program request
        During fiscal year 1999, the URPR provided vital contributions to
    education and research while meeting DOE technology needs. The
    motivation for this project remains steadfast--removing humans from
    hazardous environments while enhancing safety, reducing costs, and
    increasing cleanup task productivity. EM-50 has recognized the URPR's
    role and mission and has requested $4M for the URPR in fiscal year
    2000. We are requesting an additional $350K to fund the University of
    New Mexico, added by DOE to the Consortium in fiscal year 1998, at a
    level comparable to the other consortium members.
                           request for the committee
        To continue this vital program, we request that the Committee
    include the following language into the fiscal year 2000 Energy and
    Water Appropriations Bill: For development of safer, less expensive,
    and more effective robotic technology for environmental restoration and
    waste management solutions, $4.35M of ER&WM (EM-50) funds are provided
    to the University Research Program in Robotics (URPR).
                                     ______

                Prepared Statement of The REPI Action Coalition
        The undersigned members of the REPI Action Coalition request that
    the Renewable Energy Production Incentive (REPI) program be funded at a
    level sufficient to cover payments for eligible projects. $20 million
    is needed in fiscal year 2000 to make full incentive payments for
    electricity produced by all qualified facilities through the end of
    fiscal year 1999. The current funding level of $4 million provides full
    incentive payments for only a few projects and insufficient revenues
    for the majority of projects.
        Our coalition, which represents the interests of national consumer,
    business, environmental, energy and industry organizations, is
    incredulous that the Administration's fiscal year 2000 Budget Request
    of $1.5 million for REPI represents a 62.5 percent reduction from the
    existing funding level. At this level, most projects eligible for REPI
    funding--including projects receiving funds in the prior fiscal year--
    will not receive payments. This will cause irreparable damage to the
    incentive value of a program designed to encourage public power to
    reduce greenhouse gas emissions through a variety of projects including
    landfill gas-to-energy projects.
        Created by the Energy Policy Act of 1992, REPI authorizes the
    Department of Energy to make payments of 1.5 cents per kWh of energy
    produced from eligible renewable energy sources to consumer-owned
    electric utilities. Unlike the tax credits awarded to investor-owned
    utilities, the public power REPI program is inherently uncertain
    because payments are dependent on the availability of annual
    appropriations. In funding shortfall years, projects in Tier 1 (solar,
    wind, geothermal and closed-loop biomass) are granted full payments.
    Inadequate leftover revenues are then dispersed on a pro rata basis to
    Tier 2 (landfill gas-to-energy) projects. Electricity for which payment
    is not made may then be added to the next fiscal year's electricity
    production and submitted by the qualifying facility for payment
    consideration.
        Congress established REPI in large part to provide benefits
    commensurate with those available to investor-owned utilities through
    the renewable electricity production tax credit in Section 45 and the
    investment tax credit in Section 48 of the Internal Revenue Code. In
    the years since REPI incentives have been in place, private entities
    have enjoyed full access to their economic incentives while consumer-
    owned electric utilities have received only partial appropriations
    since 1996.
        Since the program's inception, nearly $8.4 million in incentive
    payments have been made to the owners of qualifying facilities. The
    number of projects receiving REPI awards has increased from 6 projects
    in 1995 producing 43 million kWh of electricity to 16 projects in 1998
    producing 549 million kWh of electricity. Due to inadequate
    appropriations, full payments for all eligible projects were last made
    in 1996. Every year since then, the majority of eligible projects have
    received only partial payment. Projects most impacted by the funding
    deficit have been landfill gas-to-energy projects.
        Despite this shortcoming, REPI is the most significant incentive
    available to locally owned, not-for-profit electric utilities to make
    new investments in renewable energy projects. These projects provide
    important economic and environmental benefits to the communities served
    by the municipal utility. Along with significant air quality benefits
    resulting from the accelerated use of emissions-free energy sources,
    new jobs are created each time these technologies are deployed.
        An important and unique feature of the REPI program is its
    potential to assist municipalities, and the communities they serve, in
    reducing significant levels of greenhouse gases (ghg) through landfill
    gas-to-energy projects. Landfill gas is about 50 percent methane and
    methane is a potent ghg that is over 20 times more potent than carbon
    dioxide in contributing to climate change. There is potential to reduce
    over 2.3 million metric tons of carbon equivalent of ghg by deploying
    these projects on existing untapped landfills. The comparative
    economics of landfill-gas projects makes these facilities one of the
    most promising near-term renewable resources.
        Despite the funding shortfalls and the volatility of the
    appropriations process, REPI is considered a true incentive among
    potential project owners. For example, a feasibility study for the
    construction of a municipally-owned wind farm in Iowa showed that REPI
    assistance made an impressive difference in the cost of the project.
        The REPI program increases in importance as new air quality
    regulations and renewable energy mandates are imposed. Public power
    systems will be at a disadvantage under the currently structured REPI
    if renewable portfolio standards are included in electricity
    restructuring proposals. Unlike the certainty of the tax credits and
    incentives available to private entities, REPI funding is erratic and
    insufficient to offset the higher costs of using alternative energy
    resources.
        In conclusion, REPI is an important tool in promoting renewable
    energy resources by consumer-owned utilities which could be greatly
    improved by program reform that addresses insufficient and uncertain
    appropriations. We strongly encourage your help this year in saving
    REPI by agreeing to restore funds at a level sufficient to cover on-
    going and future payments.
        Thank you.
                        The American Public Power Association, The Large
                                Public Power Council, City of Glendale,
                                California, PACE Energy Project, Minnesota
                                Municipal Utility Association, SUN DAY
                                Campaign, American Wind Energy Association,
                                Omaha Public Power District, American
                                Bioenergy Association, Klickitat Public
                                Utility District (Washington), Los Angeles
                                Department of Water & Power, Global Bio
                                Refineries Inc., University of California,
                                Los Angeles, American Green Network,
                                Business Council for Sustainable Energy,
                                Solar Energy Industries Association, Bio
                                Energy Industries Association, Bob Lawrence
                                & Associates, Public Citizen, Monterey
                                Regional Waste Management District
                                (California), Solid Waste Association of
                                North America, Board of Public Works, City
                                of Auburn, Nebraska, Salt River Project
                                (Arizona), Union of Concerned Scientists,
                                Lincoln Electric Service (Nebraska),
                                Friends of the Earth, Pacific Northwest
                                Generating Cooperative, City of
                                Tallahassee, Florida, Clean Fuels
                                Foundation, American Solar Energy Society,
                                International Brotherhood of Electrical
                                Workers, Emerald Peoples' Utility District
                                (Oregon), Austin Energy (Texas), Waverly
                                Light and Power (Iowa), Nebraska Public
                                Power District, Environmental and Energy
                                Study Institute, New York Power Authority,
                                JEA (Florida), Moorhead Public Service
                                (MN), Geothermal Energy Association,
                                Lycoming County Resource Management
                                Services (PA), Potomac Resources, Windrush,
                                Inc., Consumer Federation of America, City
                                of Seattle, Traverse City Light & Power
                                Department (Michigan), Michigan Public
                                Power Agency, and Michigan Municipal
                                Electric Association.
                                     ______

          Prepared Statement of the American Public Power Association
        The American Public Power Association (APPA) is the national
    service organization representing the interests of over 2,000 municipal
    and other state and locally owned utilities throughout the United
    States. Collectively, public power utilities deliver electric energy to
    one of every seven U.S. electric consumers (about 40 million people),
    serving some of the nation's largest cities. The majority of APPA's
    member systems are located in small and medium-sized communities in
    every state except Hawaii.
        We appreciate the opportunity to submit this testimony outlining
    our fiscal year 2000 appropriations priorities within your
    Subcommittee's jurisdiction.
                           renewable energy programs
        APPA believes it is important to continue development and
    commercialization of clean, renewable energy resources as we face the
    prospect of increased competition in the electricity marketplace. Two
    of the most significant barriers to greater renewable energy use are
    cost and lack of demonstrated experience. Because of the requirement to
    supply electricity to customers on demand, with high reliability at a
    reasonable cost, electric utilities often are conservative when
    evaluating new technologies. Evolving deregulation, coupled with stable
    fuel prices, now adds a further challenge to greater adoption of
    relatively unproved renewable technologies.
        We applaud the Administration's emphasis on DOE energy efficiency
    and renewable programs and ask that this Subcommittee work to ensure
    that renewable energy remains part of the full range of resource
    options available to our nation's electric utilities. APPA supports a
    minimum of $399 million for renewable energy technologies in fiscal
    year 2000. This funding level will go a long way in furthering the call
    for significant expansion of renewable energy R&D programs in order to
    meet the energy challenges and opportunities of the 21st century.
              renewable energy production incentive program (repi)
        APPA urges this subcommittee's continued support for REPI, the
    renewable energy production incentive program authorized by the Energy
    Policy Act of 1992. Current funding is $4 million, but according to
    DOE's Golden Fields Laboratory estimates, which are based on incentive
    payments requested from qualified facilities, $20 million is needed to
    fully fund all eligible projects. At a funding level of $20 million,
    REPI will help the nation's locally owned, not-for-profit electric
    utilities spur renewable energy use and development. This benefits the
    environment because of the greater use of emissions-free energy
    sources, and the economy because of the job creation potential that is
    tied to the deployment of new technologies.
        REPI permits DOE to make direct payments to publicly owned electric
    utilities at the rate of up to 1.5 cents/kWh of electricity generated
    from solar, wind, certain geothermal and biomass electric projects.
    Because projects of this nature often require a long lead-time for
    planning and construction, it is imperative that stable and predictable
    funding be provided.
        REPI was established to ensure equity between investor-owned
    utilities that utilize renewable energy tax credit and production
    payments and not for profit electric utilities that are unable to do
    so. Several electric utility restructuring bills introduced in the
    105th Congress, and bills in state legislatures, mandate use of
    renewable energy sources. REPI payments provide the singular financial
    incentive for publicly owned utilities to meet these increasing
    demands. In addition, production payments to utilities are an excellent
    market-based method to spur greater interest in renewables. They fit
    well with DOE's emphasis on market-led commercialization. APPA urges
    this subcommittee's support of REPI at $20 million to fully fund all
    eligible projects.
                      storage for high-level nuclear waste
        We support the Administration's budget request of $409 million for
    DOE's Office of Civilian Radioactive Waste Management. These funds will
    enable DOE to continue preparations to accept spent fuel as well as to
    continue scientific studies at Yucca Mountain leading to a second
    viability assessment to compliment the completion of the first
    assessment in late1998.
                      advanced hydropower turbine program
        The Advanced Hydropower Turbine Program is a joint industry/
    government cost-share effort to develop a new, improved hydroelectric
    turbine superior in its ability to protect fish and aquatic habitat and
    operate efficiently over a wide range of flow levels. We support
    funding this program at $7 million in fiscal year 2000.
        During the next 15 years, 220 hydroelectric projects will seek new
    licenses from the Federal Energy Regulatory Commission (FERC). Publicly
    owned projects constitute 50 percent of the total capacity that will be
    up for renewal. Many of these projects were originally licensed over 50
    years ago. Newly imposed licensing conditions can cost hydro project
    owners 10 to 15 percent of power generation. A new, improved turbine
    could help assure any environmental conditions imposed at relicensing
    in the form of new conditioning, fish passages or reduced flows are not
    accomplished at the expense of energy production. This is particularly
    important due to the increasingly competitive electric market in which
    utilities operate today. Flow levels will affect the economics of each
    of these projects and many will be unable to compete if the current
    trend toward flow reductions continues.
        The Advanced Hydropower Turbine Program is planned in three phases:
    (1) design development; (2) model design and testing, and (3)
    development of the final prototype. It is important that the prototype
    be in place in order to accommodate the many hydroelectric projects
    that will be up for relicensing after the year 2000.
                 federal power marketing administrations (pmas)
        APPA has consistently supported increased efficiency in PMA
    operations. However, Congress must recognize that federal power sales
    revenues cover all PMA operating expenses plus all Corps of Engineers
    and Bureau of Reclamation operations, maintenance, replacement and
    rehabilitation expenses for hydropower, and repayment of the federal
    investment in the construction of the projects plus interest. Power
    sales also support many nonpower-related expenses associated with these
    projects. Budget ``scoring'' rules aside, because the PMAs charge cost-
    based rates, reducing discretionary appropriations to PMAs actually
    costs the government nothing. As appropriations are lowered, power
    rates fall accordingly thus reducing mandatory receipts on the other
    side of the ledger. APPA urges members of the subcommittee to reassess
    the Department of Energy's policy change whereby the federal power
    marketing administrations would no longer purchase power. Customers of
    three of the federal power marketing administrations would have to make
    there own power purchase and transmission agreements directly with
    suppliers. It is essential that the PMAs be able to purchase power
    because it is used to firm up their hydro capacity, allowing them to
    meet their contractual agreements.
                  corps of engineers and bureau of reclamation
        APPA supports the Administration's fiscal year 2000 Budget Request
    of $4,293 million for the Corp of Engineers and $857 million for the
    Bureau of Reclamation.
        More than 500 public power systems purchase power generated at U.S.
    Army Corps of Engineers and Bureau of Reclamation dams and marketed by
    the four PMAs. APPA asks this subcommittee's support in assuring
    adequate appropriations are provided to the Corps and Bureau for
    operation, maintenance, major rehabilitation, upgrading and replacement
    of the equipment needed at the powerhouses. The Administration has
    requested reductions in several of these accounts for fiscal year 1999.
    Unfortunately, budget realities in the past often have required the
    Corps and Bureau to defer upgrades and maintenance resulting in
    efficiency losses affecting hydropower production.
        Discussions are continuing in various project areas between
    customers and the operating agencies seeking alternatives to relieve
    the stress caused by the spiraling effects of deferred maintenance. We
    will keep this subcommittee apprised of our progress in this regard and
    look forward to working with you and the authorizing committees in
    seeking remedies to increase efficiencies and deal with ongoing
    maintenance problems.
                  federal energy regulatory commission (ferc)
        APPA supports the Administration's budget request of $180 million
    in fiscal year 2000 for the Federal Energy Regulatory Commission
    (FERC), an increase of nearly eight-percent over last year. Adequate
    funding for the agency is particularly necessary at this time in order
    to provide the resources needed to continue implementation of electric
    utility industry restructuring and to address major issues such as
    open-access and stranded costs.
        The FERC is charged with regulating certain interstate aspects of
    the natural gas, oil pipeline, hydropower, and electric industries.
    Such regulation includes issuing licenses and certificates for
    construction of facilities, approving rates, inspecting dams,
    implementing compliance and enforcement activities, and providing other
    services to regulated businesses. These businesses will pay fees and
    charges sufficient to recover the Government's full cost of operations.
                            climate change programs
        APPA generally supports the fiscal year 2000 Budget Request of $4
    million to fund the Climate Change Technology Initiative. The
    initiative consists of a package of tax incentives and investments in
    research and development to stimulate increased energy efficiency and
    to encourage greater use of renewable energy sources. APPA is an
    aggressive advocate of federal support for energy research and
    development. While these programs do not directly provide benefits or
    incentives to public power systems, APPA supports them nevertheless
    because they will result in substantial improvements to the
    environment.
        U.S. DOE programs under the Climate Change Initiative include a mix
    of tax credits and federal-spending programs designed to increase
    efficiency and greater use of renewable energy resources. Important
    elements of the initiative include support for the deployment of clean
    technologies for buildings, transportation industry and electricity.
    The request includes $122 million for DOE research on next-generation
    coal combustion technologies, including integrated gasification
    combined cycle and pressurized fluidized bed combustion.
                                     ______

      Prepared Statement of Dwane Milnes, Executive Director, San Joaquin
    Area Flood Control Agency and City Manager City of Stockton, California
     subject: san joaquin river basin, stockton metropolitan area (section
    211) increase fiscal year 2000 president's coe budget from $200,000 to
     $380,000 and include $10 million of the expected $45 million federal
                                 reimbursement
        Mr. Chairman and Members of the Subcommittee: My name is Dwane
    Milnes, Executive Director of the San Joaquin Area Flood Control Agency
    and the City Manager of the City of Stockton, California, located forty
    five miles south of Sacramento. Thank you for the opportunity to
    present testimony for the fiscal year 2000 budget for the U.S. Army
    Corps of Engineers.
        The San Joaquin Area Flood Control Agency (SJAFCA) is a Joint
    Powers Authority (JPA) of the City of Stockton, California and San
    Joaquin County. SJAFCA was created to finance, design and construct a
    $70 million dollar Flood Protection Restoration Project (FPRP). The
    FPRP provides a 100 year level of flood protection for the City of
    Stockton and surrounding areas of San Joaquin County. The project was
    undertaken in response to a Federal Emergency Management Agency (FEMA)
    restudy of the area which identified a large new floodplain. The FPRP
    protects a population of approximately 300,000 and removed severe
    economic impacts to the region associated with floodplain designation
    by FEMA. Construction of the FPRP was completed in November 1998.
        The Corps of Engineers (COE) completed a Reconnaissance study of
    the project area in 1997 and found a Federal interest. The COE is
    continuing with a Federal study to establish the amount of Federal
    reimbursement for the FPRP provided for in Section 211 of the Water
    Resource Development Act of 1996 (WRDA 96) as one of eight specifically
    named demonstration projects and a Feasibility Study to identify any
    additional flood protection improvements. The COE report is scheduled
    for completion in 1999.
        The FPRP was initially financed completely with local funds
    collected through the formation of an assessment district. The
    assessment district provided $70 million dollars and was financed
    through the sale of bonds. Annual interest payments on the outstanding
    bonds are approximately $2.5 million. Therefore, it is important to
    receive Federal reimbursement as soon as possible so that these
    interest costs will cease. It should be noted that SJAFCA has already
    received reimbursement from the State of California in the amount of
    $12.6 million as the estimated state share of the FPRP costs.
        The fiscal year 2000 President's Budget is currently programmed to
    fund the current companion COE studies (San Joaquin River Basin,
    Stockton Metropolitan Area (Section 211) for $200,000. The COE has a
    capability of performing $380,000 of work on these studies. Therefore,
    we are requesting an increase of $180,000 so that the COE can fully
    staff both studies and accomplish them on the current schedule. In
    anticipation of this report we also request that at least $10 million
    dollars of the expected $45 million of Federal reimbursement be
    included in fiscal year 2000 budget.
                                     ______

         Prepared Statement of the Sacramento Area Flood Control Agency
        Dear Mr. Chairman and Members of the Subcommittee: We appreciate
    the opportunity to provide testimony to this Subcommittee, and extend
    our sincere appreciation for your past support of this community's
    efforts to protect the citizens and properties in the capital city of
    California. In our continuing efforts to protect the Sacramento
    metropolitan area, the Sacramento Area Flood Control Agency (SAFCA),
    and its member agencies, support the following Federal appropriations
    for fiscal year 2000:

                                                  [Millions of dollars]
    ----------------------------------------------------------------------------------------------------------------
                   Project                        Funding type          President's budget     Recommended funding
    ----------------------------------------------------------------------------------------------------------------
    American River--Common Elements......  Construction.............  17.0.................  17.0
    American River--Comprehensive Plan...  PED......................  5.0..................  5.0
    American River-North Area Project....  Construction.............  4.0..................  4.0
                                           (Reimbursement)
    Sacramento River Bank Protection.....  Construction.............  7.0..................  7.0
    South Sacramento Streams Group.......  Construction.............  0.5..................  4.0 Construction \1\
    Section 205 Continuing Authorities     Construction.............  26.9.................  Support
     (Magpie  Creek).                                                 (Total Program)
    Lower Strong & Chicken Ranch Sloughs   Feasibility Study........  0.5..................  0.5
    Ueda Parkway Recreational              Construction.............  .....................  Support City of
     Improvements.                                                                            Sacramento
    ----------------------------------------------------------------------------------------------------------------
    \1\ Construction funds in fiscal year 2000 contingent upon authorization in 1999 WRDA.

        Sacramento has the dubious distinction of being the urban area with
    the worst flood risk in the nation according to the U.S. Army Corps of
    Engineers. Addressing this problem is our region's most critical
    infrastructure issue as evidenced by the formation of a joint powers
    agency, the Sacramento Area Flood Control Agency (SAFCA) to solve the
    problem and the millions of dollars spent over the past ten years on
    improvements and countless engineering studies. A major flood on the
    American River, would cause between $7 and $16 billion in damage and
    likely result in lives being lost. The floodplain is home to over
    400,000 residents, 150,000 homes, 5,000 businesses, the State Capitol,
    and 1,300 government facilities.
        Sacramento's existing level of flood protection has been a moving
    target over the past year. Quantifying flood risk has been difficult
    for engineers to explain, frustrating for policy makers who must make
    decisions and virtually impossible for the general public to
    understand. However, all interests from engineers to environmentalists;
    corporations to small businesses; community activists to the local
    homeowner all agree Sacramento needs more flood protection and we need
    it now. The five largest floods on the American river this century have
    all occurred after 1950, including the two largest floods within the
    last eleven years (1986 and 1997). It is unclear if this signals a
    shift in our meteorologic climate, but it is clear the flood risk is
    much greater than was thought 50 years ago when the original flood
    control system was built. In fact, our existing system of Folsom Dam
    and the downstream levees, which was designed to protect Sacramento
    from a 250-300 year flood, now provides less than 100-year flood
    protection. This means there is a 25 to 30 percent chance over the next
    30 years of having the worst flood disaster in this nation's history
    occur in Sacramento.
        Sacramento has not been sitting idly since our near disaster in
    1986. Over $80 million in local funds have been spent on flood control
    improvements, engineering studies, public education and other
    activities to further our region's flood control objectives. We have
    been a very pro-active and innovative community. Accomplishments to
    date include strengthening levees along the Sacramento River; raising
    and constructing new levees in North Sacramento and Natomas; raising
    levees protecting the Regional Wastewater Treatment Plant; negotiating
    an agreement for more flood space at Folsom; restoring bank erosion
    sites along the Lower American River; and development of a flood
    management plan including evacuation plans and development guidelines.
    The flood control improvements to our system played an important role
    in avoiding the devastating flood damages experienced by our neighbors
    to the north and south during the past few years. In addition, we have
    systematically re-evaluated the flood control system protecting this
    region and identified the projects necessary to significantly reduce
    our chances of a catastrophic flood. In order to advance these efforts,
    SAFCA supports fiscal year 2000 Federal appropriations for the
    following flood control projects in the metropolitan Sacramento area.
                             american river project
        When Folsom Dam was completed along the American River in 1955,
    Sacramento was thought to have a very high level of flood protection
    (250 to 300-year) consistent with other urban areas in the nation.
    However, as described above, the five largest floods of this century on
    the American River have all occurred in the last 50 years which has led
    to a reduction in our credited flood protection to less than 100-year.
    This is significantly less than the authorized project in the 1950's
    and substantially less than other similarly situated major urban areas
    around the nation including St. Louis, Kansas City, Dallas, Omaha,
    Minneapolis, and Pittsburgh.
        Following an exhaustive feasibility study by the Corps looking at
    all the flood control alternatives, Sacramento unsuccessfully sought
    Congressional authorization of a comprehensive flood control project on
    the American River in 1992, 1996, and again in 1998. Sacramento is
    continuing efforts to gain authorization of a project as part of a 1999
    WRDA. As part of the fiscal year 2000 Federal budget, we are seeking
    $5.0 million to move forward with Preconstruction, Engineering and
    Design of the one flood control improvement all parties to the debate
    support which is increasing the outlet capacity of Folsom Dam. The
    funds requested would also allow the Corps to provide more detailed
    information about flood control options in the event Congress fails to
    enact authorizing legislation this year.
        Common Elements.--As part of the 1996 WRDA, Congress authorized
    flood control features which were common to all the long term
    alternatives being considered for Sacramento. These included 26 miles
    of levee stabilization along the lower American River, raising and
    strengthening 12 miles of the east levee of the Sacramento River south
    from the Natomas Cross Canal, three new telemetered gauges and other
    early flood warning improvements along the American River. As the
    recent floods in Northern California have demonstrated, we must
    continue to rehabilitate our existing system of levees to carry even
    their intended design flows. The levee modifications authorized under
    this project complement work done by the Corps in the early 1990's
    along the Sacramento River and will complete the job of stabilizing the
    existing levees protecting this community. The first contract was
    awarded on this project in 1998 to complete a two-mile stretch of the
    American River north levee. The Corps has an ambitious schedule to push
    forward with this project in 1999 and will require continuing
    appropriations in fiscal year 2000 so as not to delay the project. We
    support the Administration's budget request of $17.0 million in fiscal
    year 2000 to allow completion of the project on an efficient
    construction schedule and request this Committee's support.
        North Area (Natomas) Levee Improvements.--In 1992, the recommended
    plan for the American River was construction of a flood detention dam
    at Auburn and levee improvements around Natomas and lower Dry and
    Arcade Creeks. Congress did not include this project in the WRDA for
    that year, but in subsequent legislation did authorize the levee
    improvements around the Natomas basin and North Sacramento. The
    authorizing legislation included provisions to reimburse the local
    agency for constructing levee improvements which were consistent with
    the Federal project. With over 75,000 residents at risk, subject to
    life threatening flood depths of 20 feet in some areas, SAFCA decided
    to initiate construction of the project using local funds with the
    potential for future Federal reimbursement. By borrowing heavily from
    other sources and debt financing through a capital assessment district,
    SAFCA proceeded with construction of the authorized project and has
    rapidly completed $60 million in flood control improvements. These
    improvements were instrumental in preventing flooding in recent years.
    However, the borrowing of funds, coupled with additional future flood
    control obligations, has severely strained SAFCA's financing capability
    to the point we are now seeking reimbursement as provided under the
    authorizing legislation. The Assistant Secretary of the Army has
    directed the Corps to negotiate and execute a crediting/reimbursement
    agreement with SAFCA. This agreement, which will be ready for execution
    later this year, provide's the basis for reimbursement of not less than
    $21 million agreed to by the Corps, and a future reimbursement as
    appropriate based on the final cost accounting for the project and
    further negotiations with the Corps. Congress included $9 million in
    fiscal year 1998 and $10 million in fiscal year 1999 which the Corps
    indicates is available to reimburse SAFCA once the agreement is
    executed. SAFCA supports the President's request of $4.0 million in
    fiscal year 2000. Two million completes the Federal share for the
    initial $21 million reimbursement the other $2.0 million is for
    additional constructed features, which SAFCA believes are consistent
    with the authorized project, and are the subject of future negotiations
    with the Corps. These funds can be used to stabilize SAFCA's financing
    capability so that additional flood control improvements could be
    planned and constructed.
        In addition, SAFCA supports the City of Sacramento's efforts to
    obtain construction funds for implementation of the recreational
    improvements along the City's Ueda Parkway which were included as part
    of the federally authorized project described above. The recreational
    components are an integral part of creating a parkway which serves both
    as an open space corridor and a floodway. By maintaining the open
    space, we can insure channel capacity is maintained in the future.
           sacramento bank protection project (american river levees)
        SAFCA, the State of California and the Corps have found that bank
    protection improvements are needed to stop erosion which threatens
    urban levees along the lower American River. Over the last four years
    SAFCA has led a collaborative process through which flood control,
    environmental and neighborhood interests have reached agreement on how
    to complete this work in a manner which protects the sensitive
    environmental and aesthetic values of the American River in addition to
    improving the reliability of the levee system. As a result, a bank
    protection program to be implemented over the next several years has
    been established to address the most critical reaches of the river
    system. Construction on this project commenced in 1996. The President's
    proposed budget includes $7.0 million in Construction funds for several
    American River sites in fiscal year 2000. SAFCA supports this funding
    which provides for an efficient construction schedule on the lower
    American River sites.
                        south sacramento streams project
        In 1995, homes in the South Sacramento area were threatened by rain
    swollen creeks which reached to within a foot, and in some areas less,
    of overtopping the levees and channels and flooding adjacent
    residential subdivisions. The recently completed Feasibility Study by
    the Corps shows much of the urban area of South Sacramento has less
    than 50-year flood protection from these urban streams. There are over
    100,000 people and 41,000 structures in the floodplain of Morrison,
    Unionhouse, Florin and Elder Creeks which make up the study area.
    Because of the significant flood risk, SAFCA constructed a portion of
    the levee improvements using local funds in 1996 under the U.S. Army
    Corps of Engineers Section 104 crediting provisions. In its Chief's
    Report, the Corps has recommended an NED project which provides the
    entire area with a consistent 500-year level of flood protection. We
    are seeking authorization of this project as part of the 1999 WRDA. We
    therefore request your committee's support for $4.0 million in new
    start Construction in fiscal year 2000 contingent upon obtaining
    Congressional authorization. The Corps has indicated they are on
    schedule to deliver the first construction contract in early 2000 and
    would have a capability of spending at least $4.0 million on
    construction during that fiscal year. If funding is not provided,
    construction would be unnecessarily delayed for a year. The President's
    proposed budget includes only $500,000 to complete PED which would
    appropriate if there was not WRDA until 2000.
           magpie creek (section 205 continuing authorities program)
        The Magpie Creek Diversion Project, constructed by the Corps in the
    1950's as an extension of the Sacramento River Flood Control Project,
    is inadequate for even the 100-year flood event using new hydrologic
    data. The resulting floodplain encompasses residential and commercial
    developments downstream and would close Interstate 80, the major east-
    west transportation route through Sacramento. These improvements have a
    benefit to cost ratio of 2.5 to 1 and not only protect existing urban
    development but are essential to provide capacity for future
    improvements on McClellen Air Force Base to allow for orderly
    redevelopment activities as part of the base conversion process.
    Congress earmarked funds in last year's Energy and Water Appropriations
    bill to initiate work on this project, but construction has been
    delayed. SAFCA supports the Administration's proposed fiscal year 2000
    budget for the Section 205 Program and requests the Corps be directed
    to initiate construction of the Magpie Creek Diversion Project within
    these available funds.
                     lower strong and chicken ranch sloughs
        SAFCA, in cooperation with Sacramento County, support the
    President's proposed budget of $500,000 in fiscal year 2000 for a
    Feasibility Study of the Lower Strong and Chicken Ranch Sloughs.
    Floodwaters from these urban streams are collected at the base of the
    American River levees and pumped into the river. In 1986 and again in
    1997, the limited channel and pumping capacity led to significant flood
    damages to a number of residential and commercial structures. Most of
    the flooding occurs when the American River is at a high stage due to
    releases from Folsom Dam. The original pump station was built by the
    Corps as part of the American River and Folsom project in the 1950's
    but has proven inadequate with the revised hydrologies. The Corps is
    currently conducting a Reconnaissance level study as directed by your
    Committee last year. They anticipate finding a Federal interest in
    pursuing a Feasibility level study to identify potential solutions and
    to determine if the originally authorized Federal project is deficient.
                                     ______

                   CALIFORNIA NAVIGATION AND RELATED PROJECTS
     Prepared Statement of Theodore Stein, Jr., Commission President, Port
                  of Los Angeles Board of Harbor Commissioners
        Mr. Chairman and Members of the Subcommittee: I am Ted Stein,
    President of the City of Los Angeles Board of Harbor Commissioners
    which oversees the activities of the Port of Los Angeles. My testimony,
    for the City of Los Angeles and its Board of Harbor Commissioners,
    speaks in support of continuation of the Federal role in the
    implementation of the major navigation improvements underway at the San
    Pedro Bay, California. Specifically, I am speaking of the Pier 400
    Dredging and Landfill Navigation Project and its funding in fiscal year
    2000. I am also presenting testimony on our project to deepen the Main
    Channel which is presently under study. At the outset, let me say that
    we sincerely appreciate the support of the Committee, over the past
    three years, in providing funds that have kept construction of the Pier
    400 Project--a vital and urgently needed project at the Port of Los
    Angeles--on schedule.
            pier 400 implementation under the 2020 development plan
        The San Pedro Bay ports of Los Angeles and Long Beach, and the U.S.
    Army Corps of Engineers, acknowledged years ago, that a dramatic
    increase in Pacific Rim trade volumes would likely take place over the
    next several decades. To meet the anticipated burgeoning international
    trade needs of the region and the Nation, the Port of Los Angeles
    engaged in a long-term, cooperative planning effort with the Corps of
    Engineers known as the 2020 Development Plan. The 2020 Plan accurately
    predicted the phenomenal growth of trade through the San Pedro Bay
    ports, and is a blueprint for the ports' infrastructure development
    that will accommodate the projected growth well into the 21st century.
    While the Port of Long Beach has since withdrawn from this
    collaboration, the Port of Los Angeles has moved forward with its
    implementation of the 2020 Plan.
        Divided into phases, Stage 2 of the 2020 Plan is a Federal deep-
    draft navigation project--known as the Pier 400 Dredging and Landfill
    Navigation Project--which is currently under construction. The
    Commissioners, management and staff at the Port of Los Angeles have
    been working with the Corps of Engineers since 1985 toward the
    implementation of the 2020 Plan which was authorized in the Water
    Resources Development Act of 1986 (WRDA) (Public Law99-662), and
    further sanctioned in WRDA 1988 (Public Law100-371) and WRDA 1990
    (Public Law101-640).
        The contracts for Stage 1 construction were completed by the Port
    in 1997 and we received a credit of $63.8 million toward our share of
    Stage 2 construction. Stage 1 included the dredging of new Federal
    deep-draft navigation channels that abut existing land at Pier 300 and
    the reclamation of 265 acres of new land at Pier 400. Stage 2 includes
    the dredging of new and deeper channels to Pier 300 and Pier 400, and
    the creation of an additional 315 acres of new land at Pier 400 upon
    which new state-of-the-art marine terminals will be built.
                              stage 2 construction
        I am pleased to inform the Subcommittee that, based on funds
    increased by this panel and Congress in fiscal year 1999, Stage 2
    construction is on schedule with completion expected in January 2000.
    The President's Budget for fiscal year 2000 includes $9.7 million to
    complete Stage 2 construction. We support this amount.
                         main channel deepening project
        The Port of Los Angeles also requests that your Subcommittee
    include $750,000 for the Federal share of the Preconstruction,
    Engineering and Design (PE&D) phase of the project to deepen the Main
    Channel. Although part of the Pier 400 Project includes deepening of
    some of the channels for safer and more efficient container ship
    navigation, the Main Channel's current depth is inadequate to
    accommodate the new state-of-the-art container vessels that carry more
    than 6,000 TEU's. These vessels are longer and wider than most of the
    current vessels, and most significantly, now draft up to 46 feet in
    depth. Presently, five of the major container shippers in the San Pedro
    Bay have vessels that draft 46 feet. Another 50 of this new generation
    of vessels is either under construction or on order, and they will meet
    the competitive requirements for shipping efficiencies in the 21st
    century.
        To accommodate the industry's shift to larger container vessels,
    the Port must deepen existing deep-draft navigation channels by at
    least an additional five feet, from the present depth of 45 feet Mean
    Lower Low Water (MLLW) to a minimum of 50 feet, to allow for safe
    shipping operation. This depth will accommodate the new generation
    vessels at 46-foot drafts plus an allowance for tides and under-keel
    clearance. The Main Channel project includes dredging approximately 4.5
    million cubic yards of sediment not only from the Main Channel, but
    also from the Turning Basin, the West and East Basins, and the East
    Basin Channel. The estimated cost for the project is approximately $40
    million.
        Typically, the Corps of Engineers, in initiating a Federal project,
    would perform preliminary studies. Based on favorable findings in these
    studies, the Port would then seek a Congressional appropriation to fund
    the feasibility study and other related studies. These steps can take
    more than two years to complete before the feasibility study is begun.
    To expedite this process, Section 203 of WRDA 1986 allows the local
    project sponsor to pay the full cost of the feasibility study. If the
    study shows a Federal interest, Section 203 further allows Federal
    reimbursement to the local sponsor in an amount equal to 50 percent of
    the costs. The Port of Los Angeles has undertaken a Section 203 Study
    of the Main Channel's dredging needs and has signed a Memorandum of
    Agreement (MOA) with the Los Angeles District Corps of Engineers. The
    MOA provides the framework under which the study will be completed and
    details the responsibilities of both the Port and the Corps of
    Engineers. The MOA also provides that support agreements are prepared
    for the Port to have the Corps of Engineers complete and pay for the
    work required for the studies.
        The Port anticipates that the Section 203 Report will be completed
    in less than a year. Ultimately, the Secretary of the Army will
    transmit to Congress his recommendations in time for authorization in
    the WRDA 2000 legislation. Consistent with the Corps of Engineers'
    seamless funding, once the Section 203 Report is sent to Washington for
    review by the Secretary, the PE&D phase can be undertaken by the Corps
    of Engineers early in fiscal year 2000.
        ongoing maintenance of existing federal channels and the harbor
                                   breakwater
        Related to the efficient operation of the completed Pier 400
    Project is the required ongoing maintenance of the existing Federal
    navigation channels at the Port of Los Angeles. The Port requests your
    Subcommittee to support an appropriation of $350,000 for ongoing
    maintenance of the existing navigation channels and the harbor
    breakwater. Specifically, $150,000 is needed for the Corps to perform
    engineering design for the maintenance dredging of the West Basin;
    $100,000 would enable the Corps of Engineers to continue their
    condition survey of the Federal channels; and, an additional $100,000
    would fund the continued rehabilitation of the harbor breakwater. This
    work is critical. Ongoing maintenance of the navigation channels will
    ensure that they remain at depths in which fully loaded container ships
    can safely navigate and guarantee the stability of the breakwater
    during severe storms.
        I might add, Mr. Chairman, that the Port of Los Angeles has been a
    ``donor port,'' under the Harbor Maintenance Tax (HMT) program,
    contributing approximately $70 million per year in HMT revenues since
    the inception of the fee in 1986. In contrast, the Port has been
    allocated only about $700,000 in Operation and Maintenance dollars
    because our maintenance dredging needs have been minimal. Consequently,
    we urge your support for the full appropriation of $350,000 to pay for
    the ongoing maintenance dredging of the Federal navigation channels at
    the Port, and the other ongoing channel and breakwater maintenance
    needs.
               continued funding of the los angeles harbor model
        The Port of Los Angeles further requests your Subcommittee to
    provide an appropriation of $165,000 for ongoing maintenance of the
    Port's harbor model at the Corps of Engineers' Waterways Experiment
    Station (WES) at Vicksburg, Mississippi. In addition, $355,000 is
    required for continued wave data collection. This information is
    necessary to validate the numerical and physical models used for
    ongoing project designs. During the state-of-the-art design phase for
    the Pier 400 Project land reclamation, eight separate, but related,
    models, were used and maintained by the scientists and engineers at WES
    and were, likewise, used by the engineers at the Port of Los Angeles
    and the Corps' Los Angeles District personnel.
        Maintenance of the hydraulic and physical models at WES, and their
    prototype data acquisition facilities, remains an essential resource
    for the Corps' Los Angeles District and for the Port of Los Angeles.
                    economic impact of the pier 400 project
        The Port of Los Angeles has testified in previous years on the
    economic impact its operations have on the Nation's economy; it cannot
    be over emphasized. Cargo throughput for the San Pedro Bay continues to
    grow and is estimated to more than triple in the next two decades.
    Actual growth in cargo handling, from 1990 through 1998, has already
    exceeded the forecast growth for that period. The trend is only upward.
    The ability of the Port to meet the continued demand of this phenomenal
    growth is dependent upon sufficiently deep water channels (such as
    those being constructed under the Pier 400 Project and planned for the
    Main Channel) that can accommodate the largest state-of-the-art deep-
    draft cargo vessels that are now on line in the world fleet of
    container ships. These new vessels provide greater efficiencies in
    cargo transportation, thereby offering consumers lower prices on
    imported goods, as well as more competitive exports from the United
    States to foreign markets.
        The Pier 400 Project is clearly a project of national significance,
    providing such economic benefits to the United States as: more than one
    million permanent well-paying jobs across the country; more than one
    billion dollars in wages and salaries; and, sales and income tax
    revenues, including increased U.S. Customs Service revenues. The return
    on the Federal investment is real and quantifiable, and is expected to
    surpass the cost-benefit ratio as determined by the Corps of Engineers'
    project feasibility study. The Federal investment in the Pier 400
    Project has, and we hope will continue, to ensure that the Nation's
    busiest container port remains competitive well into the 21st century.
                                   in summary
        Mr. Chairman, the Port of Los Angeles respectfully urges your
    Subcommittee to include in the Corps of Engineers' fiscal year 2000
    appropriation, the following funds to support the Corps of Engineers'
    work on behalf of the Port of Los Angeles:
      --$9.7 million for the Pier 400 Dredging and Landfill Navigation
            Project;
      --$750,000 to fund the Preconstruction, Engineering and Design phase
            of the Main Channel Deepening Project;
      --$350,000 for ongoing maintenance dredging, breakwater
            rehabilitation and condition survey;
      --$165,000 for ongoing maintenance of the Los Angeles Harbor Models
            at WES; and,
      --$355,000 for continued collection of wave data on the San Pedro Bay
            and Port of Los Angeles channels.
        The Port of Los Angeles has long valued your Subcommittee's
    demonstrated support for and understanding of the importance of the
    port industry to the economic vitality of the United States, and, in
    particular, of the Port's role in contributing to this country's
    economic vigor. This understanding has been evidenced by the
    appropriation of scarce Federal dollars for harbor and navigation
    projects such as our Pier 400 Project.
        Thank you, Mr. Chairman, for the opportunity to submit this
    testimony in support of continued funding for the Federal navigation
    activities at the Port of Los Angeles.
                                     ______

      Prepared Statement of Don Knabe, Chairman of the Board, Supervisor,
                     Fourth District, County of Los Angeles
        Los Angeles County respectfully requests that the Congress of the
    United States include funds in the fiscal year 2000 Energy and Water
    appropriations bill for the following projects, which are urgently
    required to preserve public safety in Marina del Rey and to begin the
    process of planned shoreline protection in Los Angeles County.
    Marina del Rey Entrance Channel Dredging ($6,500,000)
        The U. S. Army Corps of Engineers is responsible for maintenance
    dredging of the Marina del Rey's entrances and main channel, pursuant
    to a perpetual right of way and easement agreement with the County. The
    last design-depth dredging of Marina del Rey occurred in 1969. Since
    then, contaminants in some of the Marina's sediments have prevented
    thorough dredging. While small, clean-sediment dredging projects were
    conducted in 1987, 1994, 1996, and 1998, the south entrance to the
    Marina is nearly closed. This situation jeopardizes the safety of
    thousands of boaters who use our harbor, and it precludes prompt
    response by the Coast Guard and others to air-sea disasters off of LAX
    and other ocean emergencies.
        This year, the Port of Long Beach is constructing a new terminal by
    filling in a large slip. This project provides a unique opportunity,
    which will not be duplicated in the foreseeable future, to remove and
    safely dispose of 300,000 cubic meters of contaminated sediment from
    Marina del Rey. The Port's project schedule calls for acceptance of the
    Marina's sediments between October 1 and December 31, 1999, requiring
    funding in fiscal year 2000. If implemented as planned, this project
    will result in eliminating the need to dredge in Marina del Rey for
    many years. It will also remove contaminants from the Santa Monica Bay,
    provide clean material for beach replenishment, and greatly improve
    boating safety.
        It is critical that we take full advantage of this extraordinary
    opportunity to dispose of contaminated sediments in an environmentally
    safe and economical manner. The President's fiscal year 2000 budget
    does not include any funds to perform maintenance dredging at Marina
    del Rey. We are, therefore, requesting your support for an
    appropriation of $6.5 million to remove the 300,000 cubic meters of
    contaminated sediment, and as much clean sediment as is possible for
    beach replenishment. Without a thorough dredging in 1999, the Marina's
    entrances will continue to close, which could threaten the ability of
    the U. S. Coast Guard, the County Sheriff's Harbor Patrol, the County
    Lifeguards and the City and County Fire Departments to respond to
    emergencies. As these agencies are the critical core of the LAX Air-Sea
    Disaster Response Team, it is imperative that the Marina's entrances
    remain open and safely navigable.
    Marina del Rey and Ballona Creek Feasibility Study ($100,000)
        Some of the sediments creating navigational hazards in Marina del
    Rey's entrances contain contaminants that make dredging and disposal
    difficult and costly. The U. S. Army Corps of Engineers completed a
    reconnaissance study in 1996, which established that there is a Federal
    interest in solving this problem.
        The study is focused on economical and environmentally safe
    disposal options for the contaminated sediments, as well as on actions
    that can be taken in the Ballona Creek watershed that will eliminate or
    reduce the flow of contaminated sediments into Marina del Rey's
    entrance. Dedicated staff from the County, the Corps, the City of Los
    Angeles, the Santa Monica Bay Restoration Project, Heal the Bay, and
    other environmental and regulatory agencies have worked to limit the
    scope, time, and cost of this study. Based on the approved plan, the
    study was expected to require three years to complete, at a total cost
    of $2.7 million. The study has been ongoing for two years and is
    progressing on schedule toward completion next year. As the Los Angeles
    County Board of Supervisors has agreed to pay 50 percent of the study's
    costs, we are pleased that there are funds in the President's fiscal
    year 2000 budget for completion of this study. We, therefore, ask your
    support of the President's budget request of $100,000, for the Federal
    share of the cost in fiscal year 2000.
    Regional Dredged Material Management Plan Feasibility Study ($400,000)
        It is estimated that approximately 2.5 million cubic yards of
    contaminated marine sediments will need to be dredged from the harbor
    waters of Los Angels County over the next five years. Unfortunately,
    permanent sites for the disposal of these sediments are not available.
    As a result, routine maintenance dredging and port expansion activities
    have been critically hampered, impeding both navigation safety and the
    livelihood of the area's economy. In addition, the continuous buildup
    of contaminated sediments within the Los Angeles Region's coastal
    waterways raises concerns with respect to potential impacts to public
    health and the health of the marine environment.
        A multi-agency Contaminated Sediments Task Force has been formed to
    address these concerns and to try to solve the problems associated with
    the dredging and disposal of contaminated sediments. This Task Force is
    comprised of representatives from Federal and State regulatory and
    resource agencies, ports and harbors, local agencies, research
    institutions, and local environmental groups.
        Recognizing the fact that contaminated sediments are a serious
    problem for the Los Angeles Region, the State of California has
    committed $1 million over a five-year period to fund the administrative
    cost (staff time and coordination efforts) of the Task Force. Its
    objective is to develop a management strategy to control and dispose
    contaminated dredged material. However, the Task Force quickly
    discovered that these funds are not sufficient to acquire the necessary
    data, investigate disposal site alternatives, and initiate pilot
    projects to analyze promising new technologies. These efforts need to
    be accomplished to support development of regional management strategy
    for contaminated sediments.
        This letter is, therefore, to request your support for $400,000 in
    Federal funds in fiscal year 2000 to prepare a Feasibility Project
    Study Plan (PSP), negotiate and sign a Feasibility Cost Sharing
    Agreement (FCSA) between the Federal government and non-federal
    interests, and to initiate the feasibility study following the
    execution of the FCSA. The feasibility study will develop a regional
    dredged material management plan for the ports, harbors, and marinas
    within the coastal waters of Los Angeles County. The study plan will
    include: (1) gathering data; (2) investigating sediment threshold
    levels for the disposal of contaminated dredged sediments; (3)
    analyzing potential regional disposal site alternatives having economic
    and environmental viability; and (4) preparing a framework to analyze
    innovative dredged material treatment technologies through a series of
    pilot projects.
        It is understood that, as non-federal stakeholders, the Task Force
    members will need to cost share the regional dredged material
    management plan feasibility study with the Federal government, and we
    are committed to work with the other members to secure funding for this
    very important study.
    Coast of California Study--Los Angeles County ($400,000)
        Los Angeles County is famous for its beautiful, sandy beaches that
    attract over 50 million visitors each year. What is little known is
    that these beaches are not naturally sandy. Since the 1930's, over 35
    million cubic yards of sand have been removed from various public works
    projects and used to widen the beaches. Unfortunately, there has been
    no planned approach to protecting and maintaining these beaches, which
    are important parts of our infrastructure and a major economic engine
    for the region. In fact, our beaches protect critical highways,
    utilities, public beach facilities, as well as homes and businesses.
    Based on data from a university study, the Economic Development
    Corporation of Los Angeles has estimated that the annual economic value
    of Los Angeles County's beaches is $20.7 billion.
        The El Nino storms of 1998 caused severe erosion of some of our
    beaches, resulting in the creation of a Los Angeles County Beach
    Replenishment Task Force, which is intended to develop a long-term
    management plan for our beaches, as well as to seek out funding sources
    for beach restoration projects. The Task Force has determined that the
    County's beaches have not been regularly surveyed since the early
    1970's, or studied at all since the early 1990's. Effective beach
    managmenet requires a thorough baseline study and annual surveys for
    monitoring erosion and acretion.
        The Coast of California Study, as authorized by the Water Resources
    Development Act, is an ideal starting point for development of a long-
    term beach management plan. Based on studies already completed for San
    Diego and Orange Counties, your support for an fiscal year 2000
    appropriation of $400,000 for a Los Angeles County--Coast of California
    Study is requested.
                                     ______

      Prepared Statement of Richard W. Parsons, Dredging Program Manager,
                             Ventura Port District
        The Ventura Port District respectfully requests that the Congress:
        1. Include $3,500,000 in the fiscal year 2000 Energy and Water
    Development Appropriations Bill for the U.S. Army Corps of Engineers
    maintenance dredging of the Ventura Harbor federal channel and sand
    traps and repair of a groin.
        2. Include $300,000 in the fiscal year 2000 Energy and Water
    Development Appropriations Bill to continue a cost shared Feasibility
    Study to determine the advisability of modifying the existing Federal
    navigation project at Ventura Harbor to include a sand bypass system.
                                   background
        Ventura Harbor, homeport to 1,500 vessels, is located along the
    Southern California coastline in the City of San Buenaventura,
    approximately 60 miles northwest of the City of Los Angeles. The harbor
    opened in 1963. Annual dredging of the harbor entrance area is usually
    necessary in order to assure a navigationally adequate channel. In
    1968, the 90th Congress made the harbor a Federal project and committed
    the U. S. Army Corps of Engineers to provide for the maintenance of the
    entrance structures and the dredging of the entrance channel and sand
    traps.
        The harbor presently generates more than $40 million in gross
    receipts annually. That, of course, translates into thousands of both
    direct and indirect jobs. A significant portion of those jobs are
    associated with the commercial fishing industry (over 30 million pounds
    of fish products were landed in 1996), and with vessels serving the
    offshore oil industry. Additionally, the headquarters for the Channel
    Islands National Park is located within the harbor, and the commercial
    vessels transporting the nearly 100,000 visitors per year to and from
    the Park islands offshore, operate out of the harbor. All of the
    operations of the harbor, particularly those related to commercial
    fishing, the support boats for the oil industry, and the visitor
    transport vessels for the Channel Islands National Park are highly
    dependent upon a navigationally adequate entrance to the harbor.
                         operations & maintenance needs
    Dredging
        The Corps of Engineers has determined that $2,875,000 will be
    required to perform routine maintenance dredging of the harbor's
    entrance channel and sand traps during fiscal year 1999. This dredging
    work is absolutely essential to the continued operation of the harbor.
    Groin Repairs
        It is estimated that $625,000 will be required during fiscal year
    2000 for the Corps of Engineers to repair extensive El Nino related
    storm damage to the South Beach Groin. This structure is an important
    component of the harbor's entrance system and its repair must be
    accomplished expeditiously in order to assure the maintenance of a
    navigationally adequate entrance channel. Additionally, it should be
    noted that the failure to repair this structure will result in
    increased maintenance dredging costs in subsequent years.
                                  study needs
        The Corps of Engineers has asked that $100,000 be provided in
    fiscal year 2000 to continue a cost shared Feasibility Study to
    determine the advisability of modifying the existing Federal navigation
    project at Ventura Harbor to include a sand bypass system. Given the
    continuing need for maintenance dredging, it is respectfully requested
    that the funding be increased to $300,000 in order to expedite this
    effort to determine if a sand bypass system or other measures can
    accomplish the maintenance of the harbor in a manner that is more
    efficient and cost effective than the current contract dredging
    approach.
                                     ______

      Prepared Statement of Alexander Krygsman, Director, Port of Stockton
        Mr. Chairman: I am Alexander Krygsman, Port Director of the Port of
    Stockton in Stockton, California.
        The San Francisco Bay to Stockton Ship Channels Project is an
    authorized project.
        The Port of Stockton is primarily a bulk port that serves industry
    and agriculture in the San Joaquin Valley in California, and the bulk
    imports and exports of the Western States.
        The Port of Stockton recognized as far back as 1952 that deeper
    channels would be needed for the movements of bulk cargoes and
    requested the Corps of Engineers to deepen the channel in 1952. Coal,
    grain, fertilizers and many other bulk materials require deeper
    channels to serve the larger bulk carriers.
        The Nation needs ports that can handle larger, more economical and
    more fuel-efficient vessels close to the production areas, both
    agricultural and industrial.
        The Port of Stockton is such a port.
        The dredging of the Stockton Channel portion of the project to
    thirty-five (35) feet was completed in 1987. A copy of the Port of
    Stockton's most recent annual report is attached. Cargo volume has
    increased since the dredging of the Stockton Channel was completed; and
    the project is certainly paying off.
        Therefore, we requested the Corps of Engineers for a new navigation
    study (reconnaissance study) to deepen the Channel further, to forty
    (40) feet or more, if economically feasible. The funding for this study
    was appropriated in fiscal year 1998. The reconnaissance study
    determined that there is a Federal interest in further deepening the
    Channel.
        For the 2000 fiscal year, we are requesting three-hundred-thousand
    dollars ($300,000) for the feasibility study. Because this study has to
    be coordinated for proper timing with the U.S. Navy's project to deepen
    the Channels to the Concord Weapons Station, this study needs to be
    done now. The feasibility study is fifty percent (50 percent) cost-
    shared.
        The President's proposed 2000 budget only contains one-hundred-
    fifty-thousand dollars ($150,000) for the feasibility study, but the
    feasibility study and the eventual construction, needs to be closely
    tied to the deepening of the Channel through San Pablo Bay, and this
    project needs to be timed appropriately with that construction.
    Deferring one-hundred-fifty-thousand dollars ($150,000) now could cost
    millions in extra cost later.
        The President's proposed 2000 budget includes one-million-six-
    hundred-sixty-two-thousand dollars ($1,662,000) for maintenance. This
    is insufficient. Every time insufficient funds are provided for
    complete maintenance, and the maintenance dredging, therefore, cannot
    be completed at one time, an additional mobilization and de-
    mobilization cost of between five-hundred-thousand dollars ($500,000)
    and one-million dollars ($1,000,000) is incurred when it is completed.
    Three-million dollars ($3,000,000) is required for an average, complete
    maintenance dredging job. Appropriating less than three-million dollars
    ($3,000,000) results in extra mobilization and de-mobilization cost
    between five-hundred-thousand dollars ($500,000) and one-million
    dollars ($1,000,000) United States Senate Energy and Water Development
    Appropriations Sub-Committee of the Senate Appropriations Committee
    Page three each time each additional maintenance job, which increases
    the cost by thirty percent (30 percent) to sixty percent (60 percent),
    not counting staff time, testing cost, permitting cost, et cetera. It
    could very well double the actual cost.
        We urge you to appropriate three-hundred-thousand dollars
    ($300,000) for the Stockton Deep Water Channel Feasibility Study. We
    also strongly urge that three-million dollars ($3,000,000) be
    appropriated to maintain the Channels so that the present benefits also
    may continue to accrue, and to avoid the additional cost incurred when
    insufficient funds are provided to complete the required maintenance at
    one time.
                                     ______

         Prepared Statement of Mayor Rodger Anderson, City of Morro Bay
        During World War II the Army Corps of Engineers (ACOE) designed and
    constructed a new harbor entrance at Morro Bay with two rock
    breakwaters. Since the initial construction, over 50 years ago, the
    Federal government has maintained the harbor entrance, breakwaters and
    navigational channels.
        In fiscal year 1995 the ACOE completed the Morro Bay Harbor
    entrance improvement project to improve safety for commercial fishing
    and navigation. The City of Morro Bay was the local sponsor and
    contributed over $900,000 in cash and in-kind services. Morro Bay is a
    small city of 10,000 with very limited resources but made this project
    one of its highest priorities for almost 10 years because of the
    regional importance of the harbor. Without continued Federal
    maintenance, all of the past local and federal investment will be lost.
        Morro Bay Harbor is the only all-weather harbor of refuge between
    Santa Barbara and Monterey on the West Coast. Our Harbor directly
    supports almost 250 home-ported fishing vessels and marine dependent
    businesses. We provide irreplaceable maritime facilities for both
    recreational and commercial interests. Businesses that depend on the
    harbor generate $53,500,000 annually and employ over 700 people. The
    United States Coast Guard (USCG) maintains a 15 person search and
    rescue station at Morro Bay Harbor to provide the Coast Guard services
    for the entire Central California Coast.
        Exposure to the open ocean and strong winter currents carrying
    sediment into the harbor create the need for a routine maintenance
    schedule to insure that the harbor entrance and federally designated
    navigation channels remain safe and navigable. It is imperative that
    the federally constructed navigation channels and protective jetties be
    maintained to insure safe commerce and navigation on a 300 mile stretch
    of the California Coast.
        This year, the President's budget recommend $2.5 million to
    maintain our harbor in the fiscal year 2000 budget. We are requesting
    your distinguished Subcommittee approve the funding as recommended in
    the President's budget. This funding will be utilized for maintenance
    of the federally designated navigation channels. It is estimated that
    an additional $5.2 million in fiscal year 2001 will be required to
    complete this crucial maintenance project, including maintenance of the
    entrance area and the south jetty.
        In addition to being home port to over 250 commercial fishing
    vessels, Morro Bay Harbor is part of the federally designated National
    Estuary Program. The Morro Bay Estuary was the subject of an ACOE
    reconnaissance study (funded by Congress in 1998) of potential projects
    to and restore sensitive habitat through improving tidal circulation.
    The Bay Foundation, a local non-profit conservation group, has put
    together a coalition to act as local sponsor for the Feasibility Phase
    of the Ecosystem Rehabilitation Project. We also request you approve
    the President's recommendation for $100,000 to initiate a feasibility
    study for this project in fiscal year 2000.
        Our thanks again for your actions and continued support. I am
    grateful for the opportunity to present these requests to your
    Subcommittee on behalf of the citizens of the City of Morro Bay.
                                     ______

      Prepared Statement of Peter Green, Mayor, City of Huntington Beach,
                                   California
        Mr. Chairman and Members of the Subcommittee: My name is Peter
    Green, and I am the Mayor of Huntington Beach, California. Thank you
    for the opportunity to present testimony regarding the fiscal year 2000
    budget for the U.S. Army Corps of Engineers.
        The City of Huntington Beach requests $300,000 for a feasibility
    study for the continuing Huntington Beach Coastal Bluff Restoration
    Project at Blufftop Park. Although the Corps completed an initial
    reconnaissance study in March of 1995, finding that the erosion of the
    cliffs has been and will be gradual and attributable to normal wind and
    wave erosion, in fiscal year 1999, Congress appropriated $100,000 to
    amend the Corps initial reconnaissance study to include storm damage as
    an accelerator to the normal bluff erosion. Several major Pacific
    storms in the past ten years have caused major damage to these cliffs,
    and it is anticipated that the amended reconnaissance Study will find
    Federal interest in restoration of our coastal bluffs.
        In February of 1995, while the Corps was performing its
    measurements for the initial Reconnaissance study, a major Pacific
    storm struck. Damage from this storm resulted in a state and Federal
    disaster being declared. The Corps took cliff face measurements before
    and after the storm event. This one storm event, it was discovered, had
    created eight new embayments, causing the cliff face to retreat between
    6 and 15 feet, over only a two-day period. With only a few more storms
    such as this one, not only would Blufftop Park be gone, but Pacific
    Coast Highway would also be threatened.
        The initial study defined an 8,000 feet stretch of coastal bluffs
    extending from the southern boundary of Bolsa Chica State Beach to 17th
    Street. The ``Central Reach'' runs northward from the vicinity of
    Goldenwest Street for approximately 4,600 feet. This portion of cliff-
    face rises 30 to 40 feet above the Pacific Ocean. These cliffs consist
    of poorly consolidated alluvium and marine terrace deposits. They are
    subject to erosion from wave action, wind and storm damage. The slope
    of the cliff-face is relatively steep. In the central and southeastern
    portions of this reach, the beach berm is absent and wave run-up
    routinely reaches the cliff base at high tide. Most of the cliff base
    and portions of the cliff face have been protected by a non-engineered
    revetment consisting of concrete rubble and quarrystone. Erosion
    embayments exist in the cliff base and cliff face where revetment
    coverage is sparse or absent.
        This ``Central Reach'' contains the highest concentration of park
    facilities along the cliff top, including safety railing, security
    lights, pedestrian walkway, bicycle path, irrigated landscaping, picnic
    tables, benches, bicycle racks, drinking fountains, metered parking
    lots and a paved ramp leading from the cliff top to the beach at each
    end of the reach. Records indicate that the pedestrian walkway and the
    bicycle path are used by over 700,000 people annually. A closure would
    cause an estimated annual recreational loss of $238,200. Seaward of the
    northern parking lot, the bluffs are approaching failure in four large
    embayments (total length of about 700 feet). The City has closed the
    most seaward of the two trails. Four measures were considered for
    reducing or eliminating loss under the assumption that the cliff will
    retreat 8 feet in the next 25 years and 25 feet in the next 50 years.
    The four measures include simply relocating park facilities and three
    alternative methods of constructing engineered revetment. Three of the
    four measured display a positive benefit to cost ratio.
                                     ______

           Prepared Statement of Dick Lyon, Mayor, City of Oceanside
          oceanside harbor maintenance and operation dredging program
        The City of Oceanside and the Oceanside Harbor District request
    your support of $1,170,000 in the fiscal year 2000 budget for the
    Oceanside Harbor Maintenance Dredging Program.
        In 1960, Congress authorized full federal funding for maintenance
    of the Oceanside Harbor entrance (House Document 456, 86th Congress,
    2nd Session, Public law 85-500.) in recognition of the fact that the
    Harbor entrance was constructed as an emergency wartime measure in
    1942. To this day, the Oceanside Harbor entrance continues to serve the
    vital military installation of Camp Pendleton Harbor. In 1992, the
    Harbor District partnered with the federal government in a local cost
    share agreement to modify the harbor entrance and the authorized
    channel depth to reduce storm damage, provide surge protection to the
    harbor's infrastructure and provide significant reduction of
    navigational hazards that have produced 11 deaths, 49 serious injuries,
    134 boating accidents and $1,500,000 of damage to vessels in the harbor
    entrance.
        Oceanside Harbor would experience severe negative impacts should
    the dredging project not be funded. Such action would prevent access to
    the Pacific Ocean to the United States Navy and Marine Corps as joint
    users of the entrance channel, as well as the U.S. Coast Guard Cutter
    Point Hobart, which is also based in Oceanside. The economic impact
    upon the local fishing fleet, the commercial sportfishing fleet and the
    1,000 recreational vessels berthed here, as well as the businesses
    supported by the harbor, would be critically impacted.
        The maintenance program is essential for the safe navigation into
    Oceanside Harbor and the U.S. Marine Corps Base Camp Pendleton Harbor.
    The program also provides beach sand restoration, shoreline protection,
    recreational and commerce benefits.
        Thank you for the opportunity to provide this testimony and for
    your consideration of the request.
                   san diego county regional shoreline study
        The City of Oceanside is seeking $1,500,000 as an addition to the
    fiscal year 2000 budget for a San Diego County Regional Shoreline
    Study. The funds for this project are not included in the
    Administration budget.
        Oceanside has a 57-year history of beach erosion resulting from the
    Camp Pendleton Harbor construction that began in 1942. The federal
    government acknowledged its responsibility for Oceanside's beach
    erosion in 1953. A letter report to the U.S. Navy from the Army Corps
    of Engineers noted that the construction of the Camp Pendleton jetties
    had compartmentalized the littoral cell and resulted in the loss of 1.5
    million cubic yards of sand in Oceanside during 1950-1952. An
    additional U.S. Army Corps of Engineers report to Congress in 1956
    concluded that only restoration of the protective beach at Oceanside
    would protect the upland area and restore and maintain a satisfactory
    recreational beach. In 1958, the Navy extended the north harbor jetty
    to reduce the entrance channel maintenance problems. This action
    further aggravated the erosion of the beaches.
        In 1967, congress authorized a review study of beach erosion at
    Oceanside resulting in the Office of the Chief of Engineers confirming
    100 percent federal responsibility.
        Despite numerous and significant efforts in placing sand on the
    beach, periodic nourishment of the beach from maintenance dredging of
    the harbor entrance and sand bypassing project, no permanent solution
    to the massive erosion problem has yet to be achieved.
        The 1994 U.S. Army Corps of Engineers Reconnaissance Report on the
    Oceanside Shoreline concluded that there is a federal interest in
    maintaining the Oceanside beach and suggested several planned
    alternatives, including a beach fill, a groin system with beach fill,
    and a submerged breakwater system. However, federal cost-sharing law
    provides that non-federal interests (the City) pay 35 percent of the
    project construction costs and annual maintenance. The federal rules
    also require a 50 percent cost-sharing for the feasibility phase of the
    project study. The City of Oceanside has been advised that Congress can
    only provide special 100 percent funding for a beach restoration
    project if there is a study that would quantitatively justify a larger
    federal cost-share based on the project being required to ``mitigate''
    a federal action (i.e. the federal construction of the Camp Pendleton
    Harbor). If the study documents that the erosion is 100 percent the
    result of the federal construction of the harbor, full federal funding
    would be justified on a future project. The City of Oceanside is
    seeking $1.5 million to conduct the study to justify special federal
    cost-sharing.
        The language for the study is as follows:
        SAN DIEGO COUNTY REGIONAL SHORELINE STUDY. In recognition of the
    findings of past studies by the U.S. Army Corps of Engineers as
    published in House Document 456, 86th Congress, 2nd session and other
    related reports which conclude that the erosion of Oceanside Beach and
    other downcoast beaches has been caused by the construction of Camp
    Pendleton Harbor as a wartime measure, without provision for bypassing
    material to the downcoast beaches; and in equity restoration and
    maintenance of downcoast beach conditions that would be existing today
    if adequate bypassing was provided as part of harbor construction
    should be a Federal responsibility; therefore the Secretary, acting
    through the U.S. Army Corps of Engineers is directed to conduct a study
    to determine the extent of the erosion impact caused by Camp Pendleton
    Harbor, and to develop plans to mitigate these impacts. The cost of the
    study should be 100 percent Federal cost and not exceed $1.5 million.
        Thank you for the opportunity to provide this testimony and for
    your consideration of the request.
                                     ______

      Prepared Statement of Brian E. Foss, Port Director, Santa Cruz Port
                              District Commission
        Santa Cruz Harbor is an active small craft harbor at the north
    section of Monterey Bay, California. It was authorized as a federal
    navigation project in 1958, constructed in 1964, and expanded in 1972.
    A 1986 joint-venture between the U.S. Army Corps of Engineers and the
    Santa Cruz Port District provided for a permanent sand bypass system to
    solve the ocean-driven shoaling problem at its entrance. The Port
    District has successfully operated that system for the past thirteen
    winters. However, the Port District has been unable to solve the
    siltation problem emanating from the three-square mile watershed which
    terminates at the north end of Santa Cruz Harbor.
        Silt from Arana Gulch fills berths, fairways, and channels in the
    harbor, making them hazardous and unusable. At this time, the siltation
    is not solvable by the existing sand bypass system. The soil
    characteristics of the watershed make beach disposal impractical at
    this time. Arana Gulch sediment must either be taken upland or
    delivered by barge offshore--both of these disposal options are quite
    wasteful. They are also extremely expensive and cost the Port District
    hundreds of thousands of dollars each year. Additionally, the 1998 El
    Nino storms brought 15,000 cubic yards of material into the north
    harbor alone from Arana Gulch. The event was declared a federal
    disaster, and FEMA and the State of California are spending in excess
    of $400,000 to return the harbor to charted depths.
        On June 25, 1998, the House Committee on Transportation and
    Infrastructure passed Resolution Docket 2565 authorizing the Secretary
    of the Army to review the Arana Gulch watershed siltation problem.
        The Port District respectfully requests that $100,000 be
    appropriated for the Arana Gulch reconnaissance study for fiscal year
    2000.
                                     ______

     Prepared Statement of Jimmy Smith, Commission President, Humboldt Bay
        Harbor, Recreation and Conservation District, Eureka, California
        Mr. Chairman and members of the subcommittee: Thank you for the
    opportunity for me, Jimmy Smith, as Commission Chairman of the Humboldt
    Bay Harbor, Recreation and Conservation District in Eureka, California
    to submit prepared remarks to you for the record in support of the
    Fiscal Year 2000 Energy and Water regular appropriations measure to
    fund the U.S. Army Corps of Engineers into the new millennium.
    Commissioner Roy Curless and Chief Executive Officer David Hull will
    represent the Commission and District in meetings with subcommittee
    staff and agency representatives and respond to any project-related
    questions that arise during those meetings and appearances.
        The Commission recognizes and expresses its debt of gratitude to
    our retired Congressman Frank Riggs and retired Congressman Fazio (both
    former members of this subcommittee), our new Congressman (and former
    State senator) Mike Thompson, Subcommittee Chairman Packard from
    California, and the other members of this subcommittee and staff for
    their continuing efforts in funding the Humboldt Harbor and Bay
    Navigation Project. This project is of critical importance to the
    future development of Humboldt Bay and county, and the entire north
    coast region of the State of California.
        With your support, the conference report on fiscal year 1999
    appropriations contained six million dollars for our project as a new
    construction start we support the President's budget request in the
    amount of $3.2 million in the construction general account to complete
    project construction in fiscal year 2000.
        We are likewise grateful to the subcommittee for including $3.910
    million in the operations and maintenance general account for fiscal
    year 1999. We support the President's budget request for an additional
    $4.189 million in the operations and maintenance general account for
    fiscal year 2000 and request the subcommittee increase this amount to
    $5.689 million dollars.
        The increased budget request from fiscal year 1999 is derived from
    three sources. $300,000 is attributable to annualized cost increases
    and additional survey work to monitor the new hydrodynamics of the
    channel after completion of project construction. A second element of
    the additional request above the President's budget will permit the
    Corps to extend their survey south of the navigation channel to
    determine how the sand accumulation is impacting the main channel
    saving additional money over the long term. This survey effort will
    cost an estimated $150,000. The last element included in the request is
    for an additional $1.35 million to be appropriated to dredge this same
    area.
        Although the exact quantities to be dredged will not be determined
    until the survey is complete, our estimates and the emergency nature of
    this request accounts for the additional $1.5 million sought over the
    President's budget request for the operations and maintenance general
    account.
        Completion of the long sought new construction project (the harbor
    deepening project) will vastly improve the safety of navigation in
    Humboldt Bay and help us begin to diversify our maritime economy. For
    those unfamiliar with the geography, Humboldt Bay is the only deep-
    draft natural harbor strategically situated along five hundred miles of
    Pacific coastline between San Francisco and Coos Bay, Oregon. Extreme
    winter storm conditions at the Humboldt Bay and entrance have posed
    extreme navigation safety hazards, resulting in loss of life and
    significant property damage over the years.
        To us, regular maintenance dredging can be a life and death, as
    well as economic, survival matter. For example, in a commendable effort
    to save Federal and local sponsor financial resources, the Corps' San
    Francisco District previously scheduled combined operations/maintenance
    and construction dredging for this spring. An unanticipated delay in
    final approval of our project cooperation agreement has resulted in
    dangerous shoaling of portions of the bar and entrance channel being
    allowed to persist for more than four months. Deep draft vessels and
    commercial fishermen have encountered shoaling conditions currently at
    18' in places where normally it would be 40' deep. This shoaling poses
    additional safety risks of ship grounding over and beyond those
    inherently unsafe seasonal conditions intended to be remedied by the
    channel improvement project itself.
        Recently a Corps hopper dredge itself was damaged by high wave
    action while attempting to undertake emergency maintenance dredging of
    the shoals. Indicative of adverse economic impacts, a vessel calling at
    a Louisiana-Pacific Corporation facility was delayed by shoaling
    conditions resulting in $1.5 million in delay penalties and lost sales.
    This furthers the perception of an unreliable harbor entrance and could
    have significant adverse impacts to the wood chip export market.
    Completion of the construction will substantially alleviate these
    conditions.
        Project completion will provide unique economic development
    opportunities for the North coast region. These capitalize upon our
    natural resources base enabling us to ship our commodities to world
    markets at competitive freight rates, and ship more of our imports and
    exports by water rather than transship them long distances by road or
    rail to market. At the same time, it will permit us to diversify our
    economic base by improving our transportation infrastructure and
    attracting new industrial activity to an area largely dependent upon
    the economic well-being of the forest products industry. We are
    currently suffering from closure of major facilities and continuing
    uncertainty surrounding the industry's future as a major contributor to
    our long term economic base.
        With the support of then Congressman Riggs, Congress authorized the
    Humboldt Harbor and Bay 38 foot deep draft navigation project in
    section 101 of the Water Resources Development Act of 1996 (WRDA 1996)
    (Public Law 104-303) at an estimated total construction cost of
    $15,178,000 with a required local contribution of $5,180,000 and a
    first Federal cost of $10,000,000. The project has a 1.9 to 1 favorable
    benefit cost ratio. It has no significant environmental impacts and
    enjoys the consensus support of Federal, State, regional and local
    agencies.
        In June 1998, with the support of the California Maritime
    Infrastructure Authority in the first of its kind issuance of revenue
    bonds to finance a Federal navigation project, we were able to raise
    $3.9 million matched by an additional $1.0 million in local
    redevelopment agency funds from the city of Eureka to meet our required
    local contribution to the project construction cost. Since then, we
    have been waiting for a final approved project cooperation agreement
    and commencement of construction. The Harbor District Board of
    Commissioners voted unanimously to authorize execution of the final
    agreement on March 16, 1999.
        In order to provide an additional revenue stream from which to
    service the debt incurred in meeting its financial obligations, the
    district has implemented the first of its kind harbor user fee under
    section 208 of WRDA 1986 so that vessels and cargo benefitting from the
    navigation improvements will share in the cost of providing them.
        Thanks to an accelerated final review by Secretary Westphal's
    staff, we anticipate his approval of the agreement this week with
    advertisement and contract award to follow soon in the second quarter
    this fiscal year and completion of construction on schedule next fiscal
    year.
        On behalf of the members of the commission and district, we
    appreciate those prior occasions in which we have had the opportunity
    to appear before the subcommittee and look forward to appearing before
    this subcommittee on future occasions to provide progress reports
    concerning the successful completion of this project. We are prepared
    to supplement our prepared remarks for the record in response to any
    questions that the Chair, subcommittee members or staff may wish to
    have us answer.
        Thank you Mr. Chairman and members of the subcommittee. This
    concludes my prepared remarks.
                                     ______

     Prepared Statement of E.D. Allen, Chief Harbor Engineer, Port of Long
                                     Beach
        I am E. D. Allen, Chief Harbor Engineer for the Port of Long Beach,
    California. The Port of Long Beach is this nation's largest container
    port. I have been authorized by the Board of Harbor Commissioners of
    the City of Long Beach to represent the Port of Long Beach in regard to
    appropriations for the Los Angeles and Long Beach Harbors Model Study
    and Wave Data Collection Program; construction of the Queen's Gate
    Deepening Project as part of our on-going 2020 Plan; Los Angeles River
    maintenance dredging; Feasibility Studies for beach erosion; and
    Reconnaissance and Feasibility Studies for Contaminated Sediment
    Disposal.
        In addition to the following specific project appropriation
    requests, I am recommending the committee recognize the need for a
    standby Corps dredging capability to supplement private contractors in
    the event of emergencies.. I specifically recommend a standby dredging
    and personnel training capability be funded without a minimum dredge
    quantity per year. This will allow:
        (1) private contractors to benefit from receiving previous Corps
    annual dredging quantities and
        (2) Corps of Engineers equipment to be used in emergencies without
    a project funding appropriation.
        As a result, minor maintenance dredging could be undertaken at the
    Corps' discretion for training purposes which would provide a
    tremendous benefit to the smaller ports and harbors. Many of the needs
    of the smaller ports have not been met due to the lack of a program
    such as this.
        My more specific requests follow for listed projects.
          harbors model maintenance (civil works budget category--o&m)
        The Water Resources Development Act of 1976, Section 123,
    authorized the Chief of Engineers to operate and maintain the Los
    Angeles-Long Beach Harbor Hydraulic Model at the U.S. Army Corps of
    Engineers Waterways Experiment Station in Vicksburg, Mississippi as
    part of the Los Angeles and Long Beach Harbors Model Study. This model
    encompasses both port complexes in San Pedro Bay, which, as the third
    largest container port complex in the world, are ports of national
    strategic and defense significance. The hydraulic model, along with
    several numeric models, provide state-of-the-art methodology that can
    be used to provide operational improvements to the San Pedro Bay ports
    and many other harbor complexes. In addition, the Port, as the local
    agency, is assisting in the Corps effort to provide collection of
    continuous wave-gauge data by providing necessary support personnel and
    equipment for the maintenance of portions of the systems located at the
    Port.
        In fiscal year 1999, $165,000 was appropriated for maintenance of
    the physical model of San Pedro Bay. During this time, the Port also
    used the model to analyze necessary navigation-related modifications to
    our upcoming expansion within the Navy Basin and validate numerical
    model results. This effort is being funded by the Port and is on-going.
    It is necessary that the model remain ready for service such as this.
    Funding in fiscal year 2000, in the amount of $165,000, would continue
    annual maintenance on the model. Additionally, we are requesting
    $335,000 in continued funding for the wave gage (prototype) data
    acquisition and analysis program. The wave data gathering program is
    essential as it provides real-world information to compare to model
    performance. The wave data acquisition program began in 1987 to provide
    validation of the design of the 2020 Plan, our Master Plan for port
    expansion and navigation improvements. This program has now evolved to
    construction monitoring and model verification which needs to continue
    to confirm expected levels of impacts of the expansion plans. The
    shipping industry's increasingly larger vessel size continues to
    challenge port engineers. The need for modeling and wave gage data
    acquisition continues to be a critical tool supporting the ports
    ability to create facilities compatible with changing trade conditions
    and operations. Therefore, Congress is respectfully requested to
    appropriate $500,000 for fiscal year 2000 to perform this work.
         port of long beach deepening, queens gate (civil works budget
                            category--construction)
        The Port of Long Beach developed a long-range master plan, referred
    to as the 2020 Plan, which demonstrates the need for deeper navigation
    channels at the Queens Gate entrance to San Pedro Bay and additional
    landfill development through the year 2020.
        Section 201(b) of the Water Resources Development Act of 1986
    authorized construction of the 2020 Plan upon recommendations of a
    feasibility report and completion of a favorable Chief of Engineers
    Report. The Chief's Report was issued July 26, 1996 and the Office of
    Management of Budget has approved the Report. The first phase of the
    Plan deepens the Long Beach Main Channel to a depth of 76 feet. This
    project is known as the Port of Long Beach Deepening. Together with the
    approach channel deepening outside the federal breakwater, the dredging
    was evaluated for Federal interest in the feasibility study because it
    permits deeper draft crude petroleum vessels to call at the Port of
    Long Beach.
        This project was funded in 1998 and 1999 and is on-going. We fully
    anticipate that the Corps will provide sufficient programmed funds to
    complete this project with no additional funding appropriations. I am
    pleased to note that the Corps specified the work in such a manner that
    we can achieve a measurable benefit from the project as each foot of
    depth is dredged.
     los angeles river maintenance dredging (civil works budget category--
                                      o&m)
        The Port of Long Beach also concurs with and supports the
    recommendation of C-MANC and the City of Long Beach to federal fund
    remedial maintenance dredging to remove accumulated flood-deposited
    silt in the mouth of the Los Angeles River. During the storms of 1995,
    flood-deposited silt closed the mouth of the Los Angeles River to
    navigation. This restricted regularly scheduled water route
    transportation between the cities of Long Beach and Avalon, creating an
    economic emergency. Reacting to this, the U. S. Army Corps of Engineers
    removed 300,000 cubic yards from the channel which allowed for minimal
    resumption of navigation.
        On a yearly basis substantial quantities of silt remain in the
    channel. These silt deposits create the likelihood of future serious
    restrictions and safety hazards to commercial and recreational boating
    activity in, and adjacent to, the Long Beach Harbor District and the
    associated businesses in Long Beach. Such restrictions and hazards have
    resulted in accidents and litigation.
        The Port supports the City in recommending that these silt deposits
    be removed on an annual basis as a scheduled work item. In the draft of
    ``Project Plan for Los Angeles River Estuary Maintenance Dredging, Long
    Beach, CA, October 1994'' (Draft Project Plan-1994), the Corps of
    Engineers estimated an average annual deposit of silt in the estuary of
    485,000 cubic yards. The rate of such deposits is influenced by
    operational decisions at the Corps of Engineers' dams located at the
    headwaters of the river. It is imperative for our current operations,
    that a long range remedy be found for the Los Angeles River mouth, if
    navigational utility and effective flood control capability is to be
    maintained.
        It is estimated by the Corps of Engineers, that maintenance
    dredging of the channel to a minimum usable width requires removal of
    approximately 185,000 cubic yards at an annual cost of over $2,000,000.
    Congress is requested therefore, to appropriate $2,000,000 for annual
    silt removal. This work is included in the line item known as Los
    Angeles Long Beach Harbors in the Civil Works Budget. Please note, if
    there was a standby/training budget for Corps dredges that I earlier
    proposed, it is possible that this type of work could be more easily
    scheduled at Corps' discretion rather than via emergency provisions.
     contaminated sediment disposal (civil works budget category--general
                                investigations)
        The Contaminated Sediment Task Force, of which the Los Angeles
    District of the US Army Corps of Engineers is a key member, is charged
    with investigating the major issues involved in formulating and
    implementing a regional contaminated sediment management strategy
    including four major issues:
        1. Upland Disposal.--Blending of contaminated sediments with clean
    sediment to make structural fill as a promising disposal option.
    However, there is no quantitative data on proportions, handling
    methods, and desired end products that would support management
    decisions on disposal/reuse options. There is great need to undertake a
    pilot handling project to collect that information.
        2. Screening Guidelines.--Quantitative sediment chemistry
    guidelines are required to screen sediments for aquatic disposal and
    necessitate gathering historical regional data on sediment chemistry,
    toxicity, and bio-accumulation to be analyzed for region-specific
    relationships between sediment chemistry and toxicity.
        3. Watershed Management.--Control of future contamination via land
    runoff as a key management issue. Field and modeling study of sediment
    and contaminant transport in the Los Angeles region are required both
    to build on existing watershed efforts and to acquire specific data on
    the movement of contaminants into harbors.
        4. Aquatic Disposal.--A regional confined aquatic disposal facility
    is a promising management tool which provides a multi-user site active
    over a period of many years. The approach requires an engineering
    feasibility study of such issues as: quantifying the containment
    disposal capability, the interface chemistry between sediments of
    multiple users, and determining best management practices.
        The program would be managed by the Los Angeles District and
    requires $400,000 in Federal funding; substantial additional funding
    would come from State and local sources. Congress is therefore
    requested to appropriate $400,000 in fiscal year 2000 to support the
    Contaminated Sediment Task Force in their effort to initiate a Regional
    Contaminated Sediment Disposal Planning Study.
     feasibility study beach erosion (civil works budget category--general
                                investigations)
        The Port of Long Beach also supports C-MANC and the City of Long
    Beach on their request for federal funding to initiate a Corps of
    Engineers feasibility study on beach erosion. This beach erosion
    problem is directly related to the focusing affect the federal
    breakwater has on our large commercial harbor complex and surrounding
    beaches. In southeastern Long Beach, east of the Port's land and
    channels, and directly opposite the federal breakwater, a beach and
    seawall protects approximately $200,000,000 worth of homes based on the
    1990 US census. We expect the current home value to be significantly
    higher. Steady erosion has reduced the beach from an optimum of 175
    feet to 50 feet prior to City's efforts in late 1994 to rebuild the
    beach. Winter storms continue to reduce the beach width.
        The City has also experienced erosion in the west beach area.
    Although homes are not endangered, public improvements, including
    lifeguard stations, public restrooms, a bicycle and pedestrian trail,
    and a parking lot, are at risk. The cause of the new problem is
    unclear, indicating the need for a thorough study of the beach erosion
    problem inside the federal breakwater.
        The primary method of protecting the homes has been annual
    rebuilding of sand berms during high tides or expected storms. The City
    has invested over $5,500,000 in capital improvement projects, annual
    beach rebuilding, and storm protection to control the beach erosion
    over the past 17 years. Despite this effort, in 1989 and 1993, storm
    waves eroded the beach and breached the protective seawall, causing
    damage to homes. The City is also defending itself against a lawsuit by
    one of the homeowners who is claiming that the City failed to halt
    erosion that narrowed the beaches in front of his home to less than the
    desired width adopted in the 1980 Local Coastal Plan.
        In fiscal year 1997, $252,000 was appropriated to complete the
    reconnaissance study of the beach erosion problem within the City of
    Long Beach. It is now requested that Congress appropriate $500,000 in
    fiscal year 2000 to initiate the feasibility study.
        Attached hereto is a Resolution to be adopted by the Board of
    Harbor Commissioners of the City of Long Beach on March 22, 1998, which
    contains data relating to the background of the Los Angeles and Long
    Beach Harbors Model Study, the 2020 Plan implementation, the Los
    Angeles River dredging, the Contaminated Sediment Task Force, the beach
    erosion problem in Long Beach, and other related navigation and
    economic matters. The resolution stresses the need for federal
    assistance in developing economic, technical and environmental
    background information essential to the design and permitting of Port
    facilities vital to regional and national interests. The Port of Long
    Beach is the largest container port in the United States and is the
    economic engine bringing $3.7 billion in customs receipts from both Los
    Angeles and Long Beach ports and jobs for 500,000 people. We are truly
    a port and harbor of national significance.
        We kindly ask that Congress continue its support of these projects
    in fiscal year 2000 by appropriating the requested funds.
        Thank you for permitting me the privilege of this testimony.
                             Resolution No. HD-1958
        A resolution of the Board of Harbor Commissioners of the city of
    Long Beach, California, requesting the Congress of the United States to
    appropriate funds to the United States Army Corps of Engineers in order
    to continue planning, engineering and design for the San Pedro Bay 2020
    Plan, to continue the Los Angeles and Long Beach Harbors model study
    relating to improvements in San Pedro Bay, to conduct maintenance
    dredging at the mouth of the Los Angeles River, to conduct feasibility
    studies of beach erosion, and to develop a regional contaminated
    sediment management strategy
        WHEREAS, the Ports of Long Beach and Los Angeles in San Pedro Bay,
    California, are two of a limited number of sites on the West Coast of
    the United States which possess the potential for deep water port
    facilities as recommended in the West Coast Deep Water Port Facility
    Study conducted by the United States Army Corps of Engineers; and
    WHEREAS, the Ports of Long Beach and Los Angeles have a record of both
    physical and fiscal growth to the extent that together the two ports
    are presently handling over 185.9 million metric revenue tons including
    7.23 million twenty-foot equivalent units of container cargo annually
    (fiscal year 1998), and the international cargo handled is valued at
    over $159 billion annually (calendar year 1997); and
        WHEREAS, the growth and activity of the Ports of Long Beach and Los
    Angeles have a significant regional and national economic effect; and
        WHEREAS, in 1998 the Los Angeles Customs District remained the
    Nation's top entry and exit point for international cargo, valued at
    over $181 billion, generating approximately $3.7 billion in Federal
    revenues collected as United States Customs duties, approximately 85
    percent of which is generated by the Long Beach and Los Angeles Ports;
    and
        WHEREAS, both Ports are now, and are increasingly becoming, hard-
    pressed to provide facilities to meet the needs of the shipping
    industry, and to that end are conducting extensive studies, in
    conjunction with federal studies, to determine navigational,
    transportation, and environmental requirements necessary to provide
    economic and adequate surge-free berthing and cargo handling
    facilities; and
        WHEREAS, all existing land in the Port of Long Beach which can be
    developed for shipping operations has been utilized or is in the
    process of being developed and, in order to meet the needs of the
    following decade, the design, permitting and construction of new lands
    must continue; and
        WHEREAS, continuation of the studies currently underway by the
    United States Army Corps of Engineers, consisting of the Los Angeles
    and Long Beach Harbors Model Study, including maintenance and operation
    of the San Pedro Bay Hydraulic Model at Vicksburg, Mississippi, as
    authorized by Section 123 of the Water Resources Development Act of
    1976, is needed for use in the design and permitting processes for
    future landfills for port development; and
        WHEREAS, the Port of Long Beach handled over 27 million metric tons
    of liquid bulk cargo (fiscal year 1998). Because of economies of scale,
    liquid bulk cargo brought in by deeper draft vessels will have lower
    transportation costs and environmental benefits in the form of less
    vessel traffic. However, the existing navigation channel depths leading
    to the Port limit the size of calling vessels until such time as the
    Long Beach Deepening Project is complete; and
        WHEREAS, the Los Angeles River is the largest of numerous flood-
    control channels constructed and maintained jointly by the Los Angeles
    County Flood Control District and the United States Army Corps of
    Engineers, and silt deposit from storm runoff accumulating in the mouth
    of the Los Angeles River in the City of Long Beach constitutes a
    restriction and hazard to both commercial and recreational boating; and
        WHEREAS, the Southern California region has a significant volume of
    contaminated sediments from area runoff and other activities and the
    Los Angeles District of the US Army Corps of Engineers is a key member
    of a Task Force charged with the investigation of major issues involved
    in formulating and implementing a regional contaminated sediment
    management strategy; and
        WHEREAS, the Board of Harbor Commissioners of the City of Long
    Beach, as a properly constituted and financially responsible local
    agency, by its Resolution No. HD-890, adopted August 3, 1965, expressed
    its intent to enter into such agreements as may be reasonably required
    to further federal projects for the development and improvement of Long
    Beach and Los Angeles Harbors; and
        WHEREAS, at southeastern Long Beach in front of Alamitos Bay a
    beach and seawall protects $200 million worth of homes (1990 US census
    data). The primary method of protecting the homes has been annual beach
    rebuilding and sand berms during storms. Steady erosion has reduced the
    beach from optimum width of 175 feet to 50 feet and continues to reduce
    beach width despite rebuilding efforts in 1994. The City has invested
    over $5.5 million in capital improvement projects, annual beach
    rebuilding, and storm protection to control the beach erosion over the
    past 17 years. Despite this effort, in 1989 and 1993, storm waves
    eroded the beach and breached the protective seawall causing damage to
    homes.
        NOW, THEREFORE, the Board of Harbor Commissioners of the City of
    Long Beach resolves as follows:
        Section 1. That the Congress of the United States be, and is
    hereby, respectfully requested to appropriate simultaneously the funds
    necessary for the Chief of Engineers, United States Army Corps of
    Engineers, to maintain the San Pedro Bay Hydraulic Model at the
    Waterways Experiment Station at Vicksburg, Mississippi, as part of the
    Los Angeles and Long Beach Harbors Model Study.
        Sec. 2. That the Congress of the United States be, and is hereby,
    respectfully requested to appropriate simultaneously the funds
    necessary for the Chief of Engineers, United States Army Corps of
    Engineers, to continue the existing wave gauge (prototype) data
    acquisition and analysis program.
        Sec. 3. That the Congress of the United States be, and is hereby,
    respectfully requested to support the Chief of Engineers, United States
    Army Corps of Engineers, to complete construction of dredging deeper
    navigation channels to the Port of Long Beach to the full project
    depth.
        Sec. 4. That the Congress of the United States be, and is hereby,
    respectfully requested to appropriate simultaneously the funds
    necessary for the Chief of Engineers, United States Army Corps of
    Engineers, in conjunction with the Los Angeles County Flood Control
    District, to engage in the necessary maintenance dredging at the mouth
    of the Los Angeles River to remove silt deposits which have accumulated
    at that location.
        Sec. 5. That the Congress of the United States be, and is hereby,
    respectfully requested to appropriate simultaneously the funds
    necessary for the Chief of Engineers, United States Army Corps of
    Engineers, to complete feasibility studies to develop protective
    measures to prevent beach erosion within the City of Long Beach.
        Sec. 6. That the Congress of the United States be, and is hereby,
    respectfully requested to appropriate simultaneously the funds
    necessary for the Chief of Engineers, United States Army Corps of
    Engineers, to complete feasibility studies to develop and implement a
    regional contaminated sediment management strategy for Southern
    California.
        Sec. 7. That the Executive Director of the Long Beach Harbor
    Department be, and he is hereby, directed to send copies of this
    resolution to the United States Senators and to Members of the House of
    Representatives from California, with a letter requesting their
    assistance in presenting this resolution before the proper
    Congressional committees.
        Sec. 8. That the Executive Director of the Long Beach Harbor
    Department be, and he is hereby, further directed to send copies of
    this resolution to the President of the United States; the Director,
    Office of Management and Budget; the Secretary of the Army; the Chief
    of Engineers, the Director, Directorate of Civil Works, the Division
    Engineer-South Pacific Division and the District Engineer-Los Angeles,
    all of the United States Army Corps of Engineers; and to such other
    interested persons as he may deem appropriate.
        The Secretary of the Board shall certify to the passage of this
    resolution by the Board of Harbor Commissioners of the City of Long
    Beach, shall cause the same to be posted in three (3) conspicuous
    places in the City of Long Beach, and shall cause a certified copy of
    this resolution to be filed forthwith with the City Clerk of the City
    of Long Beach and it shall thereupon take effect.
                                     ______

    Prepared Statement of John Bridley, Waterfront Director, City of Santa
                              Barbara, California
                      operations and maintenance dredging
        As your distinguished Subcommittee writes the fiscal year 2000
    Energy and Water Resources Appropriations Bill, I would like to bring a
    very important Corps of Engineers project to your attention.
        About 400,000 cubic yards of sand piles up every winter at Santa
    Barbara Harbor, and in years of severe storms, the accumulated sand can
    close the channel bringing local fishing and other businesses in the
    Harbor to a standstill.
        There is an important Federal interest in maintaining dredging at
    the Harbor. It provides slips and moorings for over 1,100 commercial,
    emergency and recreational boats. It is also an important part of Coast
    Guard operations on California's central coast.
        The President's fiscal year 2000 Budget Request includes $1,646,000
    for operations and maintenance for Santa Barbara Harbor. I respectfully
    request that the U.S. Senate, through your Subcommittee, maintain that
    level of funding.
                  new construction project--dredge acquisition
        The President's fiscal year 2000 Budget recommendation also
    includes project funding for a potential new construction project in
    Santa Barbara. The City of Santa Barbara and the Corps of Engineers
    have pursued a proposal to design and construct a dredge for annual
    operation and maintenance dredging of our Harbor. Under this proposal,
    the City of Santa Barbara would contribute 20 percent funding
    (approximately $1.6 million) with the Corps of Engineers funding
    $4,960,000 for the acquisition of the dredge. The City would then take
    over the annual costs to operate the dredge, which are estimated to be
    $750,000-$1 million.
        Unfortunately, the recommendation to proceed with funding of this
    project cannot come at a worse time for the City. During the past year,
    the City suffered severe damage from El Nino storms causing over $1
    million in damage to the Harbor and Stearns Wharf. In November 1998,
    Stearns Wharf was hit with a catastrophic fire causing over $10 million
    in damage destroying a portion of the wharf and closing five
    businesses. The financial impacts of these natural disasters have
    severely impacted the City's ability to proceed with the dredge
    procurement and operations at this time.
        Although the City remains interested and committed to the dredge
    acquisition in the future, due to the financial hardships of the fire
    and winter storms last year, I respectfully request that the U. S.
    Senate through your Subcommittee defer funding of this project.
        Thank you for the opportunity to submit this statement.

           LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                                  ----------
                                                                       Page
    Akin, Richard, Supervisor, County of Sutter, California, prepared
      statement......................................................   598
    Alabama Electric Cooperative, Inc., prepared statement...........   622
    Allen, E.D., Chief Harbor Engineer, Port of Long Beach, prepared
      statement......................................................   861
    Allen, W. Ron, President, National Congress of American Indians,
      prepared statement.............................................   603
    American Chemical Society, prepared statement....................   821
    American Farm Bureau Federation, prepared statement..............   600
    American Public Power Association, prepared statement............   843
    American Society for Microbiology, prepared statement............   790
    American Society of Mechanical Engineers, prepared statement.....   827
    Anderson, James S., President, Blue Valley Association, prepared
      statement......................................................   727
    Anderson, Mayor Rodger, City of Morro Bay, prepared statement....   856
    Arkansas River Basin Interstate Committee, prepared statement....   701
    Armstrong, Michael D., General Manager, Monterey County Water
      Resources Agency (MCWRA), prepared statement...................   585
    Arveschoug, Steve, District General Manager, Southeastern
      Colorado Water Conservancy District, prepared statement........   704
    Association of State Dam Safety Officials, prepared statement....   609
    Audrey J. LaPlace, President, Board of Commissioners,
      Pontchartrain Levee District, Lutcher, LA, prepared statement..   681

    Baldwin, Dr. David E., Senior Vice President, General Atomics, et
      al., prepared statement........................................   799
    Ballard, Lt. Gen. Joe N., Chief of Engineers, Corps of
      Engineers--Civil, Department of the Army, Department of
      Defense--Civil.................................................    63
        Prepared statement...........................................    82
        Statement of.................................................    79
    Barnett, Jack A., Executive Director, Colorado River Basin
      Salinity Control Forum, prepared statement.....................   766
    Barrett, Lake H., Acting Director, Office of Civilian Radioactive
      Waste Management, Environmental Management and Civilian Waste
      Management Programs, Department of Energy......................   269
        Prepared statement...........................................   297
        Statement of.................................................   294
    Beachem, Philip, Chairman, New Jersey Maritime Advisory Council,
      letter from....................................................   612
    Beier, Keith E., Mayor Pro Tem, City of Escondido, California,
      prepared statement.............................................   556
    Belza, Tib, Chairman, Yuba County Water Agency, prepared
      statement......................................................   567
    Beneke, Patricia, Assistant Secretary of the Interior, Water and
      Science, Bureau of Reclamation, Department of the Interior.....     1
        Prepared statement...........................................     5
        Statement of.................................................     3
    Bennett, Hon. Robert F., U.S. Senator from Utah:
        Questions submitted by.......................................   168
        Statement of.................................................    15
    Biggs, Otha Lee, Judge of Probate & President, Monroe County
      Commission, Monroeville, AL, prepared statement................   637
    Blum, Carl L., Deputy Director, Department of Public Works, Los
      Angeles County, California, prepared statement.................   579
    Bollinger, Donald T., Chairman, Louisiana Governor's Task Force
      on Maritime Industry, prepared statement.......................   656
    Borrone, Lillian C., Director, Port Commerce Department of the
      Port Authority of New York & New Jersey, prepared statement....   615
    Boyd, Bernadine, President, Fort McDowell Tribal Council, Fort
      McDowell Indian Community, prepared statement..................   761
    Brakken, William A., Community Liaison/Central Oregon Team
      Leader, Northwest Area Foundation, prepared statement..........   778
    Bransford, Donald, President, Glenn-Colusa Irrigation District,
      prepared statement,............................................   547
    Brescia, Christopher J., President, Midwest Area River Coalition
      2000, prepared statement.......................................   713
    Bridley, John, Waterfront Director, City of Santa Barbara,
      California, prepared statement.................................   865
    Brinson, J. Ron, President and Chief Executive Officer, Port of
      New Orleans, New Orleans, LA, prepared statement...............   667
    Brown, Lynne P., Ph.D., Associate Vice President for Government
      and Community Relations, Center for Cognition, Learning,
      Emotion and Memory, New York University, prepared statement....   802
    Burns, Hon. Conrad, U.S. Senator from Montana:
        Questions submitted by

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisorn and Sales,
    U.S. Steel, Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisorrepared statement

    614____________________________________________________________________

    Jansen, Keith H., Director, Raw Materials Planning Procurement Distribution
    and Sales, U.S. Steel, Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisorional Water Pollution
    Control Agency (MRWPCA), prepared statement

    587____________________________________________________________________

    James, Hon. Sharpe, Mayor, City of Newark, New Jersey, prepared statement

    614____________________________________________________________________

    Jansen, Keith H., Director, Raw Materials Planning Procurement Distribution
    and Sales, U.S. Steel, Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisor, Raw
    Materials Planning Procurement Distribution and Sales, U.S. Steel,
    Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisord statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisorith H., Director,
    Raw Materials Planning Procurement Distribution and Sales, U.S. Steel,
    Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisorrepared statement

    614____________________________________________________________________

    Jansen, Keith H., Director, Raw Materials Planning Procurement Distribution
    and Sales, U.S. Steel, Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisorional Water Pollution
    Control Agency (MRWPCA), prepared statement

    587____________________________________________________________________

    James, Hon. Sharpe, Mayor, City of Newark, New Jersey, prepared statement

    614____________________________________________________________________

    Jansen, Keith H., Director, Raw Materials Planning Procurement Distribution
    and Sales, U.S. Steel, Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisorn and Sales,
    U.S. Steel, Pittsburgh, PA, prepared statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisor

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisord statement

    631____________________________________________________________________

    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar Energy
    Industries Association (SEIA), prepared statement

    832____________________________________________________________________

    Jollivette, Cyrus M., Vice President for Government Relations, University
    of Miami, prepared statement

    644____________________________________________________________________

    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from

    638____________________________________________________________________

    Joseph, William F., Jr., Chairman, Montgomery County Commission,
    Montgomery, AL, prepared statement

    637____________________________________________________________________

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas Municipal Water
    District, prepared statement

    581____________________________________________________________________

    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement

    744____________________________________________________________________

    King, T. Keith, P.E., President and CEO, David Volkert & Associates, Inc.,
    Mobile, AL, prepared statement

    631____________________________________________________________________

    Klass, Dr. Donald L., President, Biomass Energy Research Association,
    prepared statement

    833____________________________________________________________________

    Knabe, Don, Chairman of the Board, Supervisor

        Statement of.................................................    29
    Business Council For Sustainable Energy, prepared statement......   817
    Byrd, Hon. Robert C., U.S. Senator from West Virginia, questions
      submitted by...................................................   178
    Byrnes, Robert J., Mayor, City of Marshall, MN, prepared
      statement......................................................   738

    Caddo/Bossier Port Commission, Shreveport, LA, prepared statement   698
    Campbell, Joseph L., President, Board of Directors, Contra Costa
      Water District, prepared statement,............................   546
    Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado,
      statement of...................................................   270
    Castro, Richard, Chairman, El Paso Water Utilities Public Service
      Board, prepared statement......................................   748
    Cherokee Canal, Sediment Removal and Streambed Alteration
      Project, Butte County, prepared statement,.....................   568
    City of Gridley, CA, prepared statement..........................   838
    City of Miami Beach, Florida, prepared statement.................   649
    City of Stockton, California, prepared statement.................   574
    Clemens, Ralph O., Jr., President, Coosa-Alabama River
      Improvement Association, Inc., prepared statement..............   634
    Coachella Valley Water District, prepared statement..............   549
    Cochran, Hon. Thad, U.S. Senator from Mississippi, questions
      submitted by.................................................165, 381
    Colvin, Joe F., President and Chief Executive Officer, Nuclear
      Energy Institute, prepared statement...........................   814
    Corbett, Kevin S., Executive Director, Port Authority Affairs,
      State of New York, Empire State Development Corporation,
      prepared statement.............................................   615
    County of San Joaquin and the San Joaquin County Flood Control
      and Water Conservation District, California, prepared statement   557
    Craig, Hon. Larry, U.S. Senator from Utah, questions sub, 173, 265, 501
    Curry, Darrel G., Vice President, Missouri River Bank
      Stabilization Association, prepared statement..................   728

    DeCosmo, James M., Manager of Lands, Research and Procurement,
      Southeast Timberlands, Kimberly-Clark, Mobile, AL, prepared
      statement......................................................   626
    Delesdernier, Capt. Mark, Jr., President, Crescent River Port
      Pilots' Association, Belle Chasse, LA, prepared statement......   670
    Department of Water and Power, City of Los Angeles, prepared
      statement......................................................   568
    DiGiorgio, Michael, Mayor, City of Novato, California, prepared
      statement......................................................   589
    Domenici, Hon. Pete V., U.S. Senator from New Mexico:
        Opening statement............................................   383
        Questions submitted by............................35, 117, 246, 337
    Dorgan, Hon. Byron L., U.S. Senator from North Dakota:
        Questions submitted by..................................., 190, 521
        Statement of.................................................   387
    Dry Prairie Rural Water, prepared statement......................   785
    Duffy, George E., President, Navios Ship Agencies, Inc., Mobile,
      AL, prepared statement.........................................   627

    Evans, Mayor Donna, City of West Jordan, Utah, prepared statement   783

    Farris, Chester A., III, Chairman, Photovoltaics Division, Solar
      Energy Industries Association (SEIA), prepared statement.......   830
    Felty, Billy J., Chief Engineer, St. Francis Levee District of
      Arkansas, prepared statement...................................   677
    Fort Peck Assiniboine and Sioux, prepared statement..............   785
    Foss, Brian E., Port Director, Santa Cruz Port District
      Commission, prepared statement.................................   859
    Foster, Gov. M.J., Jr., on Behalf of the Louisiana Department of
      Transportation and Development, Office of Public Works and
      Intermodal Transportation, prepared statement..................   671
    Fraser, Gale Wm., II, P.E., General Manager/Chief Engineer, Clark
      County Regional Flood Control District, prepared statement.....   755
    Fuhrman, Maj. Gen. Russell L., Director of Civil Works, Corps of
      Engineers--Civil, Department of the Army, Department of
      Defense--Civil.................................................    63
    Futter, Dr. Ellen, President, American Museum of Natural History,
      prepared statement.............................................   793

    George, Bruce, Manager, Kaweah Delta Water Conservation District,
      prepared statement.............................................   588
    George, Merv, Jr., Chairman, Hoopa Valley Tribe, prepared
      statement......................................................   775
    Geringer, Hon. Jim, Governor, State of Wyoming, prepared
      statement......................................................   788
    Gieringer, Wallace A., Chairman for Arkansas, Arkansas River
      Basin Interstate Committee, prepared statement.................   702
    Gottemoeller, Rose E., Director, Office of Nonproliferation and
      National Security, Atomic Energy Defense and Nonproliferation
      Programs, Department of Energy.................................   193
        Prepared statement...........................................   210
        Statement of.................................................   207
    Gravois, Aubrey, President, Board of Commissioners, Lafourche
      Basin Levee District, Vacherie, LA, prepared statement.........   676
    Green, Peter, Mayor, City of Huntington Beach, California,
      prepared statement.............................................   857

    Haak, Norman, Chairman, Garrison Diversion Conservancy District,
      prepared statement.............................................   729
    Haun, Charles A., Executive Vice President, Parker Towing
      Company, Inc., Tuscaloosa, AL, prepared statement..............   628
    Hayden, Channing F., Jr., President, Steamship Association of
      Louisiana, prepared statement..................................   663
    Henderson, Ed, Chairman, Napa County Flood Control and Water
      Conservation District, prepared statement......................   570
    Henry, Allen, President, Henry Marine Service, Inc., Spanish
      Fort, Alabama, prepared statement..............................   625
    Hewgley, James M., Jr., Chairman for Oklahoma Arkansas River
      Basin Interstate Committee, prepared statement.................   709
    Hodges, James H., Governor, State of South Carolina, Columbia,
      SC, prepared statement.........................................   642
    Hodges, William D., President, Board of Directors, Trinity River
      Authority of Texas, prepared statement.........................   748
    Holgate, Laura S.H., Director, Office of Fissile Materials
      Disposition, Atomic Energy Defense and Nonproliferation
      Programs, Department of Energy.................................   193
        Prepared statement...........................................   217
        Statement of.................................................   214
    Holland, Lisa S., Chair, Association of State Floodplain
      Managers, Inc., prepared statement.............................   611
    Hollingsworth, Tom, Mayor, City of Rancho Palos Verdes,
      California, prepared statement.................................   598
    Holman, Gerald H., Chairman for Kansas, Arkansas River Basin
      Interstate Committee, prepared statement.......................   706
    Hunter, Dr. Sam M., President, Little River Drainage District,
      prepared statement.............................................   725

    Israel, Keith, General Manager, Monterey Regional Water Pollution
      Control Agency (MRWPCA), prepared statement....................   587

    James, Hon. Sharpe, Mayor, City of Newark, New Jersey, prepared
      statement......................................................   614
    Jansen, Keith H., Director, Raw Materials Planning Procurement
      Distribution and Sales, U.S. Steel, Pittsburgh, PA, prepared
      statement......................................................   631
    Johansson, Lennart, Chairman, Solar Thermalpower Division, Solar
      Energy Industries Association (SEIA), prepared statement.......   832
    Jollivette, Cyrus M., Vice President for Government Relations,
      University of Miami, prepared statement........................   644
    Jordan, James T., Director, J.T. Jordan Cotton, Inc., letter from   638
    Joseph, William F., Jr., Chairman, Montgomery County Commission,
      Montgomery, AL, prepared statement.............................   637

    Kendall, Donald R., Ph.D., P.E., General Manager, Calleguas
      Municipal Water District, prepared statement...................   581
    Kimble, Jay L., Mayor, City of Stillwater, MN, prepared statement   744
    King, T. Keith, P.E., President and CEO, David Volkert &
      Associates, Inc., Mobile, AL, prepared statement...............   631
    Klass, Dr. Donald L., President, Biomass Energy Research
      Association, prepared statement................................   833
    Knabe, Don, Chairman of the Board, Supervisor, Fourth District,
      County of Los Angeles, prepared statement......................   852
    Kornegay, H. Thomas, Executive Director, Port of Houston
      Authority, prepared statement..................................   749
    Krebs, Dr. Martha, Director, Office of Science, Department of
      Energy.........................................................   383
        Prepared statement...........................................   393
        Statement of.................................................   388
    Krygsman, Alexander, Director, Port of Stockton, prepared
      statement......................................................   855

    LaGrange, Gary P., Executive Director/CEO, Port of South
      Louisiana, LaPlace, LA, prepared statement.....................   667
    Langjahr, Joseph H., Vice President and General Counsel, Foss
      Maritime, letter from..........................................   624
    LaPlace, Aubrey J., President, Board of Commissioners,
      Pontchartrain Levee District, Lutcher, LA, prepared statement..   683
    Lee, Jan, Executive Director, Oregon Water Resources Congress,
      prepared statement.............................................   781
    Lema, Joseph E., Vice President, Manufacturers and Services
      Division, National Mining Association, prepared statement......   653
    LeVake, Barbara, President, the Resources Agency and the
      Reclamation Board, State of California, prepared statement,....   542
    Levine, John L., Jr., President, Associated Branch Pilots,
      Metairie, LA, prepared statement...............................   669
    Libeu, Larry, President, Western Coalition of Arid States
      (WESTCAS):
        Letter from..................................................   595
        Prepared statement...........................................   768
    Lopez, Gaye, Manager, Colusa Basin Drainage District, prepared
      statement......................................................   545
    Losoya, Milton, Mayor, City of Woodland, prepared statement......   551
    Lowe, A. Lynn, President, Red River Valley Association, prepared
      statement......................................................   688
    Lyon, Dick, Mayor, City of Oceanside, CA, prepared statements..580, 857

    Mackey, Karan, Chair, Board of Supervisors, County of Lake,
      California, prepared statement.................................   597
    Madigan, Michael D., Chairman, California Water Commission,
      prepared statement.............................................   525
    Magwood, Bill, Director, Office of Nuclear Energy, Science and
      Technology, Department of Energy...............................   383
        Prepared statement...........................................   419
        Statement of.................................................   415
    Martin, William, Chairman, Tumalo Irrigation District, prepared
      statement......................................................   783
    Martinez, Eluid, Commissioner, Bureau of Reclamation, Bureau of
      Reclamation, Department of the Interior........................     1
        Prepared statement...........................................     8
        Statement of.................................................     7
    Mauderly, Joe L., Senior Scientist and Director of External
      Affairs, The Lovelace Respiratory Research Institute, prepared
      statement......................................................   796
    McClelland, John S., Jr., Midstream Fuel Service, Inc., Mobile,
      AL, prepared statement.........................................   626
    McConnell, Hon. Mitch, U.S. Senator from Kentucky, questions
      submitted by...................................................   495
    McCrory, Robert L., Professor and Director, Laboratory for Laser
      Energetics, University of Rochester, prepared statement........   807
    McDonough, Frank M., Executive Director, New Jersey Maritime
      Resources, State of New Jersey, Commerce & Economic Growth
      Commission, prepared statement.................................   615
    McKenzie Watershed Council, prepared statement...................   782
    Melton, Carlton J., Regional Vice President, Gulf & Inland
      Region, Stevedoring Services of America, Mobile, AL, prepared
      statement......................................................   630
    Merrihew, Lawrence L., Senior Vice President, Regions Bank,
      Mobile, AL, prepared statement.................................   629
    Metropolitan Water District of Southern California, prepared
      statement......................................................   592
    Mikels, Jon D., Chairman, Supervisor, Second District, County of
      San Bernardino, prepared statement.............................   552
    Miklos, Mayor Steve, City of Folsom, California, prepared
      statements...................................................595, 597
    Miller, Chairman Harold, Chairman, Crow Creek Sioux Tribe,
      prepared statement.............................................   741
    Miller, George, Mayor, City of Tucson, prepared statement........   758
    Milnes, Dwane, Executive Director, San Joaquin Area Flood Control
      Agency and City Manager, City of Stockton, California, prepared
      statement......................................................   846
    Minnesota-Wisconsin Boundary Area Commission, prepared statement.   747
    Minsky, Reynold S., President, Board of Commissioners, Fifth
      Louisiana Levee District, Tallulah, LA, prepared statement.....   680
    Mni Wiconi Project, prepared statement...........................   733
    Morgan, Carl, President, Economic Development Authority, Selma,
      AL, prepared statement.........................................   640
    Morgan, Sheldon L., President, Warrior-Tombigbee Waterway
      Association, prepared statement................................   620
    Mosher, Carl W., Director, Environmental Services Department,
      City of San Jose, California, prepared statement...............   547
    Murray, Hon. Patty, U.S. Senator from Washington, questions
      submitted by...................................................   188

    National Waterways Alliance, prepared statement..................   599
    Nelson, Les, Chairman, Solar Thermal & Building Products
      Division, Solar Energy Industries Association (SEIA), prepared
      statement......................................................   831
    Nelson, Ron, Chairman, Deschutes Basin Resources Conservancy,
      prepared statement.............................................   779
    Noble, Vernon A., Chairman, Green Brook Flood Control Commission,
      prepared statement.............................................   619
    Northwest Power Planning Council, prepared statement.............   770
    Nuisance Flooding Near the 3B's Portion of the Butte Basin
      Overflow, Sacramento River, Butte County, California, prepared
      statement......................................................   568

    O'Brien, Terrence J. President, Metropolitan Water Reclamation
      District of Greater Chicago, prepared statement................   699
    Orillion, Wayne, President, Board of Commissioners, Atchafalaya
      Basin Levee District, Port Allen, LA, prepared statement.......   678
    Owendoff, James M., Acting Assistant Secretary for Environmental
      Management, Environmental Management and Civilian Waste
      Management Programs, Department of Energy......................   269
        Prepared statement...........................................   273
        Statement of.................................................   271

    Pace, W.O., Chairman, Autauga County Commission, letter from.....   639
    Palmer, R. Barry, Executive Director, DINAMO, prepared statement.   651
    Parsons, Richard W., Dredging Program Manager, Ventura Port
      District, prepared statement...................................   854
    Perrenot, Frederick A., P.E., General Manager, City of Houston,
      prepared statement.............................................   752
    Peterson, J. M., President, Missouri River Bank Stabilization
      Association, prepared statement................................   728
    Peterson, R. Max, Executive Vice President, International
      Association of Fish and Wildlife Agencies, prepared statement..   606
    Pettygrove, Hon. George, Mayor, City of Fairfield, California,
      prepared statements..........................................551, 596
    Pfeifle, Kurt, General Manager, Mid-Dakota Rural Water Project
      (Public Law 102-575), prepared statement.......................   729

    Rabbon, Peter D., General Manager, the Resources Agency and the
      Reclamation Board, State of California, prepared statement.....   542
    Ravan, Jack E., Director and Chief Executive Officer, Alabama
      State Docks Department, Mobile, AL, prepared statement.........   633
    Red River Waterway Commission, Natchitoches, LA, prepared
      statement......................................................   698
    Reicher, Dan, Assistance Secretary, Office of Energy Efficiency
      and Renewable Energy, Department of Energy:
        Prepared statement...........................................   449
        Statements of..............................................383, 438
    Reid, Hon. Harry, U.S. Senator from Nevada:
        Prepared statement...........................................     3
        Questions submitted by.....................................176, 509
        Statements of...........................................2, 194, 384
    Reis, Dr. Victor H., Assistant Secretary, Office of Defense
      Programs, Atomic Energy Defense and Nonproliferation Programs,
      Department of Energy...........................................   193
        Prepared statement...........................................   198
        Statement of.................................................   195
    Renner, George, President, Board of Directors, Central Arizona
      Water Conservation District, prepared statement................   757
    REPI Action Coalition, prepared statement........................   842
    Richard, Roger P., Executive Director, Port of Greater Baton
      Rouge, Port Allen, LA, prepared statement......................   668
    Richmond, George R., President and Chief Operating Officer, Jim
      Walter Resources, Inc., letter from,...........................   632
    Rimsza, Skip, Mayor, City of Phoenix, prepared statement.........   764
    Rogers, Ross, General Manager, Merced Irrigation District,
      prepared statement.............................................   550
    Rousselle, Benny, Plaquemines Parish Government, Belle Chasse,
      LA, prepared statement.........................................   669

    Sacramento Area Flood Control Agency, prepared statement.........   846
    San Diego, California, Water Reclamation Program, prepared
      statement......................................................   564
    Sanguinotti, Phillip A., President, The Anniston Star, Anniston,
      AL, prepared statement.........................................   636
    Santa Clara Valley Water District, San Jose, California, prepared
      statement......................................................   559
    Schafer, R. L., District Engineer, Cawelo Water District,
      Bakersfield, California, prepared statement....................   569
    Schafer, R. L., Secretary/Watermaster, Tule River Association,
      Porterville, California, prepared statement....................   569
    Seminole Tribe of Florida, prepared statement....................   647
    Serna, Joe, Jr., Mayor, City of Sacramento, California, prepared
      statement......................................................   590
    Sherrill, Lynn, Vice President, Operations, Crounse Corporation,
      Paducah, KY, prepared statement................................   623
    Smith, Jimmy, Commission President, Humboldt Bay Harbor,
      Recreation and Conservation District, Eureka, California,
      prepared statement.............................................   859
    Smith, Sandy, Executive Director, Monroeville Area Chamber of
      Commerce, Monroeville, AL, prepared statement..................   637
    Stein, Theodore, Jr., Commission President, Port of Los Angeles
      Board of Harbor Commissioners, prepared statement..............   850
    Stepan, J. Craig, General Manager, Warrior & Gulf Navigation
      Company, Chickasaw, AL, prepared statement.....................   632
    Steve, Jaime, Legislative Director, American Wind Energy
      Association, prepared statement................................   822
    Stevens, Hon. Ted, U.S. Senator from Alaska:
        Questions submitted by.......................................   520
        Statement of.................................................    63
    Stewart, Jerry L., Vice President Fuel Services, Southern Company
      Generation, letter from........................................   629
    Story, Charles, Vice President Governmental & Public Affairs,
      Degussa-Huls, Theodore, AL, prepared statement.................   624
    Sublette, Kerry L., Sarkeys Professor of Environmental
      Engineering, University of Tulsa, prepared statement...........   804
    Svendson, Douglass W., Jr., Executive Director, Gulf Intracoastal
      Canal Association, prepared statement..........................   752

    Thomas, Fred, Sr., Chairman, Pikitanoi Rural Water Supply System,
      Kickapoo Tribe, prepared statement.............................   718
    Thompson, Michael D., President, Thompson Power Systems,
      Birmingham, AL, prepared statement.............................   630

    U.S. Army Corps of Engineers, prepared statement.................   621
    University of Medicine and Dentistry of New Jersey, prepared
      statement......................................................   810
    Upper Mississippi River Basin Association, prepared statement....   722

    Vann, James A., Jr., President and Chief Executive Officer,
      Alabama Electric Cooperative, Inc., Andalusia, AL, prepared
      statement......................................................   622
    Vanselow, Glenn, Executive Director, Pacific Northwest Waterways
      Association, prepared statement................................   773
    Venable, Jim, Chairman, Board of Supervisors, Riverside County
      Flood Control and Water Conservation District, prepared
      statement......................................................   576
    Volusia County, Florida, prepared statement......................   646

    Waldon, Donald G., Administrator, Tennessee-Tombigbee Waterway
      Development Authority, Columbus, MS, prepared statement........   640
    Waldron, Marie, Council Member, City of Escondido, California,
      prepared statement.............................................   556
    Wallace, James D., President, Selma and Dallas County Chamber of
      Commerce, Selma, AL, prepared statement........................   639
    Wanamaker, James E., Chief Engineer, Board of Mississippi Levee
      Commissioners, prepared statement..............................   686
    Wehe, Prof. David K., University of Michigan, prepared statement.   839
    Weiland, Kenneth L., P.E., CEO and Chief Engineer, Yazoo-
      Mississippi Delta (YMD) Levee Board, prepared statement........   683
    West, Carol W., Executive Director, Tucson Regional Water
      Council, prepared statement....................................   764
    Westphal, Dr. Joseph W., Assistant Secretary of the Army for
      Civil Works, Corps of Engineers--Civil, Department of the Army,
      Department of Defense--Civil:
        Prepared statement...........................................    68
        Statements of................................................63, 65
    Whetstone, Mayor David D., Jr., letter from......................   638
    White, M. Dean, Port Captain, Orsouth Midland Enterprises,
      Orsouth Transport Co., letter from.............................   628
    Wilk, J. Tim, Hunt Crude Oil Supply Co., Tuscaloosa, AL, prepared
      statement......................................................   625
    Williams, M.V., President, West Tennessee Tributaries
      Association, Friendship, TN and Chairman, Executive Committee,
      Mississippi Valley Flood Control Association, prepared
      statement......................................................   674
    Wiseman, Glenwood W., Executive Director, Lake Charles Harbor &
      Terminal District, Lake Charles, LA, prepared statement........   668
    Wolf, George E., Jr., P.E., Assistant City Manager/Director of
      Public Works, Kansas City, Missouri, prepared statement........   717

    Zieschang, Ernie, President, Port of Liberty Commission, prepared
      state-
      ment...........................................................   754

                                 SUBJECT INDEX

                                  ----------

                              DEPARTMENT OF ENERGY

              Atomic Energy Defense and Nonproliferation Programs

                                                                       Page
    Advanced driver development......................................   250
    Aging nuclear scientists of concern..............................   235
    BN-600 reactor...................................................   266
    Budget request, sufficiency of...................................   234
    Canadian reactors................................................   265
    Chemical and biological:
        Threats......................................................   212
        Weapons......................................................   209
    Chemistry and Metallurgical Research (CMR) building upgrade......   255
    Chiles Commission Report.........................................   246
        Recommendations..............................................   223
    Chinese nuclear weapons..........................................   245
    Comprehensive Test Ban Treaty....................................   234
    Contamination:
        Explosive testing............................................   226
        Resulting from explosive testing.............................   226
    Core technologies and NEPA compliance............................   221
    Critical needs not addressed in budget...........................   223
    Declassification initiative......................................   213
    Domestic security..............................................209, 244
    Emergency management.............................................   210
    Emergency response...............................................   213
        Capability...................................................   228
    Environmental Safety Center......................................   232
    Environmental Surety Program.....................................   231
    Experimental facilities, progress on major.......................   204
    Experimental programs............................................   202
    50 Tons, Definition of...........................................   263
    Fiscal year:
        1999 emergency supplemental appropriation....................   216
        2000 budget request........................................210, 214
    Fissile material storage, surplus................................   221
    GAS U.S.-Russian reactor technology development..................   216
    Idaho Operations Office..........................................   256
    Immobilization...................................................   218
    Independent project review.......................................   254
    Initiatives for Proliferation Prevention (IPP), GAO Report on..241, 260
    International nuclear safety.....................................   208
        Cooperation..................................................   212
    Kazakhstan BN-350 activities.....................................   266
    Manufacturing capabilities.......................................   200
    Material Protection, Control and Accounting [MPC&A].......207, 211, 259
    Mixed oxide fuel fabrication and irradiation services............   219
    MOX vs. Vitrification............................................   264
    National Ignition Facility.......................................   249
    National security challenges.....................................   212
    New construction projects........................................   243
    New weapons, production of.......................................   240
    Nonproliferation technology......................................   265
    Nuclear Cities Initiatives (NCI)..........................243, 262, 266
    Nuclear:
        Emergency Response and Technology Partnerships programs......   205
        Emergency Response Program...................................   228
        Power plant in Cuba, status of...............................   237
        Smuggling....................................................   229
        Weapons stockpile, condition of the..........................   246
            Russia's production of...................................   242
    Office of Counterintelligence fiscal year 2000 budget request....   257
    Parallel U.S. and Russia Programs................................   263
    Pit:
        Disassembly and conversion...................................   218
        Production, reestablishing.................................241, 252
    Plutonium disposition:
        Activities, budget request summary for.......................   220
        Progress with Russia on......................................   239
    Presidential Initiative..........................................   258
    Prior year balances, use of......................................   257
    Production plants and labs funding, balance of...................   223
    Program:
        Direction....................................................   222
        Integration..................................................   206
    Proliferation prevention and nuclear cities initiative (IPP),
      initiatives for....................................208, 212, 229, 261
    RBMK reactors....................................................   224
    Research and development.........................................   213
    Russia:
        Cooperative efforts with.....................................   237
        Nuclear power plants in......................................   224
        Work with....................................................   220
    Russian:
        Assistance to Iran, concern about............................   235
        Breeder reactors.............................................   233
        Naval fuel assistance........................................   232
        Navy Fleet...................................................   266
        Plutonium disposition......................................219, 239
        Talks, status of.............................................   262
    Schedule.........................................................   265
    Simulation and computation.......................................   204
    Skilled workers, attract and maintain............................   227
    START II.........................................................   236
    Stewardship:
        Lab missions flow from.......................................   196
        Production complex response to...............................   197
    Stockpile:
        Life extension and surveillance..............................   200
        Management, Funding for......................................   251
        Safety reliability and security..............................   222
        Stewardship..................................................   247
            Challenge, meeting the...................................   195
            Interagency coordination.................................   198
            Is working, how..........................................   199
        Y2K concerns.................................................   225
    Surplus:
        Nuclear materials threat.....................................   222
        Plutonium disposition summary................................   217
    Test readiness, maintaining......................................   226
    Tritium..........................................................   202
        Production............................................197, 237, 252
    U.S.-Russia plutonium agreement................................215, 225
    Uranium disposition, highly enriched.............................   221
    Weapons activities, funding for..................................   246
    Y2K impact on Chernobyl-type reactors............................   224

        Environmental Management and Civilian Waste Management Programs

    Accomplishments..................................................   345
        Fiscal year 1998-fiscal year 1999............................   299
            Major program............................................   308
        Progress--cleaning up and closing sites......................   274
    Actinide packaging and storage facility..........................   374
    Advanced mixed waste treatment project (AMWTP)...................   363
    Cleanup:
        Budget.......................................................   362
        Complex-wide integration to support..........................   279
        Estimated cost of............................................   318
        Level of.....................................................   319
        Outyear funding requirements for.............................   331
        Program to Corps of Engineers, impact of transferring........   347
        Progress toward completing...................................   277
    Comprehensive Environmental Response, Compensation, and Liability
      Act (CERCLA) Cleanup at DOE Sites..............................   344
    Defense spent fuel and waste.....................................   331
    DOE:
        Cleanup Program, cost of...................................339, 344
        Cleanup with previous estimates, comparison of cost of.......   318
    DWPF, canister production at.....................................   377
    Earthquake threats...............................................   314
    EM Program, the fiscal year 2000 request reflects the evolution
      of the.........................................................   275
    Environmental legacy, meeting the challenge of the...............   274
    Environmental Management Centers.................................   379
    EPA groundwater standard.........................................   320
    External oversight and payments-equal-to-taxes...................   339
    Fiscal year:
        2000 budget request........................................272, 296
            Application of the.......................................   302
            Summary of the.........................................280, 299
        2001, funding requirements for...............................   320
    FUSRAP sites.....................................................   319
    Groundwater:
        Contamination................................................   321
        Potential problems...........................................   336
    Hanford:
        Activities...................................................   272
        Reprogramming/EM Program accountability and control..........   355
        Site.........................................................   365
            Budget.................................................317, 322
            Manager..................................................   317
    Heavy water, processing of.......................................   377
    Idaho National Engineering & Environmental Laboratory..........330, 362
        Long-range plan at...........................................   334
    Idaho, shipment of transuranic waste out of......................   328
    In-tank precipitation project (ITP)..............................   375
    Integration effort, complex-wide.................................   335
    Jack Ass Flats radiation exposure................................   335
    Litigation.......................................................   298
    Local government, payments to the State and affected units of....   299
    Los Alamos Environmental Restoration Program.....................   354
    Management reforms...............................................   276
    Nuclear waste, costs of transporting.............................   337
    Oak Ridge National Laboratory....................................   377
    On-site:
        Disposal, costs to set up....................................   336
        Storage costs................................................   332
            Alternative options to...................................   338
            Maintenance costs of.....................................   337
            Nuclear regulatory commission............................   334
            Regulatory concerns for..................................   333
            Utility compensation for.................................   332
    Pit 9:
        At Inel......................................................   329
        Project......................................................   364
    Plutonium oxide stabilization....................................   315
    Program goals and progress.......................................   271
    Program management and integration........................302, 306, 311
    Quality assurance................................................   299
    Recent accomplishments...........................................   295
    Rock fractures...................................................   313
    Rocky Flats:
        Additional workload at.......................................   315
        Alternatives for storage at..................................   326
        Cleanup......................................................   361
        Funding......................................................   324
        Site.........................................................   323
        Storage of waste at..........................................   315
    S-608............................................................   334
    Savannah River site..............................................   373
    Science and technology....................................278, 358, 381
    Spent Nuclear Fuel:
        On-site interim storage of...................................   337
        Programs.....................................................   329
    Tank waste remediation system (TWRS).............................   367
        Privatization................................................   317
            Project..................................................   320
    Three Mile Island fuel storage...................................   329
    Transuranic waste................................................   316
    2006 completion, funding for.....................................   361
    Viability assessment...........................................295, 297
    Waste acceptance, storage, and transportation.............301, 306, 311
    Waste Isolation Pilot Plant (WIPP)........................322, 352, 381
        Costs associated with delay in opening.......................   326
        Lawsuit at...................................................   316
        Opening......................................................   362
        Project......................................................   272
        Shipping non-mixed waste to..................................   326
    Work requirements, additional....................................   324
    Yucca Mountain............................................299, 302, 308
        Milestones, acceleration of..................................   338
        Schedule.....................................................   295
        Site, total spent at the.....................................   336
        Water migration..............................................   312

                Office of Energy Efficiency and Renewable Energy

    Appropriated funding, appropriate use of.........................   469
    Biofuels programs................................................   440
    Biopower/biofuels................................................   461
    Carbon fuel tax..................................................   471
    Electric energy systems and storage..............................   467
    Fiscal year 2000 budget request..................................   447
    Geothermal energy................................................   465
    Hydrogen.........................................................   466
    Hydropower.......................................................   466
    International Solar Energy Program...............................   468
    Kyoto accord.....................................................   471
    National Renewable Energy Laboratory.............................   464
    Photovoltaic.....................................................   439
        Energy systems...............................................   457
    Program accomplishments..........................................   439
    Renewable Energy Production Incentive Program....................   463
    Renewable energy technologies....................................   385
    Solar and renewable energy technologies, overview of the fiscal
      year 2000 request for..........................................   455
    Solar building technology research...............................   456
    Solar Power Program:
        Concentrating................................................   459
        Direction....................................................   469
        Support......................................................   463
    Sole source vs. competitively awarded grants.....................   448
    Superconductivity................................................   447
    Wind energy systems..............................................   460

                Office of Nuclear Energy, Science and Technology

    Accelerator transmutation of waste...............................   492
    Advanced radioisotope power systems..............................   427
    Department of Energy, developing...............................422, 424
    EBR-II...........................................................   475
    Energy diversity and security, providing for.....................   420
    Environmental future, securing our...............................   426
    Fast flux test facility [FFTF].................................433, 475
    Isotope support..................................................   431
    Maintaining vital nuclear research facilities and supporting a
      strong educational infrastructure..............................   424
    Mission critical technologies....................................   422
    Moly-99 program..................................................   474
    Nuclear energy plant optimization................................   417
        Advisory committee...........................................   418
        Program....................................................429, 476
    Nuclear energy research:
        Advisory committee...........................................   475
        And development (R&D)......................................416, 427
    Nuclear Energy Research Initiative [NERI].................417, 429, 473
    Nuclear energy, science and technology...........................   415
    Nuclear power, importance of.....................................   437
    Nuclear powerplant relicensing...................................   473
    Program direction................................................   435
    Roadmap for the 21st century.....................................   420
    Termination costs................................................   433
    Test reactor area landlord.......................................   428
    University reactor fuel assistance and support...................   430
    Uranium programs.................................................   434

                               Office of Science

    Bates Laboratory funding.........................................   491
    Biological and environmental research............................   404
    Climate change:
        Budget request...............................................   384
        Technology initiative........................................   492
    Computational and technology research............................   411
    Employment levels................................................   486
    Energy research analyses.........................................   413
    Energy supply R&D programs.......................................   414
    Facilities support...............................................   412
    Field structure..................................................   487
    Fiscal year 2000 budget request..................................   390
    Fusion energy sciences...........................................   410
    GAO study........................................................   392
    Goals and strategies, rethinking our.............................   395
    High energy physics..............................................   406
    High flux beam reactor...........................................   490
    Human genome projects............................................   387
    Low dose radiation research......................................   488
    Multi program energy laboratories................................   412
    Nuclear energy programs..........................................   386
    Nuclear physics..................................................   409
    Our mission hasn't changed.......................................   394
    Potential programmic problem areas...............................   493
    Program accomplishments..........................................   390
    Program overview.................................................   389
    Sandia, micro-machines program at................................   478
    Science education................................................   413
    Science program:
        Basic energy sciences........................................   402
        Direction....................................................   413
    Science research budget request..................................   386
    Scientific simulation initiative.................................   392
    Spallation neutron source [SNS]................................391, 479
    Strategies--initiatives for fiscal year 2000, implementing the...   397
    Technical information management.................................   414

                           DEPARTMENT OF THE INTERIOR

                             Bureau of Reclamation

                                                                          1
    Animas-La Plata..................................................    38
    Bay-Delta:
        Ecosystem funding............................................    25
        Funding by agency............................................    26
    Budget:
        Priorities, stakeholders' input into.........................    29
        Request......................................................     2
    Bureau of Reclamation............................................     6
    Bureauwide operation and maintenance costs.......................    28
    California Bay-Delta Ecosystem Restoration (CALFED).............. 5, 41
        Appropriations and expenditures..............................    26
        Expenditures.................................................    27
        Program......................................................     4
        Status of spending on........................................    31
    Central Arizona project..........................................    49
    Central Utah project............................................. 5, 15
    Central Utah Project Completion Act..............................     6
    Competing water demands, managing................................    42
    Cost Overruns....................................................    56
    CVP, American River Division.....................................    49
    Dakota Resources Act.............................................    17
    Dam Safety Program...............................................20, 45
    Dams:
        Corrective actions, initiate safety of.......................    45
        Initiate safety of...........................................    45
        Safety evaluation of existing................................    45
    Desalination.....................................................11, 21
        Funding in Federal Government Agencies.......................22, 23
        Reclamation's Future Focus...................................    12
            Role in..................................................    11
    Drought:
        Assistance...................................................    20
        Funding......................................................    21
    Emergency planning and disaster response program.................    52
    Garrison diversion unit..........................................    60
    Glendive, Montana................................................    31
    Indian water settlements.........................................    25
    Lake Powell draining.............................................    16
    Land management and fish & wildlife activities...................    60
    Long Beach water reclamation and reuse...........................    51
    Lower Yellowstone title transfer--intake diversionary dam........    55
    Montana safety of dams projects..................................    54
    MR&I needs of Indian tribes......................................    18
    New Mexico drought conditions....................................    34
    Nimbus fish hatchery interpretive facility.......................    49
    O&M activities, staffing levels for..............................    29
    Operation and maintenance costs..................................    42
    Overall Program Goals............................................    13
    Pueblo Dam.......................................................    46
    Reclamation:
        Grazing permits..............................................    30
        Recreation Management Program--Title XXVIII..................    38
    Red Butte Dam....................................................    15
    Red River Valley Water Need Studies..............................    19
    Safety of dams...................................................    19
        Program......................................................     7
    Salinity control program.........................................    15
    Salton Sea, California research project..........................    39
    San Juan Gallup--Navajo water supply study.......................    36
    San Juan River project...........................................    24
        Gallup, Mount Taylor pipeline................................    35
    Snake River plain aquifer........................................    60
    Taos Indian water rights settlement..............................    36
    Technical/Emphasis Areas.........................................    13
    Title XVI water reclamation and reuse program....................    54
        Water reuse program..........................................    16
    Truckee River Operating Agreement................................    10
    Upper Rio Grande basin water management..........................    37
    Ute Reservoir pipeline project, Curry and Roosevelt Counties, NM.    37
    Year 2000 compliance.............................................    47
    Yellowstone River flooding conditions............................    30
    Yellowtail Dam & Bighorn Lake operations.........................    58
    Yuma:
        Area projects................................................    52
        Desalting plant..............................................    50

                          DEPARTMENT OF DEFENSE--CIVIL

                             Department of the Army

                           Corps of Engineers--Civil

    Acequias irrigation system, New Mexico.........................116, 163
    Administrative appeals...........................................   112
    Bluestone:
        Dam safety project...........................................   186
        Drift and debris.............................................   185
    Bonneville and the Dalles powerhouse:
        Projects replace generating units............................   189
        Rehabilitation...............................................   102
    Bonneville powerhouse phase II, Oregon and Washington (major
      rehabilitation)................................................   103
    Budget:
        Overview.....................................................    66
        Themes.......................................................    65
    Business operations, improvement in..............................    88
    Caspian tern.....................................................    96
    Challenge 21 program.............................................   176
    Civil Works program:
        Budget, fiscal year 2000.....................................    69
        Performance..................................................    69
    Clarkston and Lewiston, ports of.................................    96
    Coastal environmental impact study, Mississippi..................   167
    Columbia and Snake Rivers........................................   101
    Columbia River fish mitigation project...........................   188
    Construction:
        Capabilities, fiscal year 2000...............................   120
        General......................................................71, 85
            Continuing authorities...................................   176
    Cooperative agreements...........................................   187
    Corps of Engineers:
        Dam Safety Program...........................................   115
        Financial management system..................................    89
        Vision.......................................................    90
    Credits and reimbursements.......................................   104
    Dam safety.......................................................   115
    Devils Lake:
        Dikes........................................................   190
        North Dakota.................................................    97
        Outlet.......................................................    98
    Divisions........................................................    87
    Drawdown studies.................................................   103
    Economy and the environment......................................    70
    Efficiency and responsive measures...............................    79
    Emergency operations organization................................    87
    Environmental:
        Programs.....................................................    67
        Projects and aquatic ecosystems..............................   179
    Erosion control, demonstration...................................   167
    Fiscal year 2000:
        Civil Works program budget...................................    82
        Continuing program, highlights of the........................    71
    FUSRAP program...................................................    80
    General expenses.................................................    86
        Account......................................................    81
        Appropriation request........................................   146
    General investigations...........................................    85
    Government performance and results...............................    89
    Grand Forks:
        Dikes........................................................   191
        North Dakota.................................................    98
    Greenbrier basin flood protection................................   181
    Harbor service:
        Fee, support for the.........................................   111
        Fund..............................................67, 109, 118, 176
            Proposal.................................................    69
    Headquarters.....................................................    87
        And division offices, restructuring of.......................   177
    Investigations, general..........................................    72
    Island Creek at Logan............................................   186
    Jackson County, Mississippi......................................   166
    John Day Dam drawdown study......................................   102
    Lafarge Lake, WI.................................................    99
    Level deferred maintenance.......................................   113
    Libby Dam, MT....................................................   175
    London lock and Dam..............................................   187
    Lower Las Vegas wash wetlands....................................   177
    Lower Mud River..................................................   187
    Marmet locks and Dam.............................................   180
    Milo Creek.......................................................   174
    Mississippi River and tributaries..............................149, 165
        Budget request...............................................   100
    Mississippi River levees.........................................   166
    Natchez, Mississippi.............................................   166
    New funding......................................................    83
    New investments..................................................    71
    New study starts.................................................   105
    O&M increase.....................................................   179
    Operation and maintenance:
        Budget request...............................................   160
        General......................................................71, 85
        Program......................................................    81
    Program execution...............................................80, 161
        Outlook......................................................    84
    Project:
        Conditions...................................................   114
        Cost sharing problems........................................    64
        Management...................................................79, 88
    Projects budgeted for fiscal year 2000, fully funded.............   120
    Regulatory administrative appeals process........................    99
    Regulatory appeals process.......................................   177
    Regulatory program..................................67, 73, 81, 93, 170
        Administrative appeal.................................147, 168, 173
    Reimbursed program...............................................    84
    Reimbursements and credits.......................................   146
    Remedial Action Program, formerly utilized sites................85, 160
    Restructuring....................................................    86
    Robert C. Byrd locks and Dam.....................................   184
    Santa Ynez, CA study.............................................   109
    Small Business Program...........................................    89
    Snake River Dam removal..........................................    93
    South Pacific division...........................................   163
    Staffing.........................................................    84
    Strategic planning...............................................    88
    Technical centers of expertise...................................   163
    2000 funding level, impact of....................................   180
    Upper Jordan River restoration project, section 206..............    91
    Upper Rio Grande water operation model, New Mexico.............116, 163
    Water resource development process...............................    66
    Water Resources Development Acts of 1999 and 2000................    69
    West Virginia:
        Statewide flood protection plan..............................   184
        Tug Fork flood protection projects...........................   182
    Wheeling riverfront..............................................   183
    Winfield lock & Dam..............................................   185
    Yellowtail Dam, MT...............................................    98

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